2017 survival guide for tax reporting

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2017 SURVIVAL GUIDE

FOR

TAX REPORTING This guide is designed to assist RBC Dominion Securities, RBC Estate & Trust and RBC Direct Investing Branches in understanding the tax documents issued by Canadian Wealth Management Operations. This document is intended for internal reference only. The information in this Guide should not be construed as offering tax advice. Clients are always encouraged to consult with a qualified tax advisor before filing their tax return. Additional information about specific securities/situations may be published separately.

JANUARY 2018

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INTRODUCTION ............................................................................................................................................................ 5

MAILING DATES ............................................................................................................................................................ 6

OVERVIEW: DOCUNET VIEWING AND MAILING DETAILS .............................................................................. 7

A. CLIENT TAX PACKAGES AND DUPLICATES ON DOCUNET: .......................................................................................... 7 B. MAILING INFORMATION: ................................................................................................................................................. 8 C. DUPLICATE TAX PACKAGES FOR INTERESTED PARTIES................................................................................................. 9 D. HOLD MAIL - E-MAIL NOTIFICATION SYSTEM ............................................................................................................ 10

WHAT’S NEW FOR 2017 YEAR-END TAX REPORTING?........................................................................................ 10

GENERAL INFORMATION, INQUIRIES & SERVICE ................................................................................................. 11

I. WHO DO I CONTACT FOR ASSISTANCE? ............................................................................................................ 11

II. WHAT CAN I ACCESS MYSELF IN THE BRANCH/CENTRE? .......................................................................... 11

III. WHAT CAN MY MIDDLE OFFICE SERVICE TEAM ASSIST WITH? ........................................................... 12

IV. WHO ELSE CAN I CONTACT AT HEAD OFFICE? ............................................................................................. 12

TAX FORM GRID: DESCRIPTIONS, MAIL DATES AND ASSISTANCE ............................................................ 13

NON-REGISTERED TAX REPORTING : T5, SUMMARY OF SECURITY DISPOSITIONS (T5008), T3, T5013 & NR4 GENERAL INFORMATION ............................................................................................................................ 17

GENERAL INFORMATION: WHAT’S IN THE T5 TAX PACKAGE ...................................................................... 17 I REPORTING TOOLS IN THE T5 TAX PACKAGE AND FUNCTIONALITY ........................................................................... 17

(A) Income Trust Disposition Gain/Loss Worksheet ......................................................................................................... 17 (C) Foreign Assets - $ 100K CDN Reminder ....................................................................................................................... 17 (D) Notification of Forthcoming Tax Forms ...................................................................................................................... 18

- E.G. EAGLE ENERGY TRUST UNITS ............................................................................................................................................... 18 (E) Summary of Fees for Managed Products .................................................................................................................... 18 (F) Client Guide to Tax Reporting...................................................................................................................................... 19

T5 TAX REPORTING ........................................................................................................................................................ 24 (A) T5 Tax Slip .................................................................................................................................................................... 24 (B) Summary of Investment Income and Expenses .......................................................................................................... 26 (C) Releve 3 Tax Slip .......................................................................................................................................................... 28 (D) Special Reporting for Specific Type of Securities ........................................................................................................ 28 (E) Special Reporting for Specific Type of Accounts and Scenarios ................................................................................. 29

T5008 TAX REPORTING - SUMMARY OF SECURITY DISPOSITIONS .............................................................. 30

I SUMMARY OF SECURITY DISPOSITIONS REPORTING AND FUNCTIONALITY ............................................................... 31 (A) Reporting to the Canada Revenue Agency (CRA) ....................................................................................................... 31 (B) Book Cost Information ................................................................................................................................................ 31 (C) Disposition Transactions with Missing Book Values .................................................................................................. 34 (D) Native Cost Functionality ............................................................................................................................................ 35 (E) Disposition Information ............................................................................................................................................... 36 (F) Gain/Loss Data............................................................................................................................................................. 37 (G) Summary of Security Dispositions Totals Section....................................................................................................... 39 (H) Foreign Currency Disposition Reporting ..................................................................................................................... 40 (I) Summary of Security Dispositions Symbols ................................................................................................................. 40

II INTERNAL TOOLS THAT CAN BE USED TO SUPPORT THE SUMMARY OF SECURITY DISPOSITIONS ......................... 58

(A) Summary of Security Dispositions and ClientLink Realized Gain/Loss Reports ......................................................... 58 (B)Summary of Security Dispositions and Statements under Client Relationship Model Phase 2 (CRM2) .................... 59

T3 TAX REPORTING: ....................................................................................................................................................... 59

I T3 TAX REPORTING AND FUNCTIONALITY ..................................................................................................................... 59 (A) T3 Tax Slip .................................................................................................................................................................... 59 (B) Income Trusts – T3 Tax Slip Delivery Schedule ........................................................................................................... 61 (C) Releve 16 Tax Slip ........................................................................................................................................................ 62

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(D) Statement of Trust Income and Allocations/Designations ........................................................................................ 62 (E) Return of Capital Processing (ROC) – T3 reporting ..................................................................................................... 63 (F) Non-Resident Tax Processing – T3 Reporting ............................................................................................................. 63 (G) Mutual Funds .............................................................................................................................................................. 63

II INTERNAL TOOLS THAT CAN BE USED TO SUPPORT THE T3 TAX SLIP ..................................................................... 63 (A) Income Trust Disposition Gain/Loss Worksheet ......................................................................................................... 64 (B) Notification of Forthcoming Tax Forms ...................................................................................................................... 64 (C) Client Guide to Tax Reporting ..................................................................................................................................... 64 (D) 2017 Income Trust Distribution Rates ........................................................................................................................ 65

NR4 TAX REPORTING .................................................................................................................................................... 66

I NR4 TAX REPORTING AND FUNCTIONALITY .................................................................................................................. 66 (A) NR4 Tax Slip ................................................................................................................................................................. 66 (B) Statement of Trust Income and Allocations/Designations and/or Summary of Investment Income and Expenses 67 (C) Non-Resident Tax Processing – T3/NR4 Reporting ..................................................................................................... 68

T5013 TAX REPORTING .................................................................................................................................................. 69

I T5013 TAX REPORTING AND FUNCTIONALITY ............................................................................................................... 69 (A) Limited Partnership Units, Flow-Through Shares – T5013 reporting ......................................................................... 69 (B) Limited Partnership Units, Flow-Through – T5013 Tax Slip Delivery Schedule .......................................................... 71 (C) T5013 and T5013A Tax Slips ........................................................................................................................................ 71 (D) Releve 15 Tax Slip ........................................................................................................................................................ 72 (E) Gaz Metro – T5013 Reporting ..................................................................................................................................... 73 (F) DOCUnet Viewing – T5013 Reporting ......................................................................................................................... 73

QUALIFIED INTERMEDIARY/US REPORTING: 1099-DIV, 1099-INT, 1099-OID, 1099-MISC, 1099-B, 1042-S GENERAL INFORMATION ................................................................................................................................................................... 74

GENERAL INFORMATION: WHAT’S IN THE QI TAX PACKAGE ...................................................................... 75 (A) QI Summary of 1099 Investment Income ................................................................................................................... 75 (B) 1099 Income Totals ..................................................................................................................................................... 76 (C) 1099-DIV “Dividends and Distributions” ..................................................................................................................... 77 (D) 1099-INT “Interest Income” ........................................................................................................................................ 78 (E) 1099-OID “Original Issue Discount” ............................................................................................................................ 79 (F) 1099-MISC “Miscellaneous Income” ........................................................................................................................... 79 (G) 1099-B Summary “Proceeds From Broker and Barter Exchange Transactions” ........................................................ 80 H) 1042-S Tax Forms.......................................................................................................................................................... 81

REGISTERED ACCOUNTS: T4RSP, T4RIF, T4A, NR4 ............................................................................................ 81

(A) Registered Tax Package Delivery ................................................................................................................................ 82 (B) 2017 Contribution Deadline ....................................................................................................................................... 82

GENERAL INFORMATION: WHAT’S IN THE REGISTERED TAX PACKAGE ................................................. 82 (A) Types of Registered Tax Forms ................................................................................................................................... 82

TAX FREE SAVINGS ACCOUNTS (TFSA) ................................................................................................................ 88

MUTUAL FUNDS .......................................................................................................................................................... 90

(B) Mutual Fund Automatic Withdrawal Plans ................................................................................................................ 94

ESTATE & TRUST PROGRAMS ................................................................................................................................. 95

GENERAL INFORMATION, INQUIRIES & SERVICE ............................................................................................ 95

TAX FREE SAVINGS ACCOUNTS (TFSA) * NOT APPLICABLE TO E&T ........................................................... 95

MUTUAL/POOLED FUNDS ......................................................................................................................................... 95

WHERE CAN I GO FOR MORE INFORMATION? .................................................................................................. 96

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AMENDMENT REQUEST PROCESS AND FORMS(REGULAR) .......................................................................... 97

MUTUAL FUND AMENDMENT REQUEST PROCESS AND FORM ................................................................... 98

MUTUAL FUND TAX RECEIPT AMENDMENT REQUEST FORM ...................................................................... 99

ADVISOR/PIM PROCESS FOR REQUESTING AN AMENDMENT TO A FEE SUMMARY LETTER ........... 100

REQUESTING DUPLICATE RBF FUND TAX RECIEPTS FOR ECA ACCOUNTS ............................................... 100

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INTRODUCTION

As part of our service commitment, we are pleased to provide the 2017 Survival Guide for Tax Reporting. This guide has been designed as a comprehensive reference tool and should be used as a source for answering client’s questions during the tax season. As you review the guide, you will observe that it contains information on both registered and non-registered accounts, as well as information on mutual funds and US tax reporting. As outlined in this guide, your Middle office Service Team should be your first point of contact for any questions that either you or your clients may have regarding tax mailings. Your Middle office service team will be able to escalate your issues to the appropriate head office contact in order to ensure timely response times to your clients’ issues. In addition to your Middle office service team, there are a number of people within the Canadian Wealth Management Operations team that you may contact. The contact information is included in this Survival Guide. In addition to this document, we will be populating our Tax Reporting site on Advisornet with daily updates during tax season. You can bookmark the link to the Tax Reporting Site now!

http://advisornet.fg.rbc.com/taxreporting/cid-180846.html

Examples of some of the documents published on our Tax Reporting site are:

2017 Survival Guide for Tax Reporting

Client Guides to 2017 Tax Reporting – Expanded Guides for clients in the Access, Advisor, Parameters, Private Investment Management, Estate & Trust and PH&N programs.

2017 Sample Tax Package

2017 Income Trust Distribution Rates Our objective is to make the Tax Reporting process for 2017 yearend as seamless and simple as possible for you and your clients. We welcome your feedback and suggestions.

http://advisornet.fg.rbc.com/advoperationsnet/cid-414720.html


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MAILING DATES Every year we take measures to provide our clients with their tax packages as promptly as possible. For the 2017 tax yearend process, the mailing dates for tax packages are as follows: Non-Registered Accounts

T5/R3&NR4 Package - Approximately February 14, 2018

T5013/A Forms / R15 (Limited Partnership Units) - From March 6, 2018 – Completion*

T5 Split Corps Package - From February 27 –February 28, 2018

T3/R16 & NR4 Package (Income Trusts) - From March 6, 2018 - Completion**

T3/R16 RBC Private Pools Series O Package - From March 15 – March 31, 2018

1099 Package (for U.S. persons) - Mandatory- January 31, 2018 (30-day ext)

1042-S Slips/Package -Mandatory- March 15, 2018 (30-day ext)

* Note: T5013 packages are produced and mailed in multiple batch runs commencing March 06/18. T3 packages are produced and mailed in multiple batch runs commencing approximately March 08/18. The need for multiple runs is guided by the release of taxable distribution information by the Issuers. This process will be completed once all issuers have released their taxable information.

**Once an income trust issuer releases their taxable distribution information through the Canadian Depository for Securities (CDS) it will take approximately 7 to 10 days for the firm to collect, review, and mail the T3 tax packages. For example, to meet the March 6 mailing date, issuers must at latest release their T3 information to CDS by February 26. In some cases however, a security may be removed at any time from any mailing run if the issuer has amended previous information.

Registered Accounts

T4RSP/R2 Forms - February 13, 2018

T4RIF/R2 Forms - February 13, 2018

T4A/R1 Forms - February 13, 2018

NR4 Forms - February 13, 2018

Contribution Receipts - Remainder of 2017 - January 09, 2018 - Jan 2nd to Jan 12th - January 17 , 2018 - Jan 15th to Jan 26th - January 31, 2018

- Jan 29th and on - Weekly

Mailing Date Frequently Asked Questions:

My client received a T3 tax package in early April but had already filed their personal income taxes. Why would they receive a T3 package in April?

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The Income Trust that your client holds did not release their taxable distribution information in a timely manner or amended previously issued information. Despite, the Federal Government legislation effective tax season 2007 requiring income trust and publicly-held limited partnership issuers to report to financial intermediaries by February 28, you may still receive tax packages into April due to late disclosures and amendments by some income trusts and limited partnership units. Please note that the government’s February deadline does not apply to privately-held limited partnerships, which still have until March 31 to file disclosures. Please encourage your clients to review their “Important Information Regarding Outstanding Tax Documents”, included in their T5 mailing as a tool to determine if all possible slips have been received prior to filing their taxes. Updates will be posted on Advisornet beginning in March continuing until all T3 tax packages have been mailed.

OVERVIEW: DOCUNET VIEWING AND MAILING DETAILS A. Client Tax Packages and Duplicates on DOCUnet: Client tax packages, including amended tax slips, if applicable, can be reviewed and printed online using DOCUnet. DOCUnet is your primary source for all tax package content, registered and non-registered, including cover letters, summary statements and Canada Revenue Agency (CRA) tax slips complete with RBC logos. As a result, duplicate branch and IA copies will not be provided by head office. Letterhead paper is not required for duplicate copies, a service approved by the CRA. Moreover, duplicate copies of RSP Contribution Receipts posted on DOCUnet can now be used as a true facsimile. The duplicate contribution receipt can be sent directly to clients should they require it. Royal Mutual Funds (RBF) T3 and T5 tax slips will be available for viewing and printing as a duplicate on DOCUnet. Global Asset Management and RBC Investor Services will provide the Tax Reporting Group with copies of the original tax slips mailed to your clients for the 2017 tax year. Any questions with reference to these tax slips should be directed to the RBC Investor Services as per the normal process.

DOCUnet Frequently Asked Questions:

What does the IA/Branch/Centre have access to on DOCUnet? In order to ensure that you are able to service client inquiries effectively, you will have access to the following client tax package information on DOCUnet: Non-Registered Accounts Cover letters (including logos) Summary of Investment Income and Expense/T5 slip Summary of Security Dispositions [included in the T5 package], where applicable Summary of Trust Income Allocations/Designations & T3 slip T5013Form – Statement of Partnership Income 1099 and related U.S. Reporting Forms Royal Mutual Fund (RBF, PHN) T3 and T5 Tax Slips Registered Accounts Contribution Receipts T4RSP/T4RIF/R2/NR4/T4A/R1 RIF Valuation Letters In addition, all Client Tax Guides that are included in all T5 tax packages will be available for viewing on Advisornet, the RBC Direct Investing website.

http://www.rbcds.com/TaxReporting2007/FebDef-OutstandingTaxDocuments.html

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*Please note that any tax information for external mutual fund companies will not be available for online viewing on DOCUnet.

I went to DOCUnet and looked for a duplicate tax form, and I can’t find it – what should I do? For a non-registered account, a good first step is to determine if the account would have been eligible for a form. Clients will not receive T5 tax slips where income is <$50 CDN. Please check the December 2017 month-end statement and review the Dividend and Interest buckets. If the total is <$50 CDN, no tax receipt will be issued. NR4 slips are not printed for <$10 CDN nor for foreign source income. T3 and T5013 forms for Mutual Funds/Income Trusts/Sovereign Pools and Limited Partnerships respectively do not have any dollar thresholds. If the account is eligible for a tax form and you still can’t find it on DOCUnet, please review the following:

Since Mutual Fund companies do their own tax reporting for income received, none of their forms would be on our DOCUnet system (except Royal Mutual Funds, Phillips, Hager & North) ;

For further assistance, please contact your Middle office service team. They will escalate your issues to the Tax Reporting department as necessary.

