T1135 Reporting for U.S. Brokerage and Investment Accounts Held by Canadians

Many Canadians end up holding a U.S. brokerage or investment account at some point — from a work stint south of the border, an inheritance from an American relative, or simply an account opened years before moving to Ontario. Once you're a Canadian tax resident, that account doesn't just sit quietly in the background. It can trigger a T1135 US brokerage account reporting obligation, and the rules catch people who assume that only unusual offshore holdings count.

This article explains, in general terms, how a U.S.-based brokerage or investment account fits into Canada's foreign-property reporting regime, and where people commonly go wrong. It isn't a substitute for a review of your specific accounts — foreign reporting rules turn on details that vary account by account, so confirm your own situation with a tax professional.

Why a U.S. Brokerage Account Is Usually "Specified Foreign Property"

A brokerage or investment account held with a U.S. financial institution is generally property held outside Canada, which is one of the broad categories CRA treats as specified foreign property for T1135 purposes. It doesn't matter whether the account is denominated in U.S. dollars, whether you actively trade in it, or whether you've ever withdrawn money from it — simply holding the account as a Canadian tax resident is generally enough to bring it into the analysis.

This surprises people who assume the reporting regime only targets numbered offshore accounts or unusual structures. A mainstream U.S. brokerage account is treated the same way as any other foreign holding for this purpose.

It's Not Just the Account — What's Inside It Counts Too

Depending on which reporting method applies to your combined foreign holdings, you may need to describe not just the account itself but the individual securities held inside it, such as U.S. stocks, bonds, mutual funds, or ETFs. A large brokerage account holding many individual positions can mean a correspondingly detailed T1135, unless your combined foreign holdings qualify for a simpler reporting approach. Our companion article on what counts as specified foreign property walks through the categories in more depth.

How Canadians Typically End Up With a U.S. Account

• Working in the U.S. temporarily and leaving a taxable brokerage account open after returning to Canada
• Inheriting an account from a parent or relative who lived in the United States
• Opening an account while a U.S. resident, before moving to Ontario
• Receiving employer equity compensation that settles into a U.S.-based brokerage platform

In each situation, the account doesn't stop being "foreign" just because you're no longer physically in the U.S. What matters is where the account and its custodian are located, not where you currently live.

U.S. Retirement Accounts Raise a Separate Question

A 401(k) or an IRA is not the same thing as a taxable U.S. brokerage account, and it doesn't automatically get the same treatment as a Canadian RRSP. The exclusion that applies to Canadian registered plans is specific to plans registered under Canadian tax law — it doesn't extend automatically to a foreign retirement plan just because it serves a similar purpose. How a U.S. retirement account should be reported, and whether any tax-treaty relief applies to it, depends on the type of plan and your personal facts. Don't assume either way; get advice specific to the account.

Converting to Canadian Dollars and Combining With Everything Else

Whatever the account holds, the values need to be converted into Canadian dollars for the T1135 calculation. The result then gets added to every other piece of specified foreign property you hold — other foreign accounts, foreign real estate, foreign shares held elsewhere — to determine whether you've crossed the filing threshold for the year. A single U.S. brokerage account rarely tells the whole story on its own.

Frequently asked questions