Do you consider investing in Canadian ETFs? If you live outside of Canada, it is not so simple. But even if you are not an American, you can still find a few brokers that let you trade Canadian ETFs. However, not many provide a platform that lets you simplify tax handling. Add to this usually higher fees in comparison to what you can expect from brokers offering American ETFs. But if Canadian ETFs are important for your investing strategy, do not give up. We found a few brokers offering Canadian ETFs that you may consider.
The shortlist of brokers offering Canadian ETFs
Unfortunately, the list contains only 3 positions. None of these brokers is perfect.
PhillipCapital
This is a broker from Singapore. It is not the cheapest one and trading on Canadian exchange requires placing such orders either via phone or email. However, PhillipCapital offers quite good customer support and the handling of this exchange is quite smooth. You can still view your open positions via their online platforms. Trades and dividends also appear in the history in the POEMS platform. Only orders for the Canadian market are offline.
PhillipCapital provides additional investing opportunities outside of Canada. It lets you connect to 26 stock exchanges and operate based on 10 currencies. They give you access to stocks, CFDs, ETFs, Forex, futures, and more. It is also the only broker on this list that you trade Canadian ETFs and reduces their dividends only by treaty-based withholding tax rate between your country and Canada. PhillipCapital serves all adults who are not US people.
EXANTE
EXANTE is located in Cyprus and it is the cheapest broker from Europe that offers access to Canadian ETFs. It is also the only one on this list that does not require a custody fee. Moreover, it offers direct access to over 50 financial markets through one account. Its other commissions are also low. However, EXANTE requires at least 10,000 EUR of the initial deposit to open an individual account or 50,000 EUR to open a corporate account. You can also deposit an equivalent sum in USD, GBP, CHF, CZK, or PLN. You will not be able to open an account on EXANTE, if you are from the USA, Japan, France, Iran, and the Democratic People’s Republic of Korea (DPRK). Unfortunately, EXANTE does not offer as good tax conditions as PhillipCapital does.
DIF Broker
DIF Broker is a broker from Portugal. Its minimum initial deposit is much lower than on EXANTE because it requires only 2,000 EUR but its fees are higher. Its tax conditions related to Canadian ETFs are similar to EXANTE.
Apples to apples
Listed brokers offer different services. Their fee structure is also built differently. To be able to compare them, we prepared a few tables, so you can be aware of the most important costs when using any of them. This ranking is focused on Canadian ETFs, so the comparisons are limited to the use of these financial instruments.
Trading scenarios
Initially, we consider a small trade – 5 ETF units – each priced at 5 CAD per unit. PhillipCapital is significantly the most expensive of listed brokers for such a small transaction because of the minimum offline trade commission for the market in Canada. You pay more commission than the total value of traded ETFs. However, DIF Broker minimum commission in this case is also high.
| Broker | Trade commission | Trade fees |
| PhillipCapital | 35.00 CAD | 0.00 CAD |
| EXANTE | 1.00 CAD | 0.00 CAD |
| DIF Broker | 20.00 CAD | 0.00 CAD |
Since both European brokers require an initial deposit, let’s consider a significantly larger trade – 100 ETF units (price: 400 CAD). This results in a 40.000 CAD price of just ETF units.
| Broker | Trade commission | Trade fees |
| PhillipCapital | 160.00 CAD | 0.00 CAD |
| EXANTE | 2.00 CAD | 0.00 CAD |
| DIF Broker | 20.00 CAD | 0.00 CAD |
Again, EXANTE is the cheapest option. Both European brokers for this market use pricing per share in contrast to percentage-wise pricing used by PhillipCapital. DIF Broker commission is the same in both cases because of its minimum commission when trading in Canada. In theory, this broker commission rate is 0.03 CAD per unit but you would need to buy at least 667 units to start utilizing this mechanism.
Dividend processing fee
Some brokers charge a dividend processing fee. On this list, this is only applicable to PhillipCapital.
| Broker | Dividend processing fee |
| PhillipCapital | 1% of net dividend (minimum 1.00 SGD, maximum 50.00 SGD per dividend) |
| EXANTE | 0.00 CAD |
| DIF Broker | 0.00 CAD |
Other fees
Trade commissions are not the only cases when a broker reduces your profits. If you actively use your account, there are no additional fees when you are a customer of EXANTE. However, these brokers will charge you when you withdraw your money through a wire transfer. DIF Broker only passes bank costs to customers. PhillipCapital does not have a withdrawal fee. Generally, EXANTE is the cheapest of brokers offering Canadian ETFs because it also does not charge you a custody fee.
| Broker | Custody fee | Inactivity fee (monthly) | Withdrawal fee |
| PhillipCapital | 2.00 SGD per counter per month (max 150.00 SGD per quarter) that can be waived (minimum 2 trades per month or 6 trades per quarter or assets worth at least 250,000 SGD) | 15.00 SGD (waived in case of at least 1 trade per quarter) | 0.00 CAD |
| EXANTE | 0.00 CAD | 50.00 EUR/GBP (in theory because it can be easily waived) | 30.00 EUR/GBP |
| DIF Broker | 0.25% per year, with a minimum of 5.50 USD per market/monthly, plus VAT | 36.00 EUR, plus VAT | 0.00-146.30 EUR (depending on currency and amount but CAD is not available for withdrawal) |
Taxes consideration
Based solely on the above tables, PhillipCapital looks the worst. It is not only the most expensive broker but also does not let you trade Canadian ETFs online. But it handles withholding tax rate for dividends in a better – though not the best – way. You still need to pay the dividend processing fee. Depending on your country of residence, your tax rate before this fee may be different. However, PhillipCapital respects the treaty-based withholding tax rate.
| Broker | Treaty-based withholding tax rate |
| PhillipCapital | YES |
| EXANTE | NO |
| DIF Broker | NO |
Conclusion
Summing up, we compared brokers that let you trade Canadian ETFs in Europe. This list is very short.
Which brokers offer Canadian ETFs?
- PhillipCapital
- EXANTE
- DIF Broker
Best broker offering Canadian ETFs
To put it in a nutshell, if you want to focus on investing, then PhillipCapital not only offers access to the Canadian market but also dividends paid out by ETFs follow treaty-based withholding tax rates. Deciding on EXANTE or DIF Broker will make your tax situation more complex. So if you prefer to trade fully online, you should pick one of them. EXANTE seems to be a better choice because it is simply cheaper than DIF Brokers and gives you access to more investing opportunities.