Can I view my clients amended tax packages on DOCUnet? Yes. Amended client tax packages will be available for online viewing on DOCUnet. You will be able to view the package that requires the amendment (“Amendment Required”) as well as the corrected and completed package (“Amended”).

B. Mailing Information: Mailing of tax packages depends on the finalized address on the account as of December 31st of the tax year in question. Since the tax package data is produced at that point, mailing can only occur based on the address at that point. The only exception will be the T3/T5013 tax package deliveries. Since T3 packages are delivered in different tranches throughout March, address changes can be completed prior to delivery provided the changes are in place on the system before the tax package is produced. Since mailing dates depends on issuer delivery it is suggested that changes are completed well in advance. Tax reporting cannot guarantee accurate delivery on any address changes during this period. The following are specific details for delivery for different managed products:

A+, Access and Parameters Portfolios programs: Book cost information and gain/loss data will be provided by RBC in the T5 tax package delivered to clients in mid-February 2018. T5 packages for clients of the A+, Access and Parameters Program will include an enhanced Client Tax Guide to assist clients with questions regarding their tax packages. For more information please contact the Fee Based Operations department directly.

Advisor and Private Investment Management programs: Clients of these programs will receive a Summary of Fees as part of their 2017 T5 tax package. T5 packages for clients of these programs will also include an enhanced Client Tax Guide to assist clients with questions regarding their tax packages.

International Advisory Group: Tax packages for clients of the International Advisory Group will be provided based on previously specified special handling requirements. All information that is provided to clients will be available on DOCUnet for branch review.

Clients of the International Advisory Group (domestic offices) will be provided with a complete tax package in ‘no logo’ envelopes to maintain privacy requirements; and,

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Clients of the International Advisory Group (offshore offices) will not be provided with CRA related filings. All summary information will be sent to clients in ‘no logo’ envelopes to maintain privacy requirements.

C. Duplicate Tax Packages for Interested Parties Clients have the option to automatically mail registered (T4RSP, T4RIF, RL-2, NR4) and Canadian non-registered account tax packages to one Interested Party (IP) that is produced and controlled by Dominion Securities. The IP will receive all tax documents the client receives as well as peripheral documents such as the fee summary letter and some tools that will assist in reporting (i.e. Gain/Loss Worksheet). Tax operations will still deliver the tax package to the client as per our regulatory obligation. For more information please review the following link on our Tax reporting site, http://advisornet.fg.rbc.com/taxreporting/cid-288991.html

Duplicate Tax Package Frequently Asked Questions: Will client tax packages be mailed to the Interested Party (IP) address associated with my clients account or will the tax packages be mailed to the account holder only? All client tax packages are mailed to the name and address of the account holder as it appears on the Name & Address screen of BTS. Also, the first IP address that is confirmed for delivery on Clientsource associated with your clients account will also receive any tax packages.

How do I set up an IP to receive a tax package?

For each non-registered or registered account, clients can choose one IP to receive a copy of the respective 2017 Tax Package. A Letter of Authorization (LOA) is required to add the tax package to the IP profile. Only one IP may receive a duplicate tax package per account, and if more than one IP has YES selected, only the first IP selected will receive the duplicate mailing. The duplicate tax package option is separate from the duplicate custody statement selection.

Refer to the Internal Control on Name and Address Changes for information on LOAs.

Go to the Interested Party Screen in ClientSource and select YES to the "IP to receive CAD tax package" question.

Refer to the Duplicate Tax Package Job Aid for further instructions.

What is the cut-off date for setting up IPs on Clientsource? The cut-off date for setting up 1 Interested Party for tax mailing is December 15th annually. Please note a letter of authorization is required to add a tax package to the IP profile. Only Canadian Non-registered and registered (T4RSP, T4RIF, RL-2, NR4) tax packages apply to this functionality

Which tax slips are delivered to my interested party? Once the IP option is chosen by the client on Clientsource, specific registered (T4RSP, T4RIF, RL-2, NR4) and all non-registered tax slips produced by RBC Dominion Securities (DS) Tax operations only are subject to interested party delivery. Therefore, all non-registered tax slips produced by DS that are mailed to the client is also mailed to the interested party. For registered tax reporting, only the T4RSP, T4RIF, RL-2 and NR4 produced by DS are mailed to the interested party. Please note tax slips that are not produced by DS (i.e. Mutual Fund T5’s and T3’s are not subject to interested party functionality.

My client has received the amended/ hold mail package. Will the Interested Party also receive the amendment?


http://advisornet.fg.rbc.com/internalcontrols/cid-286628.html

http://advisornet.fg.rbc.com/businessinitiatives/file-593279.pdf

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All client tax packages are mailed to the name and address of the account holder as it appears on the Name & Address screen of BTS. Also, the first IP address that is confirmed for delivery on Clientsource associated with your clients account will also receive any tax packages, amendments included.

D. Hold Mail - E-mail Notification System For the 2017 tax reporting year we will continue to use our “outgoing” notification tool to notify those branches/Direct Investing who have clients whose accounts require manual adjustments or have special delivery requirements. This is referred to as “Hold Mail” and there is a separate mailing stream for these types of adjustments. Certain amendments are unavoidable in the sense that there will always be some accounts that require manual adjustments. With this notification system branches/Direct Investing will receive an email listing those client accounts that are affected by manual adjustments and thus the Hold Mail Stream. You will receive your first email notification by February 8, 2018. Once the manual adjustments have been completed and the packages have been mailed to your client, you will be able to view these packages on our online DOCUnet system. You will be able to view both the “Hold Mail” tax package as well as the “Amended” tax package. Therefore, your email notification will provide you with an estimated time frame of when your affected client will receive their adjusted tax package and when you can expect to see it on DOCUnet.

Hold Mail Frequently Asked Questions: My client has received the amended hold mail package. When filing, will they require the original tax document with the error or just the portion that has been amended? The amended hold mail package will contain the whole package that includes what has been amended. For example if the T5 tax slip required amendment just the T5 and the related Summary of Investment Income and Expenses along with the original tax documents that were not amended and related peripherals would be delivered to the client.

WHAT’S NEW FOR 2017 YEAR-END TAX REPORTING?

EQUITY LINKED NOTES REPORTING:

A linked note is a debt obligation on which the return is linked to the performance of one or more reference assets or indexes over the term of the note. Under pre-2017 tax rules, the increase in the value of the note, when held to maturity, must be treated as interest income by the holder of the note. Where the note was sold prior to maturity, vendors treated this increase as a capital gain, which in effect converted interest income to more favorably taxed capital gains. To ensure that any positive return on a linked note retains the same character whether it is earned at maturity or prior to maturity in a secondary market sale, the 2016 federal budget proposed a deeming rule that would apply to sales of debt obligations prior to maturity. This deeming rule would treat any gain realized on the sale or transfer of a linked note as interest income that accrued prior to the sale of the note.

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The tax reporting requires a T5008 slip issued to the note holder when the debt obligation is sold prior to maturity. The T5008 slip is required to report the proceeds of disposition less the deemed interest. Client tax reporting also requires a T5 slip to report the deemed accrued interest pursuant to subsection 20(14.2) of the Income Tax Act (Canada). For more details Equity Linked Notes

GENERAL INFORMATION, INQUIRIES & SERVICE We are committed to serving client needs by delivering timely and accurate tax reporting as well as responsive support. Please review the following support services that will assist you during tax season.

I. WHO DO I CONTACT FOR ASSISTANCE?

For tax form or package information, inquiries - related to Dominion Securities and International Advisory Group– for both registered and Non-Registered - please contact your Middle office service

team. For information, inquiries and service related to Direct Investing Registered and Non-Registered tax reporting forms and packages, please contact the Client Accounting Group. We are working closely with the Client Services Team, Estate and Trust Specialists and our Direct Investing Client Services Group to ensure that the service coordinators are trained and equipped to answer your questions and address your concerns. As required, they will escalate problems for resolution to the Tax Reporting department.

II. WHAT CAN I ACCESS MYSELF IN THE BRANCH/CENTRE?

Duplicate Forms – Per the CRA approved methodology, please access and print all duplicate tax packages from DOCUnet. As outlined in the Overview Section of this document, duplicate slips will not be provided by head office. Tax packages, complete with RBC logos are available on DOCUnet on a timely basis. Please note there is no requirement to provide these slips on official RBC letterhead.

Amendment Forms – Amended tax packages will be available for online viewing on DOCUnet for the 2017 reporting year. All amended tax packages will be loaded to DOCUnet within 2-3 business days of the client mailing. If the package is not available on DOCUnet within this timeframe please contact your Middle office service team.

2017 Survival Guide for Tax Reporting – This guide is designed to provide you with information you’ll need to service client inquiries. Please review the contents of this guide prior to contacting your Middle office service team.

2017 Sample Tax Package - The sample tax package highlights what clients should expect to receive on top of the tax receipts, including tools, tax guides, and a breakdown of the advantages our tax package has to offer when filing to the respective government agencies. The sample tax package can be found on our Tax Reporting website at the following link,

http://advisornet.fg.rbc.com/taxreporting/cid-228937.html or on the RBCDS public website at

http://rbcnet.fg.rbc.com/taxadvisorygroup/file-877898.pdf


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http://www.rbcds.com/TaxReporting/sample-tax-package.html

Advisornet – The Tax Reporting site will provide timely and relevant information during tax season and we encourage you to visit it daily. The site is accessible from the Home Page of Advisornet via an Account Admin tab located at the top of the page. Attached is the link to the tax reporting site,

http://advisornet.fg.rbc.com/taxreporting/cid-180846.html III. WHAT CAN MY MIDDLE OFFICE SERVICE TEAM ASSIST WITH?

Registered Accounts – All queries on RSP, LIRA, RIF, LIF, LRIF, PRIF accounts should be directed to your regional Middle office service team All queries on RESP accounts should be directed to your RESP Coordinator in the Special Products Department. For clients of RBC Direct Investing, please contact the Client Accounting Group.

Amendment Requests – To request an amendment (non-mutual funds) to a tax package, please submit a Servicelink request to the following queue:

Category > Reporting Subcategory > Client Tax Reporting Function > General Tax Inquiry All the instructions for amendment requests including Mutual funds and Advisor/PIM process for amendment are outlined at the end of this survival guide. IV. WHO ELSE CAN I CONTACT AT HEAD OFFICE?

Your Middle office service team should be your first point of contact. These individuals will be able to escalate your issues to the appropriate head office contact in order to ensure timely response times to your clients’ issues. In addition to your Middle office service team, the following head office contacts are here in order to assist you:

Technical/Interpretation Tax Inquiries – Clients are encouraged to consult with a qualified tax advisor before filing their tax return. In order to assist clients, we have prepared a number of Client Tax Guides that are available for viewing on the Advisornet Tax Reporting site. In addition, DS branches with specific tax-related questions may contact their Financial Advisory Support Representative. They can be reached via email at ‘Financial Advisory Support’ or via telephone at (1-877-722-3278). Direct Investing clients should review the information provided in the Client Guide to Tax Reporting available on the RBC Direct Investing website.

Book Cost/Summary of Security Dispositions – For all inquiries related to book cost, corporate actions and tax-deferred mutual fund switches, please contact the Book Cost Group using ServiceLink. Please submit the inquiry using the following queue, Select Case Type> Inquiry

Category > Reporting Subcategory > Book/Native Cost Request Type > Cost Inquiry

Sovereign and Lifepoints Portfolios – T3 reporting for clients who hold Sovereign and Lifepoints Portfolios will be issued by Frank Russell Canada. For amendment requests please follow the

http://www.rbcds.com/TaxReporting/sample-tax-package.html


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procedures located in the Mutual Fund Section of this guide on page 95. For duplicate requests or service please contact Frank Russell Canada at (1-800-467-9957).

TAX FORM GRID: DESCRIPTIONS, MAIL DATES AND ASSISTANCE

TAX FORM

DESCRIPTION

2018 ISSUE DATE

REFERENCE/

ASSISTANCE

SOURCES

T5 PACKAGE

T5

The T5 records the totals of dividend

and interest income earned by the

client. T5 slips are not generated for

clients with less than CDN $50 income

in the current tax year.

Mandatory CRA mailing date

Mar. 1. Forms mailed to

clients approximately Feb 14,

2018.

Duplicates available on

DOCUnet;

Amendment requests should

be sent via Servicelink to

your Middle office service

team/DI Client Accounting

Group.

Summary of

Investment

Income &

Expenses

This Summary lists all dividends and

interest received during the year, as

well as any interest paid.

See T5

DS - For further tax related

questions, please contact

Financial Advisory Support

at 877-722-3278 OR

through email at ‘Financial

Advisory Support’

R3

In addition to the T5, Quebec residents

must file the provincial form Releve 3.

Information provided is the same as

noted for the T5.

See T5

(See above)

NR4

This form records dividend and interest

income paid to non-residents of

Canada. This form is also issued on

payments from Registered accounts to

non-residents. NR4 slips are not

printed for clients with less than CDN

$10 income in the tax year.

*Note: Foreign source income is not

reported on a NR4.

Mandatory mailing date April

2nd. Forms are mailed to

clients approximately

February 14, 2018 as part of

T5 stream.

(See above)

Summary of

Security

Dispositions

This Summary lists all sales,

redemptions and maturities of securities

in client accounts as well as in-kind

contributions and substitutions to

registered plans made during the year.

*Note: Gain/Loss information is not

reported to CRA by our firm.

Mailed with T5 package.

(See above)

In addition, please direct

any book cost queries

directly to the Book Cost

Group using Servicelink.

Income Trust

Disposition

Gain/Loss

Worksheet

Tool that will assist in the calculation

of Gain/Loss of Income Trusts or

Split Corp Securities that have been

disposed of in 2017

Mailed with T5 package

Please see ‘T5 Package –

General Information’

section on Pg.13 for more

detail

DS Clients will receive a tax

brochure with their T5 package.

Access, Advisor, Private Investment

Management, and Parameters

mailto:Financial%20Advisory%20Support

mailto:Financial%20Advisory%20Support

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Client Tax

Guides

Program, account clients will receive

an enhanced Client Tax Guide

Direct Investing clients will be able

to access a PDF-format brochure on

both the Direct Investing website and

DI Online screens.

Mailed with T5 package. Guides/brochures will be

posted on the Tax Reporting

site on Advisornet.

TAX FORM

DESCRIPTION

2018 ISSUE DATE

REFERENCE/

ASSISTANCE

SOURCES

T3 PACKAGE

T3

Records income earned on Income

Trusts. T3 issued by RBC along with

a Statement of Trust Income

Allocations/Designations.

Forms produced and mailed in

multiple batch runs

commencing: March 06 until

completed in April 2018

Duplicates are available on

DOCUnet. Amendment

requests should be sent via

Servicelink to your Middle

office service team /DI

Client Accounting Group.

Records income earned on Mutual

Fund holdings from external mutual

fund companies

Forms are mailed directly by

the fund companies

throughout February and

March 2018.

Amendment request

procedures are outlined on

page 95 of this guide.

Records income earned on a select list of

RBC Private Pooled Funds Series O

See Income Trusts (above) See Income Trusts (above)

R16

In additional to the above T3s, Quebec

residents are required to file the R16 with

their provincial tax returns.

Same as T3

Same as T3

NR4

This form records distributions income

paid to non-residents of Canada.

NR4 slips are not printed for clients with

less than CDN $10 distribution in the tax

year. *Note: Foreign source distribution

income is not reported on a NR4.

Mandatory mailing date Apr

2nd. Forms are mailed to

clients as part of T3 package.

(see above)

(See Above)

Statement of

Trust

Allocations/

Designations

This Summary lists all income received

from Income Trusts.

Mailed with respective T3

package.

Same as T3

T5013 PACKAGE

T5013

Statement of Partnership Income. T5013’s

are issued in some cases by RBC and in

other cases by the general partner.

Forms are produced and

mailed in multiple batch runs

commencing Mar 06, 2018

until completed.


DOCUnet. Amendment


Serviceklink to your Middle

office service team /DI


R15

In addition to above T5013s, Quebec

residents are required to file the R15 with

their provincial tax returns.

Mailed with T5013 packages.


