Is iShares Core S&P/TSX Capped Composite Index ETF (XIC) better in a TFSA, RRSP, or taxable account?
iShares Core S&P/TSX Capped Composite Index ETF (XIC) trades on TSX and is CA-domiciled. Here is the educational, tax-aware account-location read for Canadian investors deciding between a TFSA, RRSP, and taxable account.
Educational account fit: TFSA
An ETF of Canadian companies pays Canadian-eligible dividends. TFSA shelters the dividend and capital gain entirely, with no foreign withholding to worry about.
Dividend character: Canadian eligible dividends (passed through). Listing eligibility: Yes* — Listed on TSX, a designated exchange in this build's exchange map
This is a fund/ETF. Fund distributions are not automatically Canadian eligible dividends, and withholding can apply at the fund level. See Canadian-listed vs US-listed ETFs.
XIC across account types
TFSA
Clean fit. Canadian eligible dividends are tax-sheltered with no foreign withholding leakage.
RRSP
Also tax-deferred, but you give up the dividend tax credit you would have received in a taxable account, so consider whether RRSP is the best use.
Taxable (non-registered)
Canadian eligible dividends get the dividend tax credit, which makes a taxable account quite tax-efficient for this exposure.
See the live read for XIC
Open iShares Core S&P/TSX Capped Composite Index ETF in the screener for current data and the full TFSA, RRSP, and taxable-account breakdown.
Open XIC in the screener