DOCUnet. Amendment


Servicelink to your Middle

office service team/DI


15

TAX

FORM

DESCRIPTION

2018 ISSUE DATE

REFERENCE/

ASSISTANCE SOURCES

T4 PACKAGE

T4RSP

Records assets removed from RSP

accounts through partial or full de-

registrations, estate pay-outs, refunds on

excess contributions, etc.

Mandatory mailing date

February 28. Forms are

mailed to clients on February

13, 2018.


DOCUnet. Amendment requests

should be directed to your Middle

office service team/DI Client

Accounting Group.

T4RIF

Records assets removed from RRIF

accounts through minimum pay-outs,

pay-outs above minimum, estate pay-

outs, etc.


February 28. Forms are


13, 2018.

See T4RSP

R2

In addition to the T4RSP/T4RIF, Quebec

residents are required to file the

provincial tax form Releve 2.

Information is the same as recorded on

the T4RSP/T4RIF.

Forms are mailed to clients

with the T4RSP/T4RIF.

See T4RSP

T4A

Records income payments made to the

beneficiaries of RESP accounts. A letter

with information on the grant portion of

the payments accompanies the form.


February 28. Forms will be


13, 2018.




office service team

R1

Quebec residents who receive an income

or grant payment from an RESP account

will also get R1. Information is similar

to that recorded on the T4A.

Forms are mailed to clients

with the T4A.

See T4A

NR4 Lists assets removed from a RRIF,RRSP,

RESP for non-residents of Canada


April 2nd.

See T4A

QI PACKAGE

1099-DIV

For US or Suspected US Persons.

Reports amounts such as dividends,

capital gain distributions, return of

capital, or non-taxable distributions that

were paid on stock distributions.


January 31. Seeking a 30-

day extension with the IRS.

Further updates to be posted

to Advisornet later in the

season.




office service team/DI Client

Accounting Group. For IRS-

related tax questions, please

contact Financial Advisory

Support or www.irs.gov

1099-INT

For US or Suspected US Persons:

Reports interest income

See 1099-DIV

See 1099-DIV

1099-OID


Reports Original Issue Discount (OID).

A debt instrument generally has OID

when it is issued for a price less than the

stated redemption price at maturity.

See 1099-DIV

See 1099-DIV

1099-MISC

For US or Suspected US Persons:

Reports US Limited Partnership (LPU)

distributions treated as US effectively

connected income and US Royalty

income earned. For substitute payments

on securities lending transactions.

See 1099-DIV

See 1099-DIV

1099-B Summary


Reports proceeds from sales or

redemptions of securities, futures

transactions, commodities and barter

exchange transactions. Report cost basis

for certain types of securities.

See 1099-DIV See 1099-DIV

http://www.irs.gov/

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TAX

FORM

DESCRIPTION

2018 ISSUE DATE

REFERENCE/

ASSISTANCE SOURCES

QI PACKAGE CON’T

1042-S

For non-US flow-through entities

including simple trusts, grantor trusts,

partnerships and non-qualified

intermediaries. Issued to beneficial

owners. Reports US source dividends,

interest, OID and substitute payments on

securities lending transactions.


March 15.

See 1099-DIV

OTHER YEAR-END MAILINGS

RSP

Contribution

Receipts

Reports cash and in kind contributions to

RSPs.

Contributions made in the

last 10 months of 2017 will

be mailed on Jan 09.

Contributions made from Jan

2 to Jan 12 will be mailed

Jan 17. Contributions made

from Jan 15 to Jan 26 will be

mailed Jan 31.

Contributions from Jan 29on

will be mailed weekly.

Duplicates can be found on

DOCUnet. For 2010 and beyond

tax year the copy on DOCUnet

will have “DUPLICATE” on the

form. If the form on DOCUnet is

from a previous year and has the

legend “THIS IS NOT A TAX

RECEIPT” a request must be

made to your Middle office

service team via Servicelink.

RIF

Evaluation

Letters

Shows:

(i) The value of the client’s assets

at December 31, 2017;

(ii) The minimum/maximum

amount that must be withdrawn;

(iii) The client’s desired payment

amounts and frequency, if

provided; and,

(iv) Reference temporary income

for Quebec LIF clients

Anticipated mailing date is

no later January 31, 2018.

Duplicates of DS/DI RIF

Evaluation letters will be

available on DOCUnet. All other

requests should be forwarded to

your Middle office service team /

DI Client Accounting Group.

Note: Special Situations

The Bank of Canada issues T5s for CSB income (except for a CSB that is held in non-certificated form in Bulk Segregation here at Canadian Wealth Management Operations).

Insurance Companies issue T5s for all earned annuity income.

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NON-REGISTERED TAX REPORTING : T5, SUMMARY OF SECURITY

DISPOSITIONS (T5008), T3, T5013 & NR4 GENERAL INFORMATION GENERAL INFORMATION: WHAT’S IN THE T5 TAX PACKAGE

Please refer to the tax package grid for a quick description of the components of the T5 tax package. The T5 tax package not only includes the applicable tax slips (T5, Summary of Security Dispositions) but specific client tools that will assist the client in filing correctly and on time. Although the tools are delivered on the T5 tax package many of these aid in other tax streams such as the T3 or the Summary of Security Dispositions. The following section details what we provide and the rationale for providing these valuable tools. I Reporting Tools in the T5 Tax Package and Functionality

(A) Income Trust Disposition Gain/Loss Worksheet Clients who have disposed of an income trust security in the 2017 calendar year will receive an Income Trust Disposition Gain/Loss Worksheet in their T5 tax package. This worksheet is to be used in conjunction with their T3 package(s) that they will receive shortly after the T5 package. Please review the graphic below for a sample of what is delivered in the tax package.

(B) Important Notice Regarding Book Value Information Clients who have disposed of any security in the 2017 calendar year will receive a Summary of Security Dispositions (T5008) in their T5 tax package. As a companion to this tax document we provide the ‘Important Notice Regarding Book Value Information’ that describes the intent of the document and adds further detail and meaning to the transactions listed including caveats that may have been used. (C) Foreign Assets - $ 100K CDN Reminder Clients who were Canadian residents during 2017 and held foreign assets with a cumulative cost of $100K CDN or more at any time during 2017 tax year should see the following message printed at the end of their ‘‘Important Notice Regarding Book Value Information’. Clients who see this message should review their reporting responsibilities regarding Federal Form T1135 and any new reporting requirements associated with this responsibility. Please keep in mind that this message produced is a generic one and with the recent changes to the T1135 reporting requirements we request that clients reconcile the CRA requirements with their tax and statement documentation to ensure compliance.

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In light of these changes, Dominion Securities does provide a report that mimics these requirements and will assist in this endeavour. (D) Notification of Forthcoming Tax Forms In order to inform clients that there may be follow-up tax slip mailings, the T5 package will include the following report (example shown). This document will prevent the client from filing to the CRA pre-maturely under the possibility of further slips to be delivered. Please note that this document will list all T3 reporting positions held during the tax year, irrespective of whether a tax slip is delivered or not. For example, mutual fund companies provide their own T3 forms directly to clients; as such Tax Operations cannot guarantee that one will be delivered. Nonetheless these positions will be listed on this document under the possibility of tax slip delivery. This purpose of this notification will be to remind clients to review their statements to confirm income and thus not to file their tax returns before receiving all tax documentation.

Important Information Regarding Outstanding Tax Documents:

Please note that in addition to this T5 tax package, additional tax forms may still be forthcoming if you held any of the following types of securities during 2017: Split Corps, Income Trusts, Limited Partnerships, Closed-End Mutual Funds, or Mutual Funds.

You MAY receive additional tax information if any of the securities listed below paid a taxable distribution during the 2017

reporting year. Our records indicate that you MAY soon receive additional tax forms for the following securities:

- E.g. Eagle Energy Trust Units We recommend that you do not file your income taxes until you have received all outstanding tax slips. Note: Tax slips for mutual funds are issued by the fund company directly. Important Note Regarding T3 Reporting for Income Trusts:

The delivery of T3 packages depends on the release of information by external issuers of income trusts to financial institutions. As a reminder, the Federal Government passed legislation effective 2007 requiring income trust and publicly-held limited partnership issuers to report by February 28. Despite this, you may still receive tax packages throughout March and April due to late disclosures and amendments by some income trusts and limited partnership units. We expect the 2017 tax year to have better adherence to the February 28 disclosure deadline, given that the legislation will have been in place for several years.

(E) Summary of Fees for Managed Products For the managed product family of accounts (Advisor, Access, PIM, A+, Parameters, PH&N, Estate & Trust), the tax package will include a summary of the fees charged to the account listed as well as any related accounts.

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(F) Client Guide to Tax Reporting The Client Guide to Tax Reporting is a handy booklet that breaks down each tax slip in laymen terms and provides answers to common tax scenarios that many of our clients face. The guide also features handy reference’s that client’s may require for tax reporting such as average foreign exchange for many currencies as listed by the Bank of Canada. (G) Securities and Income Report by Country The Canada Revenue Agency (CRA) requires that Canadian resident clients who hold specified foreign property with an aggregate cost totaling over C$100, 000 (and $250,000 for more detailed reporting) during a calendar or fiscal year end must report this information to the CRA on a Foreign Income Verification Statement or also known as form T1135. As of June 2013, CRA requires more detailed information on applicable foreign holdings such as its maximum market value, income produced and its country code as a few examples. Although the fulfilment of T1135 reporting is not a broker obligated task or filing, it is recognized that we must assist our clients in reporting foreign assets they hold at Dominion Securities and further enable them to have an uncomplicated tax reporting season. In fulfilment of this service, tax reporting has made available, since 2014, such required information in an on-demand report that can be generated from FlexPak. This report will provide, for the most part, the required elements for T1135 reporting for both the ‘Simplified Reporting Method’ and the Detailed Reporting Method’. This will allow for it to be completed in a much more user friendly format. Some highlights of the reporting include:

1) Calendar and fiscal year end reporting: reports include information on assets 2) Unrestricted cost reporting: allows for report availability for clients who may have specified

foreign property outside of Dominion Securities

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3) Country-by country segregation of property 4) Monthly and Year end capture of aggregate market value and income 5) Detailed reporting of specified foreign property to allow for easier reconciliation

As a reminder the report produced may contain slight inaccuracies so it is imperative that reconciliation with client statements, confirmation slips, and the yearend tax package do occur at the client level. The on-demand report will not be mailed to clients in any tax stream for the 2017 tax year but as stated above can be generated in Flexpak to the needs of the T1135 specific to the client. For more information please see the following CRA website for more details: https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/information-been-moved/foreign-reporting/foreign-income-verification-statement.html Flexpak Addendum to the Securities and Income Report by Country Continuing on the success of the Securities and Income by Country that was provided in the 2014 tax year, we will also be providing a FlexPak based addendum to the Securities and Income by Country report called the “DS- Foreign Property Threshold Non-Registered Account List”. The following are the features that will assist the client in filing:

1) The new DS- Foreign Property Threshold Non-Registered Account List” will assist in identifying accounts that hold foreign property. More importantly, it will provide the total Canadian equivalent cost value at its highest point during the year in question per each account. Unlike the cost value on the Securities and Income by country report, which is

https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/information-been-moved/foreign-reporting/foreign-income-verification-statement.html


21

reported on a monthly basis, this report will conform to the CRA requirement and calculate cost on a daily basis providing a more accurate highest point value. Please see the graphic below:

2) The branches can also retrieve the details that underlie the Canadian cost listed on the account. Also in FlexPak, the report can be created that lists all the daily high costs viewed on a monthly basis and the date it was achieved within that month. These values can be retrieved on an account, or for clients that have several accounts, on a portfolio basis. Please see graphic below for more details.

22

Please note as the graphic warns (highlighted), it is possible that Canadian cost values could be suspect, overstating or understating its value so it is important that teams review their reports and update whenever possible. There will be a warning of this situation as indicated by the yellow highlight in the graphic. More to detail, a report can also be created that drills down to the assets that comprise the highest cost month during the year that will be applicable for T1135 reporting. Please see following graphic:

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3) Several Improvements to the Security and Income Report by Country tool a) Position Detail by Security: Details for each security contributing to the foreign property

grouped by country. Details such as highest month end CDN cost, highest month end market value in Canadian, gain/loss in Canadian and CAD income for each security.

b) More accurate CRA requirements: gross income includes stock distribution values, new accounts for interest sold amounts, excludes High Interest Savings Accounts and all put options, complete country information, accurate settlement dates and settlement date foreign exchange dates

For more information on these changes please see the following links, http://advisornet.fg.rbc.com/flexpak/cid-396100.html


For more information please see the Foreign Income Verification section (G) on pg.23 or the following CRA website for more details, https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/information-been-moved/foreign-reporting/foreign-income-verification-statement.html

Securities and Income Report Frequently Asked Questions:

What is the purpose of the Securities and Income Report? The purpose of this report is to assist clients who are required to complete a T1135 with some of the demands the filing asks for. Such items that will assist in this endeavour will be:

1) Calendar and fiscal year end reporting: reports include information on assets as far back as July 2013 2) Unrestricted cost reporting: allows for report availability for clients who may have specified foreign

property outside of Dominion Securities 3) Country-by country segregation of property 4) Monthly and Year end capture of aggregate market value and income 5) Detailed reporting of specified foreign property to allow for easier reconciliation

Where and when can the Securities and Income Report be available? The report, in an excel format, will be available beginning in the 2014 tax year and will be pushed to branches and/or Investment advisor e-mail box based on IA code for manipulation according to the need of the client subject to T1135 reporting. This report will be made available periodically to cover for clients that require a fiscal reporting update.

Why do the amounts shown in the Income Table not align with the client’s T5? The T5 for a US account is in US$. The Securities and Income Report has converted the distributions to CAD at the FX rate on the date of each transaction. Therefore, the number will definitely be different.

Moreover, the tool provides the gross income into the account in CAD, this may vary from T-slips because of credits applicable on T5013, and, some T3 slips have included a January 2018 payment for the 2017 calendar year, whereas the tool only sees transactions that actually occurred during the year.

Why do the amounts shown in the Gain Loss Table not align with the client’s Summary of Security Dispositions? The tool only includes SELL transactions and therefore other types of dispositions (MV transfers/reorgs) are not

included.

http://advisornet.fg.rbc.com/flexpak/cid-396100.html





24

T5 TAX REPORTING

II T5 Tax Reporting and Functionality

As part of our CRA obligations we are required to issue clients a T5 tax slip listing all dividend and interest income earned by the client during the tax year. This obligation is met by providing the T5 tax slip to clients in the T5 tax package that is issued in mid-February. The Summary of Investment Income and Expenses is also delivered and used in support of the T5 tax slip. (A) T5 Tax Slip The T5 tax slip records the totals of dividend and interest income earned by the client during the tax year from all non-trust sources (i.e. Royal Bank of Canada, Bell Canada Enterprises), including foreign positions. Tax operations will provide an individual T5 tax slip in the currency that the income was received into the account, as applicable. RBC is obligated to mail these slips prior to the beginning of March every year and file the information contained to the Canada Revenue Agency. For this year, we anticipate these forms mailed to clients approximately Feb 16, 2018. Please review graphic below. In addition to the T5, Quebec residents must file the provincial form Releve 3. This slip will be provided in the T5 tax package as applicable. Information provided is the same as noted for the T5. The only difference between the slips will be the gross up and credit calculations as Quebec has specific values attributed to their residents. Please keep in mind we do not generate T5 tax slips for clients with less than CDN $50 income in the current tax year.

T5 Reporting Frequently Asked Questions:

My client earned income from a Capital Trust Security yet they do not see it reported on their T5 Tax ticket. Can we have an updated T5 reflecting this income? No amended tax slip will be issued in this case. For the majority of cases income earned from these types of securities are not reported on the T5 but rather the T3. The income payable from these securities (also known as ‘transferable trust units’) is expected to be treated as income from a trust. There may be some Capital Trusts that are still reported

25

on the T5 in which case the income produced from the trusts’ asset is considered interest and subject to all rules thereof. Please review the following link that lists securities deemed appropriate for T3 reporting, http://advisornet.fg.rbc.com/taxreporting/cid-294455.html

My client earned income from a Discount Instrument yet they do not see it reported on their T5 Tax ticket. Can we have an updated T5 reflecting this income? No amended tax slip will be issued in this case. Income earned from these types of securities is not reported on the T5. The proceeds and the costs are reported on the Summary of Disposition in the year of maturity (unless sold prior to maturity). Please refer to your Client Tax Guide for further details.

My client earned interest and dividends in British Pounds and a tax receipt was issued in British Pounds. The client then asked for the interest to be amended to CDN. What do we do? No amended tax slip will be issued in this case. Tax slips are issued in the currency of the account. Income is reported in the currency of the side of the account in which it was received. In very special circumstances where all 2017 income is moved and back dated another currency side of the same account the tax slips will be amended accordingly. This option is only permitted in rare circumstances, and results in currency conversion issues that will cause delays in amending. This procedure is therefore not recommended by Wealth Management Operations.

My client received a T5 slip on GIC income from both RBC and Issuer. What should I do? Your client’s T5 slip will be amended to reflect the information provided by the Issuer. Please follow the amendment request process under the Tax Reporting website on Advisornet. Please attach a copy of the T5 issued by the Issuer and the RBC issued T5 will be amended. Your Middle office service team will be able to follow up on the status of your amendment request.

My client did not receive a T5 for his Canada Savings Bond (CSB) held in safekeeping. What should I do? There are two ways a CSB can be held: certificate and non-certificate form. CSB’s in non-certificate form are held at Dominion Securities (DS) or Direct Investing (DI) in segregated bulk (SB) of which RBC is responsible for T5 tax reporting. CSB’s in certificate form are held at DS/DI in safekeeping (SK) of which The Bank of Canada will issue T5’s for its interest. Such questions about the CSB in certificate form can be inquired at the Bank of Canada.

My client did not receive a T5 for interest earned on their GIC. What should I do? The CRA requires that financial institutions provide T5 tax slips to Canadian residents who have received GIC interest or who have accrued GIC interest in any given year. Given this, RBC provides T5 tax slips under the following scenarios: GIC with term over one year - Accrued interest is reported to the anniversary date of the GIC's issue. The anniversary day is: ■ the day that is one year minus a day after the day the contract was issued (and every successive one-year interval after that day); or ■ the day the contract was disposed of. GIC with term of one year or less - If a GIC has a term of one year or less than the interest is reported on the T5 when it is paid. There is no requirement to report accrued interest at calendar year-end.

My client received a T5 for an Individual Pension Plan account (IPP). What should I do? As the Registered IPP exists in the non-registered account range, our systems cannot distinguish these accounts from normal non-registered accounts and thus are included for non-registered reporting. Your client’s tax slip can be cancelled and steps can be taken to prevent future tax reporting by populating the CUST TYP field with 225. Please contact your Middle office service team for further details. Please see section E) vii) for further details.


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(B) Summary of Investment Income and Expenses The Summary of Investment Income and Expenses is used in support of the T5 Tax Receipt and applicable Releve 3, the Summary of Investment Income and Expenses lists all investment income (interest and dividend) that was received during the tax year from all sources, foreign or otherwise other than mutual funds. Similar to the T5 tax ticket, separate summaries for each currency in the account will be provided for each tax receipt. The Summary of Investment Income and Expenses lists the expenses incurred to acquire securities such as accrued interest and margin interest under the ‘Paid By You’ column. Although the Summary of Investment Income and Expenses captures this information, it does not capture account fees (this is provided as a separate document for Advisor/PIM accounts see section). Moreover, the T5 tax slip does not ‘net-out’ the expenses listed on this summary against the income on the tax slip itself. Totals for each type of income received and incurred will be provided at the end of the summary.

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Summary of Investment Income and Expenses Frequently Asked Questions:

My client paid interest as indicated in the Paid by You column of the Summary of Investment Income & Expense. The client has asked for the interest to be netted with the interest earned (Paid to You) for T5 tax reporting. What can we do? No amended tax slip will be issued in this case. Since only the Paid to You amount is reported on the T5 tax slip we would not be able to ‘net out’ any Paid by You amounts on the T5 tax slip. However, the amounts in Paid to You may qualify as an investment expense on your tax return.

My client paid accrued interest as indicated in the Paid by You column of the Summary of Investment Income & Expense. How is accrued interest calculated? In this particular case accrued interest is the monies owed to the seller of the fixed income instrument that was purchased in the secondary market in between coupon payments. Since the full coupon payment from the issuer will be paid to the last owner, in this case the buyer, the buyer will not be the full owner of the interest payment and consequently will have to pay a portion of the eventual interest received to the seller at the time of purchase. Detailed Calculations of accrued interest owed by the purchaser in 1st Year (for following years add prior years interest to Face Value to calculate accurate accrued interest) Accrued Interest = (X/365 days) x I x FV Where X is number of days seller was owner of the bond since the last coupon I is the coupon rate (interest rate of the fixed income product) FV is the face value of the bond (amount purchased without premium or discount paid) E.g. Client purchased a C$10,000 Face Value of a 5% interest rate Bond that pays semi-annually on January 1st and June 1st of every year in the secondary market. The trade settled on October 23. What is the accrued interest owed to the seller and captured in the “Paid By You” column? (144 days/365days) x 5% x $10000 = $197.26 Accrued interest is calculated as $197.26 of the $250 coupon payment due January 1st is owed to the seller.

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(C) Releve 3 Tax Slip The Releve 3 tax slip is the Revenue Quebec version of the T5 that records the totals of dividend and interest income earned by our Quebec resident clients during the tax year from all non-trust sources (i.e. Royal Bank of Canada, Bell Canada Enterprises), including foreign positions. This slip is a mirror image of the T5 tax slip with the differences lying in the credits amounts provided for eligible and ineligible dividends. For the 2017 tax year the credit amount is 11.9% for Quebec Residents. The slip is provided in the T5 tax package attached to the T5.

(D) Special Reporting for Specific Type of Securities i) Split Corps Securities Interest/Dividend and disposition reporting on Split Corps securities will be reported in an additional T5 package. Due to the fact that issuers do not provide distribution information until mid-February, clients holding these securities may experience a delay in receiving their additional T5 slip. These slips will be available on DOCUnet for online viewing. Updates will be posted to Advisornet during tax season regarding the status of these packages. ii) Index-Linked Notes The principal and interest on these investments is commonly paid at maturity. However, when the accrued interest becomes known, it must be reported to the holders yearly as income. For details refer to Taxation of Index-Linked Notes under the following: http://advisornet.fg.rbc.com/wealthmanagementservices/cid-176419.html We will make adjustments to include the accrued interest on the Summary of Investment Income (Paid to You) on these securities. Accrued interest on buys (Paid to You) and sells (Paid by You) will also be adjusted on the Summary. For sells, the disposition amount (reduced by any accrued interest received) on the Summary of Security Dispositions will be adjusted. The affected securities are at the following link: http://advisornet.fg.rbc.com/taxreporting/cid-180885.html iii) ‘Hybrid’ Preferred Securities

http://advisornet.fg.rbc.com/wealthmanagementservices/cid-176419.html


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Adjustments will be made to accrued interest on buys (Paid by You) and sells (Paid to You) of these securities. A roster of the securities affected can be found in Advisornet in the Fixed Income category under http://advisornet.fg.rbc.com/fixedincome/cid-346035.html, or look for ‘Preferred Securities C$/U$’. These adjustments are made because these securities are treated like equities. However, these securities also pay interest and the underlying prospectuses of these securities make reference to the need to account for accrued interest in determining taxable income. Secondary market sells of these securities may also result in required adjustments to disposition amounts (reduced by any accrued interest received, comparable to bonds) shown in the Summary of Security Dispositions. Book costs for Hybrid securities will be reported on the Summary of Security Dispositions for the 2017 reporting year.

iv) Capital Trust Reporting

Clients who have received income from a Capital Trust security (also known as TruCS, BATS, BOaTS, CaTS, and SLEECS) during the 2017 tax year will have its income reported on the T3 tax slip. The income payable from these securities (also known as ‘transferable trust units’) is expected to be treated as income from a trust. There may be some Capital Trusts that are still reported on the T5 in which case the income produced from the trusts’ asset is considered interest and subject to all rules thereof. Please review the following link that lists securities deemed for T3 reporting, http://advisornet.fg.rbc.com/taxreporting/cid-294455.html (E) Special Reporting for Specific Type of Accounts and Scenarios i) Joint Accounts Although T5 tax slips for joint accounts are issued in the name of two (or more) individuals, the Canada Revenue Agency (CRA) only requires one Social Insurance Number (SIN) to be included on the T5 tax slip. Therefore, only the primary account holder’s SIN number will be displayed on a joint account T5 tax slip. Please note we are unable to issue more than one T5 slip in this case as per CRA requirements. ii) Corporations with Non-Calendar Year Ends Canadian Wealth Management Operations mails T5 tax reporting information to corporate clients by February 28th as per the Canadian Revenue Agency (CRA) mandated deadline. All tax related information is generated and produced with client data as at December 31st as per our obligations under Canada Revenue Agency regulations. (CRA) Tax reporting for corporate accounts follows this same process. The Tax Reporting Department cannot provide individually tailored tax reporting documents during the year for corporate accounts with fiscal year ends other than December 31st. The RBC Tax Advisory Group has confirmed there is no requirement under the income tax regulations (CRA) to provide early tax reporting documents for corporate accounts. For further details please visit the following link. http://advisornet.fg.rbc.com/taxreporting/cid-180854.html iii) Individual Clients - Request for Tax Package Prior to Mailing Date Canadian Wealth Management Operations mails T5 tax reporting information to individual clients by February 28th as per the Canada Revenue Agency (CRA) mandated deadline. All tax related information is generated and produced with client data as of December 31st as per obligations under the Canada Revenue Agency (CRA). Tax Reporting for individual clients follows this same process. The tax reporting department cannot provide T5 tax packages prior to the mailing in mid-February. The RBC Tax Advisory Group has confirmed there is no requirement under the income tax regulations (CRA) to provide tax packages earlier then normally possible as long as the February 28th mailing deadline is met. iv) Estate Tax Reporting – Estate Splits

http://advisornet.fg.rbc.com/fixedincome/cid-346035.html




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Canadian Wealth Management Operations mails T5 tax reporting information to clients by February 28th as per the Canada Revenue Agency (CRA) mandated deadline. All T5 slips are generated and produced with client data as at December 31st. T5 tax reporting for estate accounts follows this same process. The Tax Reporting Department will not provide T5 tax slips during the year for estate accounts. The RBC Tax Advisory Group has confirmed there is no requirement under the Income Tax Regulations (CRA) to provide early T5 tax slips for estate accounts. For details please visit the link, http://advisornet.fg.rbc.com/taxreporting/cid-180853.html NOTE: Further to the above, beginning with 2018 reporting year, CWMO will not be able to continue providing income splitting for joint or estate accounts. According to CRA there is no requirement to produce a T5 slip up to date of death and a second slip after date of death. The onus is on the beneficial owners or the Estate’s Executor to report the appropriate share of income in the tax return of the deceased individual. v) Premium Distribution Dividend Reinvestment Plan Premium distributions income earned that was allocated to accounts in 2017 is taxable and classified on a T5 slip as “other income.” Although income earned from income trusts is reportable on a T3 slip, the premium distribution portion is reportable on a T5 slip. vi) Foreign Spin-offs For Canadian tax purposes, the fair market value of foreign spin-off shares received by a Canadian resident in a non-registered account is considered to be a taxable foreign dividend and must be reported to the CRA on a T5 slip. Legislation allows clients to use an alternative tax-free treatment on approved foreign spin-offs. This alternative is only applicable under several conditions fulfilled by both the parent company and the client. The conditions consist of CRA designated spin-off criteria together with the parent company filing its intention with the CRA within a specified time frame. Moreover, the client completes a shareholder election with their income tax return. Please review link below for further details. Even though clients file an election, the CRA requires that the full fair market value of the spin-off is reported on the T5 slip. The book value shown on your monthly statement for a foreign spin-off share will be the taxable foreign dividend amount. The book value of the parent company shares will remain unchanged. Although RBC Capital Markets & Securities Operations does not report the book value shown on your client’s monthly statement or Summary of Security Dispositions to the CRA, if clients have elected an alternative tax treatment, it is suggested that clients speak to their advisor about changing the book value shown on future monthly statements. For additional information regarding Foreign Spin-offs please visit the following link or contact Financial Advisory Support. http://advisornet.fg.rbc.com/wealthmanagementservices/cid-279188.html

vii) Individual Pension Plan Accounts Individual Pension Plan accounts (IPP) are registered pension plans that are housed in our non-registered range and recognized by the tax systems as such and subjected to non-registered reporting. As a pension plan, these accounts should not be subject to non-registered (i.e. T5, T3, T5008,) tax reporting but due to its existence in the non-registered range reporting, is occurring. If requested, we can cancel the tax slip accordingly and make adjustments to the account so future production of tax slips is inhibited. Please contact your middle office service team to complete this ask. T5008 TAX REPORTING - SUMMARY OF SECURITY DISPOSITIONS



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Please refer to the tax package grid on pg. 16 for a quick description of the Summary of Security Dispositions. As part of our CRA obligations we are required to issue clients a T5008 Summary listing all sales, redemptions, in-kind contributions and maturities for the tax reporting year. This obligation is met by providing the Summary of Security Dispositions to clients in the T5 package that is issued in mid-February. The Summary of Security Dispositions (SSD) is a tailored version of the T5008 Summary and is not referred to as a T5008 Summary. The SSD also reports additional information which includes the book value and gain/loss information for each transaction as well as totals for all three categories. This provides an added source of tax information that clients may want to use to prepare their personal income tax filing. As in previous years and consistent with the presentation of cost information on client statements, the 2017 Summary of Security Dispositions will feature cost information from the ZCBA Book Cost system. I Summary of Security Dispositions Reporting and Functionality

The following section details what and how we report positions on the Summary of Security Disposition and the rationale for reporting. As the Summary of Securities Disposition is a more tailored version of the T5008 there is a number of functionality advantages that will described in this section. This section details each utility and outlines the functionality and the advantages to the client. (A) Reporting to the Canada Revenue Agency (CRA) In order to report the amounts listed in this Summary as taxable gains or allowable capital losses on the 2017 T1 General personal tax return, the relevant tax form is Schedule 3 “Capital Gains (or Losses) in 2017”. Schedule 3 has five columns and is divided into several sections, each of which describes a different type of property. Most investments on the Summary should be reported in either the “Mutual

fund units and other shares including publicly traded shares” section or the “Bonds, debentures,

promissory notes and other similar properties” section of Schedule 3.

The Summary is intended to be a supplemental document only, and clients should be cautioned to review it closely and compare the information provided to underlying monthly statements and / or trade confirmation slips before finalizing their tax return.

While RBC Wealth Management must report security dispositions to the Canada Revenue Agency (CRA), and Revenue Quebec, at no time is book value information or Gain/Loss calculations disclosed to any government authority by tax operations. The only items that are reported to the CRA are the date of the transaction, quantity, Security and the disposition amount.

(B) Book Cost Information The Book Value Column of your Summary of Security Dispositions reflects the cost to purchase the security and any subsequent purchases including any programmed purchases such as Dividend Reinvestment Plan. Subsequent purchases will be calculated on an average purchase price. The book cost information shown reflects the same book cost information that was reflected on your client’s monthly account statements during the past calendar year. For non-Canadian denominated positions, the reported cost in Canadian is determined using the base currency average cost converted and using settlement acquisition date FX rate. ‘Blank’ Book Cost positions If there are any suppressed (blank) positions in the book cost column, this may be attributable to a number of reasons, including: incomplete book cost information provided by the client; multiple acquisition/disposition transactions in a security processed on the same day.

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For those clients who are provided ZCBA book cost information, please note that the Summary of Security Dispositions may show blank cost figures for certain securities. Some of the reasons why a position may have a blank cost figure are below:

SE/ME/NE-flagged Positions: Securities that were sold [whole or in-part] during 2017 while the positions were ‘flagged’ with an “SE”, “ME” or “NE” indicator will have cost information excluded (suppressed) from the Summary of Security Dispositions. A blank will also appear in the “Gain/Loss” column on the Disposition Summary. If you have concerns about whether or not a position was flagged at the time of sale, please review your monthly client statements or contact the Book Cost Department via a Servicelink inquiry.

Transfers: Where a security position was transferred in-kind into an account with an incorrect cost (and hence flagged with an SE flag), and the book value was not subsequently updated, the book value will not be shown on the Summary when a disposition occurs.

Limited Partnership Units/Seg Funds/GIA’s: As in previous years, dispositions of Limited Partnerships Units and Segregated Funds will show blank cost figures on the Summary of Security Dispositions. Blank cost figures appear because we do not receive taxable distribution information from issuers in time to adjust book values for the production of the T5 package or may require book cost adjustments after the year end that impacts accuracy. Moreover, inherent features of Limited Partnership Units and Flowthrough Shares may prevent accurate reporting of book costs and thus the need to suppress book values.

Limited Partnership Units Converted to Mutual Funds Consistent with 2017 reporting, the clients book cost for the mutual fund conversion will again be adjusted based on the Adjusted Cost Base (ACB) that the issuer provides in their press release around the time of the event where available. It has been determined that this book cost is a much more accurate number to use for tax reporting purposes. There may still be further possible cost adjustments required (i.e. return of capital) when the client files their personal income tax return and therefore clients are still advised to review these costs with a qualified tax advisor.

Transactions with Blank Book Costs Transactions with Blank Book costs will now be relocated to the section “REPORTABLE TRANSACTIONS MISSING BOOK VALUES AND REQUIRE YOUR CALCULATION/INCLUSION”. Not only will the totals now reflect accurately based on complete transactional information but it will now make it easier for the tax preparer to isolate transactions where more information is required to complete the tax reporting accordingly. Please see section (C)

for more details. The symbol "#" in the book cost column indicates book cost information provided by the client. We, or any of our affiliates, are not responsible in any manner whatsoever for the completeness or the accuracy of this information. Please note book value information is not provided to the CRA.

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More Detailed Calculations Please refer to the original purchase confirmation to determine the adjusted cost base for a particular transaction. However calculating the adjusted cost base is more complex in the following cases: 1) Holdings have been accumulated in the security over a period of time; 2) A dividend reinvestment program was utilized by the client; 3) The investment was a mutual fund and distributions have been reinvested; or 4) The investment was a royalty trust, REIT, or limited partnership The ACB for first three situations are all calculated the same way:

First, take the original purchase price and add the cost of all subsequent purchases plus all reinvested dividends or distributions - this will provide the total cost of the investment.

Next, divide the total cost by the total number of shares or units held - this provides an average share or unit adjusted cost base (ACB).

If all of your holdings in the security have been sold then all that is required is a total cost figure; enter this number in column #3 under the appropriate asset category of Schedule 3.

If only a portion of holdings in the security were sold, multiply the number of shares or units sold by the average share adjusted cost base and enter this amount in column #3 of Schedule 3.

Let’s look at an example: A client purchased 100 units of a mutual fund for $10/unit in 2014. In 2014 and each of the following years the client received a $100 distribution on the investment that was reinvested in additional units. What is the current ACB? The total cost of the investment or ACB $1,000 + $100 (2014) + $100 (2015) + $100 (2016) + $100 (2017)=

$1,400 The ACB on a per unit basis = $1,400 150 units* = $9.33 per unit *Represents assumed number of units held at the end of 2017.

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Many mutual funds also receive return of capital which was not reported by our firm prior to 2010. The client should take care to review any documents received from the mutual fund company and adjust their cost base accordingly when calculating their gain/loss. If a client sold an investment such as a royalty trust, REIT or limited partnership: In these cases, the client would also need to consider the tax implications of any distributions received and/or tax deductions claimed to determine the adjusted cost base. Many investments that provide a tax deferral benefit or a tax write-off may have an ACB that is lower than the original purchase price. Further, certain distributions from royalty trusts, REITs or Limited Partnerships may be classified as Return of Capital (ROC) or Notional (phantom) distribution (see: http://advisornet.fg.rbc.com/bookvaluesystem/cid-271764.html . ROC and Notional distributions do have implications for the calculations of ACB, as ROC generally reduces the ACB of the investment(s), whereas Notional distributions increase book cost. We suggest clients consult a qualified tax advisor for further details about ROC and Notional distributions.

Book Cost Frequently Asked Question:

My client noted that there were blanks next to selected Dispositions on the Summary of Security Dispositions included in their T5 tax package – why is this and can I get it fixed? All cost records for the Summary of Security Dispositions are provided by the ZCBA book cost system. If a position had any one of the applicable ‘flags’ (i.e. SE/ME/NE) at the time of sale, the cost record will be suppressed (blank) on the Summary.

(1) To investigate a particular book cost or native cost, please review the client’s previous account statements and/or confirmation slips to establish the appropriate cost figure;

(2) Please update this cost position in the ZCBA system; (3) To request an amended tax slip, please contact your Middle office service team and follow the amendment

request procedures; and, (4) For assistance with cost, corporate action cost information or tax-deferred switch please contact the ZCBA

department via Servicelink. Some cost values are suppressed due to multiple transactions processed same day, or cost reporting issues (such as incomplete information from LPUs and some GICs). (C) Disposition Transactions with Missing Book Values The Summary of Security Dispositions features a separate section where disposition transactions that are missing book values will be reported. Not only do all the totals reflect accurately based on complete transactional information but it makes it easier for the tax preparer to isolate transactions where more information is required to complete the tax reporting accordingly. As these blank book cost transactions are now reported in the section headed as, “REPORTABLE TRANSACTIONS MISSING BOOK VALUES AND REQUIRE YOUR CALCULATION/INCLUSION” they will no longer be included in the normal “EQUITY, BONDS and OTHER” section. Please see Graphic below for more detail. As the heading states, the placement of these transactions does not preclude the accurate reporting of the transactions to the CRA for the tax year in question. Rather, it will enhance the reporting allowing for easier identification of the lacking transactions for further investigation and increase the reliability of the totals section. All of the asset classes (i.e. Equity, options, etc.) previously found in the “Equity, Bonds & Other” only will be subject to this section under the criteria stated above. ‘Short Sales Transactions’, ‘Closed Option Positions Initiated in Prior Years’, ‘Discount Instruments’ are not included as part of this section. Native Cost functionality will still apply to the disposition value listed for these transactions in this

http://advisornet.fg.rbc.com/bookvaluesystem/cid-271764.html

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section and all transactions Canadian and foreign will NOT be separated into their respective currencies and be comingled under the one banner.

Transactions With Missing Book Values Frequently Asked Questions:

What is this section “Reportable Transactions Missing Book Values and Require Your Calculation/Inclusion” and

how does this benefit my client?

This enhancement was implemented for the 2013 tax year where disposition transactions with blank book costs will be isolated in a section titled, “REPORTABLE TRANSACTIONS MISSING BOOK VALUES AND REQUIRE YOUR CALCULATION/INCLUSION”. The transactions of this section will not be included in any of the totals and provide an accurate calculation. Although these transactions are still required to be reported to the CRA, its isolation will now make it easier to locate and provide for accurate calculation of gain/loss.

My client was able to retrieve the converted book cost that is associated with this foreign transaction. Can we have an

updated Summary of Security Disposition reflecting this cost?

Your client’s Summary of Security Disposition can be amended to reflect the newly received converted book cost information

and be moved accordingly to the Equities, Bonds & Other Section and Native Cost applied accordingly. This amendment will

also reflect on the gain/loss, and all totals as part of their calculation. Please keep in mind that book cost and gain/loss are

not filed to the CRA and any such amendments are for the client benefit only.

(D) Native Cost Functionality As part of the Native Cost functionality, implemented in 2010, cost and disposition reporting for non-Canadian transactions will now be listed in Canadian dollar terms in step with Canadian tax reporting requirements. As such, the non-Canadian dispositions on the Summary of Security Dispositions will now be converted to Canadian dollars using the transactional exchange rate with the cost base maintained in ZCBA under native cost. Consequently, the gain/loss and related totals will now be reflected in Canadian dollars. Please see graphic below. This functionality will not be available to Direct Investing and IIA group clients.

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Native Cost Frequently Asked Questions:

What is Native Cost and how does this benefit my client? Since 2011 tax season the Summary of Security Dispositions has featured Native Cost reporting. In effect, transactions in foreign currency will be converted to Canadian currency (C$) on the Summary of Security Dispositions. Previously, the summary displayed book cost, disposition amount, and gain/loss information in the currency of the transaction. As Canada Revenue Agency tax reporting requires filers to report in C$ currency, this now removes the step of clients having to calculate the conversion of each foreign transaction when completing their gain/loss filing.

With the implementation of “Native Costs”, my client would like us to re-issue his/her foreign positions in the Summary of Security Dispositions from prior years to reflect Canadian currency. Where can I get this adjusted? As this is a relatively recent initiative that has been baselined, we are unable to provide native cost for tax years prior to 2010 tax year. (E) Disposition Information The Disposition column of the Summary of Security Disposition reflects the proceeds from the sale, redemptions, in-kind contribution or maturity of the security in the tax year in question. This column will drive what is listed on the Summary and is reported to CRA by our firm. All relevant information such as Book Cost (if available), gain/loss (if available), and date of sale, type of transaction, quantity, and position will be linked to the disposition transaction. As part of the Native Cost functionality, implemented in 2010, disposition reporting for non-Canadian transactions will now be listed in Canadian dollar terms in step with Canadian tax reporting requirements. As such, the non-Canadian

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dispositions on the Summary of Security Dispositions will now be converted to Canadian dollars using the transactional exchange rate.

Short Sale Transactions (excluding options): Short sale transactions occur where a security is borrowed and then immediately sold in the market. For tax reporting purposes, the transaction is completed when the taxpayer later purchases the security and the purchased security is then used to repay the original borrowing. The tax implications of Short Sale gain or losses may differ from conventional dispositions of securities. As a result, book cost and gain/loss information does not appear in the short sale section of the Summary of Security Dispositions. Please note, all short sales are found in a separate section at the tail end of the Summary. For more detail on short/written options and its reporting please see section J) i).

Disposition Frequently Asked Questions:

My client was expecting a T5008 tax document but did not receive one in the T5 tax package. How can I obtain one? As part of our CRA reporting obligations we are required to issue clients a T5008 Summary listing all sales, redemptions, and maturities for the tax reporting year. This obligation is met by providing a Summary of Security Dispositions to clients in the T5 tax package. The tailored version is driven by sales, redemptions, and maturities in the tax year in question. (F) Gain/Loss Data Clients must report all investments that were disposed of during 2017 resulting in either a capital gain or loss to the CRA. Please note that gain/loss information is not reported to CRA by our firm. A

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capital gain or a capital loss occurs upon disposition or maturity of a security unless a taxpayer has determined that all transactions should be taxed on an income basis (i.e. taxable as regular income or loss). For most taxpayers, the sale of a security is a capital transaction, thus resulting in a capital gain or loss.

The 1994 Capital Gains Election & “V-Day”

1972 – V-Day valuation For investments purchased for settlement prior to December 31, 1971 (known as “V-Day”) one should determine the value of the security on that date. Capital gains only became taxable in 1972 therefore any gains that accrued prior to that date are not subject to tax. The V-Day value is used as a starting point for calculating the ACB of an investment and subsequent splits, dividend reinvestments or corporate reorganizations will need to be taken into account. The V-Day value of a publicly listed security can be obtained by calling Financial Advisory Support at 1-877-722-3278. 1994 – Elimination of the $100,000 Capital Gains Exemption As a result of the elimination of the capital gains exemption, a provision was included in the 1994 federal budget to allow investors to “crystallize” gains that had accrued as of February 22, 1994. This meant reporting gains on investments as if they had been sold, to take advantage of any remaining capital gains exemption. This amount may need to be further adjusted for any additional purchases or reinvestments after that date. Mutual Funds and the 1994 elimination of the $100,000 Capital Gains Exemption For investors that elected to crystallize gains on their mutual fund holdings, a separate Exempt Capital Gains Balance Pool was created for each fund. The pool for each fund had a 10-year life and was used to offset the tax liability that resulted from any capital gain distributions in addition to any gains recognized on redeemed units up to the end of 1994. Any balance that remained in the pool at the end of 2004 was to be added to the ACB of the fund resulting in the eventual reduction of the capital gain (or increase in loss) when the fund is sold. Investors and their tax advisors should review the ACB of any funds held prior to 1994.

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(G) Summary of Security Dispositions Totals Section The Summary of Security Dispositions will features, Gain/Loss, Disposition and Book Value Totals lines that sums each of gain/loss, disposition and book value amounts from disposition transactions made by the client during the tax year. It will now be easier for clients to locate required filing information for use in their tax filing without the step of having to calculate each position manually. The totals line will only be calculated for positions that are listed under the Equities, Bonds & Other section. For accounts that have Native Cost applied, all totals lines will reflect the native cost functionality as applicable for dispositions transacted in each foreign currency. Only values that are available will be included in the totals amount such that transactions that lack a book cost and consequently a gain/loss will also not be included in each respective totals amount.

Gain/Loss Frequently Asked Questions:

My client noted that subtraction of the Book Value totals from the Disposition totals did not equate to the listed gain/loss on the 2013 Summary of Security Dispositions included in their 2013 T5 tax package – why is this and can I get it fixed? This has been corrected since the 2013 tax year. In prior years it was possible that the book cost column could be blank for reasons listed in the book cost section. That being the case, when the system sums each column with the transaction disposition value present, the discrepancy between calculations will occur. Since 2013 tax year, where disposition transactions with blank book costs occur such will be isolated in a section titled, “REPORTABLE TRANSACTIONS MISSING BOOK VALUES AND REQUIRE YOUR CALCULATION/INCLUSION”. The transactions of this section will not be included in any of the totals and thus no more discrepancies in totals should occur. Please see section (C) for details.

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(H) Foreign Currency Disposition Reporting The Summary of Security Dispositions that list foreign disposition transactions will separate each transaction into the currency it was transacted in. Non-Canadian positions will no longer be listed and intermingled with any Canadian holdings and will now be listed separately under a header, denoting the base currency the position was held in the account and stating it has been converted into Canadian currency. Canadian transactions will have no headings and be listed first with foreign transactions to follow. The Native cost functionality will still be applied to each transaction’s disposition amount, book value amount and gain/loss. This should make it easier for clients to reconcile the transactions with their statements and make it clearer that the information reported on the summary has been converted to Canadian.

(I) Summary of Security Dispositions Symbols i) “CRA1” The Summary of Security Disposition will now suppress in-kind contributions where a loss has been calculated. The loss will be replaced with a ‘CRA1’ designation in the gain/loss column for affected transactions (See Graphic below). As the loss is suppressed, the capital loss will not be included in the Gain/Loss Totals. This suppression is in line with the Superficial Loss rule which disallows deductions associated with a capital loss for certain scenarios. For more information please see the CRA website, http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/rprtng-ncm/lns101-170/127/lss-ddct/sprfcl/menu-eng.html

http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/rprtng-ncm/lns101-170/127/lss-ddct/sprfcl/menu-eng.html

http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/rprtng-ncm/lns101-170/127/lss-ddct/sprfcl/menu-eng.html

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“CRA1” symbol Frequently Asked Questions:

My client noted that subtraction of the Book Value totals from the Disposition totals did not equate to the listed gain/loss on the Summary of Security Dispositions included in their T5 tax package – why is this and can I get it fixed? As the loss from an in-kind contribution is suppressed, the capital loss will not be included in the Gain/Loss

Totals. That being the case, when the system sums each column with the disposition and book cost value present, the discrepancy between calculations will occur. ii) “#” SIGN The symbol "#" in the book cost column indicates cost information provided by the client. Dominion Securities is not responsible in any manner whatsoever for the completeness or the accuracy of this information.

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(J) Special Reporting for Specific Type of Securities Due to the uniqueness of different classes of securities or actions taken by the security or the account itself, such as a reorganization or transfer respectively, disposition reporting could be limited or treated differently. The following scenarios describe the different treatment. i) SHORT/WRITTEN EXCHANGE TRADED OPTIONS We capture long open positions of exchange traded options (options) and most corresponding actions that follow, such as closing the position or expiry as any normal equity transaction. As part of our 2012 options functionality enhancement (Please see section J) - iii) we are capturing the result of an exercise of the long option as the position is removed (put) or received (call). Upon exercise, the cost of acquiring the option will be moved to the purchase (call) or sale (put) of the underlying stock. For the assignment of a short option we will not be moving the premium received to the sale (call) or the purchase (put). We will report the short option as discussed below and the client will have to make the appropriate adjustments on their tax reporting. With respect to short/written options, an enhancement was put in place where we are able to capture the taxable event of a short option in the year that the option was written. In the year of shorting the option, whether an action is taken to buy back the option, assignment or no action was taken via expiry, we will capture each event accordingly with client adjustments required for assignments as described previously. Native cost will still apply to the transaction as any position that lies in the Equity, Bonds, & Other section and will be included in the summation for each total in that section.

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Although this function will be able to list all option transactions that you process it will be limited in its ability to capture partial fills on the same day and several fills over the life of the specific option position if it is not filled in full. We are able to capture the taxable event of an option trade of certain fill choices, specifically any part orders that were completed over several days. In prior years those transactions would be left with a blank book cost and consequently blank gain/loss and be placed in the “REPORTABLE TRANSACTIONS MISSING BOOK VALUES AND REQUIRE YOUR CALCULATION/INCLUSION” section. As such, transactions otherwise subject to the totals would not be included and summed in these years. For this tax year and going forward, tax operations will be able to pick up any part, good thru transactions that fill over a day and are completely closed (sell to/buy to) by year end.

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Reporting for options will be based upon the capital account record keeping premise. We will leave any distinction such as income account record keeping to the discretion of the account holder when filing their tax reporting to the Canada Revenue Agency. Please review the following chart indicating the tax reporting taken:

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Transaction

Tax Implications

What's Reported on

Summary of Security

Dispositions

Related Comments

Short (Sell/Write) Calls

Write Call in year 1

and Still

Outstanding

Year 1: Capital gain/(loss)=

premium received less

commissions paid

Report sell transaction, $0 cost,

and gain/loss on Summary of

Security Disposition. Gain/loss

will be calculated based off of

$0 cost.

Possible future reporting on

the Summary of Security

Disposition based on future

actions on the option

position


and Buy Back in

year 1

Year 1: Capital gain/(loss) =

premium received less premium

paid less commissions paid

Report sell transaction on

Summary of Security

Disposition. Gain/loss will be

calculated based off of buy back.


and Assigned in

year 1 or future

years


assignment proceeds + premium

received less commission paid

less Adjusted Cost Base of

underlying security

Separate tax reporting of the

written option and the sale of the

underlying position on the

Summary of Security

Dispositions

Premium from short option

transaction not transferred

to the adjusted cost base of

the underlying position sold

(See section J) –iii)


and Expires in year

1



commission paid

Report expiry transaction, $0

cost, and gain/loss on Summary

of Security Disposition.

Gain/loss will be calculated

based off of $0 cost.

Short (Sell/Write) Puts

Write Puts in year 1

and Still

Outstanding



commission paid

Report sell transaction, $0 cost,

and gain/loss on Summary of

Security Disposition. Gain/loss

will be calculated based off of

$0 cost.

Possible future reporting on

the Summary of Security

Disposition based on future

actions on the option

position


and Buy Back in

year 1


premium received less premium

paid less commission paid

Report sell transaction on

Summary of Security

Disposition. Gain/loss will be

calculated based off of buy back.


and Assigned in

year 1 or future

years

Year 1: Adjusted Cost Base of

underlying security = (Strike

price) (# of contracts) (100) +

commissions paid less premium

received

Reporting of the assignment of

the written option will occur as

per normal rules of written

options (See section J)-i)).The

purchase of the underlying will

be reported in year of selling.

Premium from short option

transaction not transferred

to the adjusted cost base of

the underlying position

purchased. (See section J) –

iii


and Expire in year 1

Year 1: Capital Gain/ (loss) =


commission paid.

Report expiry transaction, $0

cost, and gain/loss on Summary

of Security Disposition.

Gain/loss will be calculated

based off of $0 cost.

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ii) SHORT/WRITTEN EXCHANGE TRADED OPTIONS PURCHASED TO CLOSE IN SUBSEQUENT YEARS As described in the previous section on short option reporting, Tax operations will report the gain/loss in the year shorted of all short options irrespective of whether the option is still open to be acted upon in subsequent years. For unexpired, open, short/written options that have been reported to the CRA on the Summary of Security Dispositions in the year shorted and have been bought back by the client in subsequent years, Tax Operations will provide this information in a separate section on the summary on a ‘for your information’ basis in the tax year the buy back occurs. We will not be reporting this buy back to the CRA, as this is a statement of dispositions, and will leave it to the client to adjust their tax reporting accordingly based on the information provided. As this information is provided on an informational basis only, these transactions do not include the initial opening sale of the written option from prior years nor will any of the values be reflected in any of the transactional totals. The information will be provided in a dedicated separate section titled ‘Closed Option Positions Initiated in Prior Years’ after the Totals section on the Summary of Security Dispositions.

Reporting for options will be based upon the capital account record keeping premise. We will leave any distinction such as income account record keeping to the discretion of the account holder when filing their tax reporting to the Canada Revenue Agency. iii) TRANSFERRING THE COST OF A LONG OPTION POSITION TO THE UNDERLYING SECURITY WHEN EXERCISED For long exchange traded option positions held in the client’s account, upon exercise (auto, client initiated) the premium cost of the option will be added to the affected underlying position increasing the book cost and decreasing the tax liability on any future sale (call) or present sale (put). This change is consistent with the tax reporting requirements for reporting exchange traded options to the CRA. The impact to the 2017 Summary of Security Dispositions will only be reflected in a long put scenario, since the sale of the underlying security is immediate when the long put is exercised. For long calls, the

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option premium is added to the underlying cost and the taxable impact of the underlying will be reported on the Summary of Security Dispositions once the sale of the long position is completed. Upon exercise and transfer of the premium, the option itself will be removed and not reported on the Summary of Security Dispositions since its premium and taxable consequence was moved to the underlying. We will not be transferring the premium of a short option position to any underlying positions. As such, the assignment of a short option will not entail the moving of the premium received to the sale (call) or the purchase (put). We will report the short options as discussed above (section J- i) and the client will have to make the appropriate adjustments on their tax reporting.

Transferring Cost of a Long Option to the Underlying Frequently Asked Questions:

My client noted that the exercised long put option was not on the on the Summary of Security Dispositions included in their T5 tax package – why is this and can I get it fixed? As part of our enhancement of transferring the cost of a long option to the underlying security, the put position, upon exercise will be removed from the client’s account and not included in the Summary of Security Dispositions since the cost of the put was already reflected in the sale transaction of the underlying. This is not an issue for call positions since the exercise of a call obligates the holder to buy the underlying position which is not listed on the Summary of Security Dispositions. iv) HIGH INTEREST SAVINGS ACCOUNTS REPORTING Funds withdrawn from a High Interest Savings Account (HISA) during the 2017 tax year will not be captured on the Summary of Security Dispositions. HISAs are considered ‘Funds on Deposit’ and as such a withdrawal or maturity transaction from these securities does not require T5008 reporting.

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High Interest Savings Account Frequently Asked Questions:

My client noted that High Interest Savings Accounts (HISA) is not included on the Summary of Security Dispositions included in their T5 tax package – why is this and can I get it fixed? Whenever a client sells (withdraws) funds from a High Interest Savings Account security, the transaction is captured on the Summary of Security Disposition as a disposition and incorrectly triggers a loss since the position face amount is being reduced. Since this disposition is reported to the CRA by DS, the client in turn will also have to report this 'loss' to the CRA incorrectly. To rectify this, Tax Operations has removed any HISA transactions from the Summary of Security Dispositions. v) LIMITED PARTNERSHIP UNITS/FLOWTHROUGH SECURITIES/SEGREGATED FUNDS/GIA As in previous years, dispositions of Limited Partnerships Units, Flowthrough Securities, Segregated Funds and Guaranteed Income Annuities will show blank cost figures on the Summary of Security Dispositions. Blank cost figures appear because we do not receive taxable distribution information from issuers in time to adjust book values for the production of the T5 package or may require book cost adjustments after the year end that impacts accuracy. With respect to Limited Partnership Units and Flowthrough securities we purposely suppress the book cost of these transactions on the Summary of Security Dispositions due to inherent tax functionality (i.e. Flowthrough) that can be used by the holder to adjust the cost of the position that may disqualify the cost base that Tax Operations applies. In light of this, these suppressed disposition transactions will be located in the “REPORTABLE TRANSACTIONS MISSING BOOK VALUES AND REQUIRE YOUR CALCULATION/INCLUSION” section. Please see section (C) for more details.

Limited Partnership Units/Flowthrough Securities/Segregated Funds/GIA Frequently Asked Questions:

My client noted that the Book Value for their Limited Partnership Unit is not included on the Summary of Security Dispositions – why is this and can I get it fixed? We purposely suppress the book cost of disposition transactions of Limited Partnership Units and Flowthrough securities on the Summary of Security Dispositions due to inherent tax capabilities (i.e. Flowthrough) unique to

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these types of securities. In light of this possibility, the cost of the position may not be its true cost base that Tax Operations holds. vi) LIMITED PARTNERSHIP UNITS CONVERTED TO MUTUAL FUNDS Consistent with 2017 reporting, the clients book cost for the mutual fund conversion will again be adjusted based on the Adjusted Cost Base (ACB) that the issuer provides in their press release around the time of the event where available. It has been determined that this book cost is a much more accurate number to use for tax reporting purposes. There may still be further possible cost adjustments required (i.e. return of capital) when the client files their personal income tax return and therefore clients are still advised to review these costs with a qualified tax advisor. vii) COMPOUND GIC’s Proceeds for sales of compound GIC’s include accrued interest which has been previously reported on the T5 tax slip. Since the disposition amount is incorrect due to the inclusion of the accrued interest portion the book value is suppressed to remove the gain/loss. viii) CERTIFICATE DEPOSITS Where a security position was deposited into an account without a book cost (and hence flagged with an SE flag), and the book value was not subsequently updated, the book value will not be shown on the summary when a disposition occurs. ix) MONEY MARKET FUNDS Price (therefore cost) is typically ‘pegged’ at an affixed amount at all times (i.e. $10.00 per UNIT). These fixed amounts will always remain as the cost for dispositions of such items unless the position is converted from non-Canadian currency where differences between acquisition and disposition date do occur. x) MUTUAL FUNDS BOOK COSTS Previously, the necessity of various systems requiring two separate security codes for mutual funds book costs for dispositions are always overstated when reported, but always by less than the value of one unit. Development has been completed where all mutual fund cost values, full and fractional, are now being carried under one security code for disposition transactions that were completed after September. Visually, there is no impact to the Summary of Security Dispositions in the tax package since both full and fractional transactions are already combined, but overstatement of values will now be minimized on the summary for this year. Going forward this discrepancy will be eliminated altogether. See graphic below.

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xi) TAX DEFFERRED MUTUAL FUND SWITCHES The entire disposition transaction is suppressed from the summary (not just book value) if the correct same day/same money’ logic is followed when the transactions were processed. A full review of our policies and procedures for the eligibility and processing of tax-deferred fund switches has been conducted over the past quarter. Please refer to the manual posted on Advisornet at

http://advisornet.fg.rbc.com/mutualfunds/file-475677.doc to ensure that your client’s holdings are being handled appropriately during tax season. More information about ‘F’ Units and Tax-Advantaged funds can be found in the “Mutual Funds” section of Advisornet. Improvement in Reporting Non-Taxable Mutual Fund Switches Normally, switches within mutual fund families are deemed non-taxable events that are not required to be captured on the Summary of Security Dispositions and subsequently not reported to the Canada Revenue Agency. There were certain factors, internal and external, that prevented accurate reporting of these events on the Summary of Security Dispositions. An enhancement in 2015 to the tax process has been put in place that triggers review of the table (ZMFR) that controls the taxability of switches as switch transactions get completed. This review process entails the comparison of taxable information provided by the fund company that will allow for a constant update of the table and consequently an update for the file that produces the Summary of Security Dispositions. In spite of a significant majority of our tax deferred switches reported correctly by not appearing on the Summary of Security Disposition, this will reduce the small population that should not have initially appeared on the report. Please see section K) - vii). xii) MANAGEMENT FEE MUTUAL FUND REDEMPTIONS Clients holding mutual funds may be subject to periodic selling of units of the fund held in order to accommodate fees required to administer the fund. This transaction will be captured on the Summary of Security Dispositions as a disposition and subject to any gain/loss reporting according to CRA regulations. xiii) INCLUSION OF BOOK COSTS FOR INCOME TRUST DISPOSITIONS

http://advisornet.fg.rbc.com/mutualfunds/file-475677.doc

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Book cost figures for dispositions of income trusts will be provided on the Summary. These book costs will be reflected as of December 31, 2017. Therefore, book costs for income trust dispositions will not reflect any return of capital adjustments for 2017. It should be noted that there are several additional items that can potentially affect the book value of income trusts that may not be reflected in the value shown on the disposition summary at the time of the transaction. For a complete listing please visit the following link: http://advisornet.fg.rbc.com/taxreporting/cid-180895.html xiv) CANADIAN RBC LINKED NOTES: RETURN OF CAPITAL COMPONENT The Return of Capital (ROC) on these investments is commonly paid at intervals set out by the terms of the product. We will make book cost adjustments to include the ROC on the position held in the account. The impact of this adjustment will only be reflected on the Summary of Security Dispositions as a taxable event upon the disposition of the holding and will reflect accordingly in the book cost and consequent gain/loss on the Summary of Security Dispositions. xv) SHORT SALE TRANSACTIONS (excluding options) Short sale transactions occur where a security is borrowed and then immediately sold in the market. For tax reporting purposes, the transaction is completed when the taxpayer later purchases the security and the purchased security is then used to repay the original borrowing. The tax implications of Short Sale gain or losses may differ from conventional dispositions of securities. As a result, book cost and gain/loss information does not appear in the short sale section of the Summary of Security Dispositions nor are there any totals attributed to this section. Please note, all short sales are found in a separate section after the totals. For more detail on short options & its reporting please see sections J) - i), ii), iii).

xvi) DISCOUNT INSTRUMENTS

The 2017 Summary provides a separate listing of discount instruments that matured or were sold during 2017. A discount instrument is a fixed income investment such as a Treasury bill (T-bill), strip,


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commercial paper or banker’s acceptance that does not pay regular interest to the investor and is issued at less than its face value. The disposition of a discount instrument at maturity will generate interest income. Discount instruments sold prior to maturity are covered below. What this means is that the difference between the price paid for a discount instrument (price on the original contract) and the price upon maturity (listed on the Summary) will be taxable as interest income. T-bills and commercial paper are normally short-term investments with a term not exceeding one year. If the T-bill or commercial paper has a term of one year or less, the client should report the interest income in the year of maturity, unless sold prior to maturity. For any discount instrument that has a holding period or term greater than one year, the client must report the accrued interest earned each year (for investments made in or after 1990). Calculating Accrued Interest on Discount Instruments:

Accrued interest represents the interest earned in the year, but not yet received. It is calculated by multiplying the purchase price of the instrument by its yield to maturity (as stated on the contract or the date of purchase). This accrual should be reported on an anniversary date basis (i.e. every 365 days) and not on a calendar year basis. For example, if a client purchased a strip coupon for $10,000 that was issued on July 1, 2015 and had a yield to maturity of 4%, the first accrued interest amount of $400 ($10,000 X 4%) would be reported on the client’s 2016 tax return. In this example, accrued interest is not reported on the 2016 tax return because the first anniversary of this strip will occur on June 30, 2017, which is part of the 2017 tax year.

Selling a Discount Instrument Prior to Maturity:

If a client sold a T-bill or strip prior to its maturity, the client may also have to report a capital gain or loss. Before calculating the capital gain or loss it is necessary to calculate the accrued interest that has been earned up to the point of disposition. Then a client must subtract the accrued interest from the proceeds of disposition (proceeds of disposition are listed on the “Discount Instruments” area of the Summary). The client can then proceed in the normal manner of calculating a capital gain or loss.

EXAMPLE: Client A purchased a T-bill for $9,900 on June 1, 2017 with a yield of 4.07%. The T-bill matures on September 1, 2017 (92 days) and its maturity value is $10,000. The client decides to sell the T-bill on August 10, 2017 for $9,980. The accrued interest and capital gain/loss are calculated as follows:

Accrued Interest Calculation:

1) Total interest payable at maturity = $9,900 x 4.07% x (91 365) = $100.00

2) Total interest payable at maturity x proration for holding period (number of days T-bill held total life of T-bill (days))

3) $100.00 x (71 91) = $78 accrued interest

Capital Gain/Loss Calculation:

Proceeds of Disposition $ 9,980.00 Accrued Interest $ (78.00)

Net Proceeds $ 9,902.00 Adjusted Cost Base $ (9,900.00) (taken from original contract)

Capital Gain $ 2

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All interest income should be reported on Schedule 4 – Statement of Investment Income – Part II. The total amount of Part II must then be reported on line 121 of the taxpayer’s individual income tax return form (T1 General). Any capital gain or loss recognized on the sale of a discount instrument should be reported on Schedule 3 “Capital Gains or Losses in 2017” in the section titled, “Bonds, debentures, promissory notes, and other properties”.

(K) Special Reporting for Specific Securities Actions i) IN-KIND TRANSFERS BETWEEN ACCOUNTS (Market Value or Book Value) Where a security position is transferred in-kind into an account with an incorrect cost (and hence flagged with an SE flag), and the book value was not subsequently updated, the book value will not be shown on the Summary when a disposition occurs. Market value transfers are reported as dispositions on the Summary of Security Dispositions. Note, for more information please see section K) vi) for more tax reporting details. Moreover, please see the following article from Financial Advisory Support that discusses this event, http://advisornet.fg.rbc.com/wealthmanagementservices/file-311230.pdf ii) REORGANIZATIONS (Exchangeable Shares, Spin-offs, and Stock Dividends) Certain taxable reorganization events where exchangeable shares are received, and the cost is undetermined or affected by a tax election, will be flagged or suppressed completely from the summary. Specifically, in the case of Spin-offs and Stock Dividends, a flag is placed on the new/additional shares as soon as they are booked into the client account. Once we receive the final cost information from the issuer (anywhere from a few days up to 6 weeks) and update the cost of the new/additional shares, the flag will be removed. The flag cannot be removed however, for any positions that are completely sold in bulk prior to the cost update as the ZCBA Book Cost system does not allow for removals of flags in this adjustment process. Therefore, bulk sales executed prior to cost

updates will have their book cost suppressed from the Summary of Security Dispositions and placed in a new section where blank book cost transactions are isolated. Please see section C on Pg. 37 for more details.

http://advisornet.fg.rbc.com/wealthmanagementservices/file-311230.pdf

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iii) TAX TREATMENT OF SELECTED CORPORATE ACTIONS/REORGANIZATIONS When a Reorganization (“reorg”) is deemed taxable, the Book Cost Department relies on information provided by the issuer in conjunction with our internal policies and guidelines to determine the specific treatment of the Reorganization for Canadian tax purposes. The chart at the following link provides examples of different types of Reorganizations and our processing guidelines for each one. http://advisornet.fg.rbc.com/taxreporting/cid-180892.html For a complete list of the Reorganizations during 2017 that have been adjusted for on the Summary of Security Dispositions. Please visit the following link. http://advisornet.fg.rbc.com/bookvaluesystem/cid-271745.html iv) NEW! COST FOR MULTIPLE BUYS AND SELLS ON THE SAME DAY OF SAME SECURITY The Summary of Security Dispositions (SSD) will now have the functionality to provide accurate cost information for transactions that involve a combination of multiple buys and sells on one day for the same security. Previously only multiple sells that occurred on the same day was captured accurately. As a result, all cost information associated with these transactions will appear on the Summary of Security Dispositions for this year contrary to previous years. This functionality will work for equity, bond, and option transactions so that a gain/loss value can be provided and listed. The enhancement is based on “time stamping” the transactions that will allow for a chronological capture of the buy positions and thus allow for the appropriate average cost. For mutual funds positions, this time stamp functionality is not applicable since the net asset value of the position is determined at the end of the day. Moreover this does not impact the discount instruments, short sales nor the “Closed Option Positions Initiated in Prior Years” section. Cost for multiple sells only on the same day of the same security was fixed in the 2012 tax year. These transactions have displayed costs and thus correctly reflect the appropriate gain/loss.




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Cost for Multiple Buys and Sells on Same Day Frequently Asked Questions:

What is Cost for Multiple Buys and Sells on Same Day and how does this benefit my client? Starting 2016 the cost of positions that have multiple transactions completed on the same day are captured. This will allow your client to file their taxes more accurately using the Book Value and Gain/Loss columns on the Summary of Security Disposition. Previously the system could not distinguish between multiple purchases and sales occurring on the same day as information was gathered at the end of the trading day. Consequently, book value for these positions would have a blank cost and be funnelled into the blank value section of the summary. We will now be able to “time stamp” transactions and capture information in a chronological order that will average out the book value and list the value and capture in the appropriate section on the summary. Please keep in mind there may be unique situations may not be able to capture correctly. v) MUTUAL FUND “AUTOMATIC WITHDRAWAL PLANS” (AWDs) Clients who participate in AWD programs receive periodic withdrawals of funds directly from the mutual fund company in question. These funds do not flow through a client’s RBC account, so the dollar value of each withdrawal is not reflected in a client’s monthly account statements. As was done in previous years, we are providing the dollar value of these AWD dispositions on the Summary in order to provide a more complete package of disposition information. Book value information will be provided for these dispositions as well. A special note should be made for clients that have an “automatic

withdrawal plan” from a non-registered account. The proceeds of disposition are in fact the amount that was actually withdrawn for each disposition transaction. Let’s look at an example: Ms. X withdraws $5,000 monthly from her non-registered account. The Summary would show the following amount for the month of January:

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Quantity Amount Book Value Gains/Losses

466.23 (1) $5,000.00 $4,920.56 (2) $79.44

1) The proceeds will be the amount withdrawn for that specific month; here, it is $5,000. 2) The gain or loss will be the Amount less the Book Value. In summary, each month is a separate transaction and must be recorded as such on the Schedule 3 form. vi) Market Value Transfers The Summary of Security Dispositions (SSD) captures internal transfers of assets completed at Market Value from one account to another where there is a beneficial change in ownership. These transactions, considered dispositions, are taxable events that will be listed as ‘TRANSFER’ as the TYPE/PRICE and will show all related tax information of that transfer: date, unit amount, description, amount transferred, book value (if available), and associated gain/loss. The book value that will be listed for these transactions will be the cost registered on ZCBC. These taxable transactions will be subject to all rules that govern our tax reporting for the Summary of Security Dispositions such as blank book cost placement and native cost under the same day settlement foreign exchange regimen. All of the asset classes (i.e. Equity, options, etc.) that are found in the “Equity, Bonds & Other” section only will be subject to this market value capture enhancement under the criteria stated above. As any transaction in this section, the values that result from this event will be included in the summation for each total for the Equity, Bonds & Other. Please see graphic below:

There will be some limitations in the picking up of these events. The following transfers will not be picked up on the Summary of Security Dispositions:

a) Mentioned above, only internal market value transfers will be captured on the Summary of Security Dispositions but only such transfers that are completed on the TFOT system of which the significant majority are executed. Transfers on JEFE system will not be captured and reported on the SSD due to lack of standardization of the processing that make it difficult for this enhancement to catch.

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b) External market value transfers will not be listed on the SSD. These transactions, are, by its nature difficult to capture as information such as book value are required from the receiving or delivering institution that may not necessarily be available when required .

c) We will not be listing book value transfers as they are not considered taxable events at the time of this transaction. This variety, of course, will be captured on the Summary of Security Dispositions on eventual disposition of the security.

As any other removal of assets from an account (i.e. disposition, redemption) these transactions will be reported to the CRA, listing the date of transfer, (disposition), the unit amount transferred, market price transferred at, and a description of the position on a calendar year end basis. We will not report to the CRA, as in any other disposition, the book value and the associated gain/loss. As there are a multitude of tax implications the client may face with the reporting of this information to the CRA, please refer to Financial Advisory Support for any questions of strategic note. For more details on the taxable impact of In-Kind Asset Transfers please refer to the following Wealth Management Services article, http://advisornet.fg.rbc.com/wealthmanagementservices/file-311230.pdf

Market Value Transfer Frequently Asked Questions:

What is Market Value Transfer and how does this benefit my client? Starting 2014 the transfers of assets from one account to another where there is a beneficial change in ownership and the transaction was enacted on the TFOT system are caputured. As taxable events, these transactions are required to be reported to the CRA. This will allow your client to accurately file their taxes using the Summary of Security Disposition. Please keep in mind there may be unique situations or choices after the reporting fact that may make the transactions a non-taxable event. We will leave the decision to file such transactions to the client or their tax preparer.

What Book Value will be used when listing Market Value Transfer Transaction? What impact will this change have on my client? The book value that will be used will be the adjusted cost base as in any transaction picked up by the Summary of Security Dispositions. Please note the book value that will be used is the adjusted cost base of the position and not necessarily the cost applicable in certain tax situations such as a rollover or a deemed disposition prior to death as just a few examples.

My client has exercised a tax election that deems this transfer as a non-taxable event. Why was this reported on the Summary of Security Dispositions? Since tax elections are the choice of the client to enact, our tax reporting of this event assumes that the client will not choose this option irrespective of whether this is the logical tax route to assume. In light of this, tax operations are obligated to list these transactions as tax events that must be reported to the CRA. We will leave the options available to the client on filing this event with their tax preparer or accountant. vii) Improvement in Reporting Non-Taxable Mutual Fund Switches Normally, switches within mutual fund families are deemed non-taxable events that are not required to be captured on the Summary of Security Dispositions and subsequently not reported to the Canada Revenue Agency. There were certain factors, internal and external, that prevented accurate reporting of these events on the Summary of Security Dispositions.


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An enhancement to the tax process has been put in place that triggers review of the table (ZMFR) that controls the taxability of switches as switch transactions get completed. This review process entails the comparison of taxable information provided by the fund company that will allow for a constant update of the table and consequently an update for the file that produces the Summary of Security Dispositions. In spite of a significant majority of our tax deferred switches reported correctly by not appearing on the Summary of Security Disposition, this will reduce the small population that should not have initially appeared on the report. Although this has been implemented since the 2015 tax season, it does not resolve some issues in relation to the way a switch is completed. For example, a transaction switching one fund into multiple funds and vice versa will continue to be captured on the SSD, incorrectly ( i.e. Russell corporate class switches will continue to be incorrectly labeled and thus listed on the Summary of Security Dispositions).

Mutual Fund Switches Frequently Asked Questions:

My client executed a switch from a Money Market Fund to several different eligible funds that were deemed a non-taxable corporate class fund event. Why was this reported on the Summary of Security Dispositions? Mutual Fund Switches from one fund to several funds or several to one fund will continue to be picked up due to the

difficulty the tax system has in distinguishing the subsequent transaction after the initial switch.

II Internal Tools That Can Be Used to Support the Summary of Security Dispositions

(A) Summary of Security Dispositions and ClientLink Realized Gain/Loss Reports Currently, Realized Gain/Loss reports are available on ClientLink ‘Internal Reports’ and also as an optional section IA teams can choose in their FlexPak reports. These reports can provide a view of the dispositions that have occurred in the clients account prior to the production of the Summary of Security Dispositions. In the majority of cases the realized gains/losses from these reports will match the Summary of Security Dispositions as both were generated from the same source. The Summary of Security Dispositions however, is the official book of record for client dispositions for the 2017 reporting year. The dispositions provided in the ClientLink reports are only provided to assist in tax planning. Should a discrepancy exist in a disposition amount on the ClientLink report and the Summary of Security Dispositions, the latter will be taken as correct. Please see the following link for differences between FlexPak reports and Summary of Security Disposition, http://advisornet.fg.rbc.com/flexpak/file-815723.pdf

ClientLink Realized Gain/Loss Reports Frequently Asked Questions:

Does the data on the ClientLink Realized Gain/Loss Report match the Summary of Security Dispositions? In the majority of cases, the realized gains will match, as the data (book cost and proceeds) is taken from the same source. However, the Summary of Security Dispositions included in the T5 tax package, the official book of record (ClientLink is a tax planning tool only). All efforts have been made to reconcile the two reports as much as possible, but should a discrepancy arise between the ClientLink report and the Summary of Security Dispositions (SSD), the latter is correct. More information at: http://advisornet.fg.rbc.com/flexpak/file-815723.pdf

http://advisornet.fg.rbc.com/flexpak/file-815723.pdf

http://advisornet.fg.rbc.com/flexpak/file-815723.pdf

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(B)Summary of Security Dispositions and Statements under Client Relationship Model Phase 2 (CRM2) Under CRM2, we are required to provide a book cost for all positions on the monthly statements provided to clients. In light of this, positions that were formally error flagged and consequently suppressed are now set with a default market value (value as per process date) and unsuppressed on the statement as per new CRM2 regulations. The error flag will continue to be attached to the position until the book cost is updated in the account. As the flagged cost is inaccurate as a market value, the error flag will continue to suppress the book value on the Summary of Security Dispositions. Even though the cost value is listed as a market, this is not considered a valid cost for tax reporting purposes and thus suppressed. These transactions will be listed in the Summary of Security Dispositions under the section “REPORTABLE TRANSACTIONS MISSING BOOK VALUES AND REQUIRE YOUR CALCULATION/INCLUSION”.

T3 TAX REPORTING:

Please refer to the tax form grid for a complete description of the T3/T5013 tax package and its components. I T3 Tax Reporting and Functionality

As part of our CRA obligations we are required to issue clients a T3 tax slip listing all distributions earned by the client from a trust during the tax year. This obligation is met by providing the T3 tax slip to clients in the T3 tax package that may be issued in several tranches in March and/or by specific entities depending on the security. The Statement of Trust Income Allocations/Designations is also delivered and used in support of the T3 tax slip. The following section details what and how we report these trust positions on the T3 Tax slip and the supporting Statement of Trust Income Allocations/Designations. (A) T3 Tax Slip The T3 tax slip records the total distribution income earned by the client during the tax year from all trust sources including Mutual Funds, Capital Trusts, Income Trusts, Royalty Trust, and Real Estate Investment Trust (REITs). The income earned from these products could vary widely, from a dividend, to interest, to return of capital. Whatever the designation of the income, they retain their taxable identities and any tax mechanisms that are attached to them. With respect to Income Trusts, REITs, Capital Trusts and Royalty Trusts, it is this wide variation in type of income that is not determined until after the tax year has been completed that forces RBC to deliver the T3 tax package later than the T5 tax package and in varying dates. This is because the delivery of T3 packages depends on the release of information by external issuers of income trusts to the financial institutions. In light of this, RBC mails the T3 tax package to clients during the month of March every year and files the information contained to the Canada Revenue Agency. Please keep in mind we do not generate T3 tax slips for clients that hold Mutual Funds. These slips will be delivered by the respective Mutual Fund companies. Please note RBC Mutual Funds (RBF) and will be made available on DOCUnet but any questions with respect to these tax slips will have to be referred back to RBC Global Asset Management and/or the administrators of the tax slip.

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T3 Tax Slip Frequently Asked Questions:

My client received a T3 package and the income from a distribution that was paid after December 31, 2017 was included? Why would this occur? Some Income Trust Issuers declare a record date for a distribution late in 2017 but will not pay until 2018. Although these distributions are payable in 2018, they are paid from the Trusts’ 2017 earnings and are therefore taxable to clients’ in 2017.

My client did not receive a T3 package for an Income Trust security that they hold. Please review your clients’ monthly statements to determine if the account held the security over a distribution date. In some cases the client may have sold the security before the distribution was paid or bought it after the last distribution of the year.

My client received a T3 package in early April but had already filed their personal income taxes. Why would they receive a T3 package in April? This happened because the issuer of the Income Trust that your client holds did not release their taxable distribution information in a timely manner or amended previously issued information. As a reminder, the Federal Government passed legislation effective tax season 2007 requiring income trust and publicly-held limited partnership issuers to report to financial intermediaries by February 28. Despite this, you may still receive tax packages into April due to late disclosures and amendments by some income trusts and limited partnership units. We expect the 2017 tax year to have better adherence to the February 28 disclosure deadline, given that the legislation has now been in place for several years. Please note that the government’s February deadline does not apply to privately-held limited partnerships, which still have until March 31 to file disclosures. For your clients to see a list of the securities for which they are expected to be issued a T3 or T5013, please encourage them to review their “Important Information Regarding Outstanding Tax Documents”, included in their T5 mailing. In the event that any of these scenarios occur and apply to your account holdings, you could receive tax packages into mid or late April. We recommend you caution your clients not to file their taxes until all slips have been received. Updates will be posted on Advisornet beginning in March continuing until all T3 tax packages have been mailed. In addition, taxable breakdown information and mailing dates for all Income Trusts is available on Advisornet at the following link: http://advisornet.fg.rbc.com/taxreporting/cid-180888.html

http://www.rbcds.com/TaxReporting2007/FebDef-OutstandingTaxDocuments.html


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My client received a T3 slip for a re-invested distribution on an income trust that is not reflected on their monthly client statement. Why was this not reflected? These types of distributions can be called “Phantom” or “Notional” distributions. The attached link will provide you with detailed information regarding these distributions and specifically how the client’s Adjusted Cost Base is affected, http://advisornet.fg.rbc.com/bookvaluesystem/cid-271764.html

My client earned income from a Capital Trust Security and it is being reported on the T3. In previous years this was it was reported on their T5 Tax ticket. Can we have an updated T5 and T3 reflecting this income? No amended tax slips will be issued in this case. For the majority of cases income earned from these types of securities are not reported on the T5 but rather the T3. The income payable from these securities (also known as ‘transferable trust units’) is expected to be treated as income from a trust. There may be some Capital Trusts that are still reported on the T5 in which case the income produced from the trusts’ asset is considered interest and subject to all rules thereof. Please review the following link that lists securities deemed for T3 reporting, http://advisornet.fg.rbc.com/taxreporting/cid-294455.html (B) Income Trusts – T3 Tax Slip Delivery Schedule It is anticipated that a majority of the publicly-held issuers will report to financial intermediaries by February 28th as per government legislation. Clients may still receive tax packages into April due to late disclosures and amendments by some income trusts. Anticipated mailing dates for T3 tax packages will be around early March. Please note that once an income trust issuer releases their taxable distribution information through the Canadian Depository for Securities (CDS) reporting facility it will take approximately 7 to 10 days for Tax Operations to collect, review, and mail the T3 packages to our clients. For example, to meet the March 06 mailing date, an issuer must have provided their T3 information to CDS by February 24. In some cases however, a security may be removed at any time from any mailing run if the issuer has amended previous information. We recommend that clients do not file their income taxes until they have received all outstanding T3 tax slips. Updates will be posted on Advisornet beginning in March continuing until all T3 tax packages have been mailed. In addition, taxable breakdown information and mailing dates for all Income Trusts is available on Advisornet at the following link: http://advisornet.fg.rbc.com/taxreporting/cid-180888.html

INCOME TRUST SCENARIOS THAT YOU MAY ENCOUNTER:

1. Client receives a T3 tax package and a distribution paid after December 31, 2017 is included – Some Income Trust issuers declare a record date for a distribution late in 2017 but will not pay that distribution until 2018. Although these distributions are payable in 2018, they are paid from the Trusts’ 2017 earnings and are therefore taxable to clients’ in 2017.

2. Client didn’t receive a T3 package for an Income Trust Unit they hold – Check the client’s monthly statements to determine if the security was held over a distribution date. In some cases the client may have sold the security before the distribution was paid.

I.e. Client A buys 100 units of Eagle energy trust on March 03/17. Client A subsequently sells all 100 units before the ex-dividend date of April 03/17. Client A would not be entitled to the distribution and no taxable event would be captured for T3. 3. Client received a T3 package in early-mid April – The issuer of the income trust did not release

their taxable breakdown information in a timely manner or amended previous information. (See (A) Income Trusts section)

4. Client received a T3 package for a re-invested distribution on an income trust that is not reflected on their monthly client statement – These types of distributions can be called “Phantom”





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or “Notional” distributions. They can be both confusing and frustrating for your client. The attached link will provide you with detailed information regarding these distributions and specifically how the client’s Adjusted Cost Base (ACB) are affected.


(C) Releve 16 Tax Slip The Releve 16 tax slip is the Revenue Quebec version of the T3 that records the total distribution income earned by the Quebec resident client during the tax year from all trust sources including Mutual Funds, Capital Trusts, Income Trusts, Royalty Trust, and Real Estate Investment Trust (REITs). This slip is a mirror of the T3 tax slip with the differences lying in the credits amounts provided for eligible and ineligible dividends. For the 2017 tax year the credit amount 11.9% for Quebec Residents. The slip is provided in the T3 tax package attached to the T3.

(D) Statement of Trust Income and Allocations/Designations The Statement of Trust Income and Allocations/Designation is used in support of the T3 Tax Receipt and applicable Releve 16 and lists all the distributions, in total and monthly, that was received during the tax year from all trust sources including Capital Trusts, Income Trusts, Royalty Trust, and Real Estate Investment Trust (REITs). Moreover, the distributions are further broken out into the types of income received such as return of capital, dividends, and other income. As the income distributed retains its tax identity this break down will make it easier for the client to reconcile the information on their tax slip and file to the CRA accordingly.


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(E) Return of Capital Processing (ROC) – T3 reporting Return of Capital distributions reduces the adjusted cost base (ACB) of your investments. For clients holding the position these entries are posted to client’s accounts in April of each year as ROC processing is based on the release of distribution information by the issuer in February through March. Further information will be posted by the Book Cost Department in April (F) Non-Resident Tax Processing – T3 Reporting Non-resident clients that held Canadian Income Trust Units during 2017 may have received distributions that are subject to non-resident tax. Due to the nature of these securities the taxable breakdown information is not available until after the calendar year 2017 is complete. Therefore, these accounts are not charged non-resident tax when distributions are made during the year but rather a one time charge for the full year is generated once the taxable nature of the trust’s distributions is determined. This one time charge will occur in late April 2018. A separate communication will be released in early April 2018 confirming the exact processing date. (G) Mutual Funds Tax Operations does not deliver T3 reporting for any Mutual funds as this is handled by the Mutual Fund Company itself. Consequently we do not provide duplicates tax slips nor can provide for any questions on these tax slips that the mutual fund company provides. For amendment requests, please refer to the Mutual Fund amendment request procedures on page 95. RBC Direct Investing representatives can access fund company information from the mutual fund database directly. You may also visit the following link for a list of fund companies and their contact information. http://advisornet.fg.rbc.com/positions/cid-272943.html T3 slips for RBC Private Pools Series F and RBC Arc Fund Series A (Clients of RBC DS) will be issued by Royal Mutual Funds Inc. and will be available on DOCUnet for online viewing. Requests for mailing dates, and general inquiries should be directed to RBC Dealer Services (1-800-662-0652 Option #2). II Internal Tools That Can Be Used to Support the T3 Tax Slip

http://advisornet.fg.rbc.com/positions/cid-272943.html

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These tools will assist the client in providing accurate and complete tax reporting which will save you and your client time and grief during the stressful tax year. Please note some of the tools are delivered in the T5 tax package and any documentation from that delivery should not be discarded. (A) Income Trust Disposition Gain/Loss Worksheet Clients who have disposed of an income trust security in the 2017 calendar year will receive an Income Trust Disposition Gain/Loss Worksheet in their T5 tax package. This worksheet is to be used in conjunction with their T3 package(s) that they will receive shortly after the T5 package. Instructions are provided on the double-sided worksheet and the link has been included here for your reference. http://advisornet.fg.rbc.com/taxreporting/cid-180893.html. Please review the graphic below for a sample of what is delivered in the tax package.

(B) Notification of Forthcoming Tax Forms In order to inform clients that there may be follow-up tax slip mailings, the T5 package will include the following report (example shown). This document will prevent the client from filing to the CRA pre-maturely under the possibility of further slips to be delivered. Please note that this document will list all T3 reporting positions held during the tax year, irrespective of whether a tax slip is delivered or not. For example, mutual fund companies provide their own T3 forms directly to clients, as such; Tax Operations cannot guarantee that one will be delivered. Nonetheless these positions will be listed on this document under the possibility of tax slip delivery. This purpose of this notification will be to remind clients to review their statements to confirm income and thus not to file their tax returns before receiving all tax documentation.

Important Information Regarding Outstanding Tax Documents:

Please note that in addition to this T5 tax package, additional tax forms may still be forthcoming if you held any of the following types of securities during 2017: Split Corps, Income Trusts, Limited Partnerships, Closed-End Mutual Funds, or Mutual Funds. You MAY receive additional tax information if any of the securities listed below paid a taxable distribution during the 2017 reporting year. Our records indicate that you MAY soon receive additional tax forms for the following securities:

Eagle Energy Trust Units

We recommend that you do not file your income taxes until you have received all outstanding tax slips. Note: Tax slips for mutual funds are issued by the fund company directly. Important Note Regarding T3 Reporting for Income Trusts:

The delivery of T3 packages depends on the release of information by external issuers of income trusts to financial institutions. As a reminder, the Federal Government passed legislation effective 2007 requiring income trust and publicly-held limited partnership issuers to report by February 28. Despite this, you may still receive tax packages throughout March and April due to late disclosures and amendments by some income trusts and limited partnership units. We expect the 2017 tax year to have better adherence to the February 28 disclosure deadline, given that the legislation will have been in place for several years.

(C) Client Guide to Tax Reporting Written in concert with Financial Advisory Support, the Client Guide to Tax Reporting is a handy booklet that breaks down each tax slip in laymen terms and provides answers to common tax scenarios that many of our clients face. The guide also features handy reference’s that client’s may require for tax reporting


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such as average foreign exchange for many currencies as listed by the Bank of Canada. This booklet is delivered with the T5 tax package.

(D) 2017 Income Trust Distribution Rates For clients that have questions about the distribution rates applied on their T3 tax package for any security, we provide the link to Canadian Depository for Securities (CDS) website for all rates that have been reported by the issuers of T3 applicable securities on our tax website, http://advisornet.fg.rbc.com/taxreporting/cid-180888.html. In addition to the breakdown of the rates, the CDS site provides a row that lists whether a notional (phantom) distribution value (see T3 Reporting section B for more details) was applied to the rate (see graphic below). Moreover, we provide the mailing dates for all T3 securities sent. Please note we do not report for Mutual Funds (See Section G under T3).


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NR4 TAX REPORTING

Please refer to the tax package grid for a quick description of the NR4 tax package. The T5 and T3 tax slips does not apply for our non-resident clients but the T5 and T3 tax package will still be delivered for our non-resident clients that have earned Canadian source income. CRA requires that a portion of dividend or distribution income received be withheld for taxation purposes and this information is captured on a NR4 tax slip. The following section details what we provide for our non-resident delivery.

I NR4 Tax Reporting and Functionality

(A) NR4 Tax Slip The NR4 tax slip can list a slew of income earned by the non-resident client but the main ones normally recorded are dividends (Income Code 09), capital gains from REITS (58), trust income (11) and interest income (61) earned by the client during the tax year. Tax operations will provide a NR4 for any client that is or has become a non-resident during the tax year as dictated by the GEO code listed in the account. The NR4 will capture all Canadian sourced income received only while a non-resident and list the total of each identified income type. Moreover, the NR4 will also list the withholding tax that was applied to each type of income as applicable. Withholding tax applies on all Canadian sourced income of Canadian based securities that is allowed to be held by the client regardless of the tax stream. This means that NR4s can be mailed during the T5 tax delivery as well as T3 tax delivery season. The rate and whether withholding tax is applied depends upon three factors: the source of income, the residency of the client and the type of income received. CRA only applies non-resident tax, intuitively, on Canadian sourced income. This means that Canadian produced income paid from Canadian based corporations are subject to withholding. Secondly, withholding rate depends on the residency of the client. The rate coincides with the tax treaty that was agreed upon by Canada and the country of residency of the client. The rates can be found on the following link:

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http://advisornet.fg.rbc.com/wealthmanagementservices/file-816438.pdf Thirdly, withholding tax is only applied on specific types of income such as dividends, other income, and on capital of real estate investment trusts. Please review the graphic for further details.

NR4 Tax Slip Frequently Asked Questions:

My client is a non-resident but received a T5, can the client submit a T5 to the CRA or do they require an NR4? If your client is not a resident of Canada, a T5 slip cannot be submitted to the CRA. In these cases, an NR4 slip will have to be issued. Please follow the amendment request process under the Tax Reporting website on Advisornet to request NR4 tax forms. If your client’s residency changed mid-year, a T5 slip will be issued for the portion of the year that the client is a resident of Canada and an NR4 slip will be issued for the portion of the year that the client was a non-resident. Please review the client’s residency status prior to submitting an amendment request.

My client received a NR4 with non-resident tax withheld but he is a Canadian resident. Can I have the client’s NR4 cancelled and have a T5 issued instead? No T5 tax slip will be issued in this case. The Canadian Revenue Agency (CRA) does not accept amendments or deletions to NR4’s once they have been issued. Residents of Canada who received a NR4 slip with non-resident tax withheld can get a credit for the amount withheld by including the slip with their Canadian income tax returns. (B) Statement of Trust Income and Allocations/Designations and/or Summary of Investment Income and Expenses Non-resident clients can be holders of all types of Canadian sourced income securities including income trusts and corporate structured securities. In light of that, NR4 tax slips can be delivered during the T5 or T3 tranche of deliveries and thus a client will receive a Statement of Trust Income and Allocations/Designations and/or Summary of Investment Income and Expenses that supports the NR4 tax slip that was delivered. Both the statement and the summary have the same properties and functionality as the documents in the T5 and T3 counterpart. Please see graphic below.


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(C) Non-Resident Tax Processing – T3/NR4 Reporting Non-resident clients that held Canadian Income Trust Units during 2017 may have received distributions that are subject to non-resident tax. Due to the nature of these securities the taxable breakdown

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information is not available until after the calendar year 2017 is complete. Therefore, these accounts are not charged non-resident tax when distributions are made during the year but rather a onetime charge for the full year is generated once the taxable nature of the trust’s distributions is determined. This one time charge will occur in late April 2018. A separate communication will be released in early April 2018 confirming the exact processing date. (D) Non-Resident Tax Treatment of Joint Accounts Since 2014 tax year, Joint Accounts with a non-resident as a member of the account will be subject to CRA Non-Resident Taxation irrespective of whether the non-resident member is an Applicant or Co-applicant. This delineation is important for Canadians in the account who are listed as applicants, as the account as a whole is subject to non-resident tax based on the treaty rules and associated rates for the non-resident member. Prior to 2014 the income earned in the account would have been subject to T5 tax reporting but is now subject to NR4 tax reporting. The non-resident tax that is applied to the account is based on the highest treaty rate applicable when comparing each non-resident member.

Non-Resident Tax Treatment of Joint Accounts Frequently Asked Questions: My client is a Canadian resident sharing a joint account with a non-resident but received an NR4 that indicated non-resident tax withheld. The income was fully attributed to the Canadian applicant. How can I apply for a refund of the withheld funds applicable to the Canadian? RBC Dominion Securities Inc. cannot reverse withholding as it is remitted to CRA on a regular basis. Clients in this situation will need to apply for a refund using the following NR7-R form, Please consult your tax advisor for further questions.

T5013 TAX REPORTING

Please refer to the tax package grid for a quick description of the components of the T5013 tax package. As part of our CRA obligations we are required to issue clients a T5013 tax slip listing all distributions and flow through benefits earned by the client from a Limited Partnership Unit or Flow Through during the tax year. This obligation is met by providing the T5013 tax slip to clients in the T5013 tax package that may be issued in several tranches in March and April. The following section details what and how we report these positions on the T5013 Tax slip.

I T5013 Tax Reporting and Functionality

(A) Limited Partnership Units, Flow-Through Shares – T5013 reporting Since 2013 tax year the Canada Revenue Agency has mandated that the T5013 be revamped to accommodate reporting of either a Limited Partnership Units or Flow-Throughs, with the flexibility to include both the T5013 and the T5013A reporting requirements into one tax slip. Both Flow-though shares and Limited Partnership Units (LPU) are reported on this one slip. The amalgamated T5013 reports statements of partnership income, tax shelter and renounced resource expenses earned or benefited from by the client during the tax year if the client holds the position in the account through the tax year. Tax operations will provide an individual T5013 tax slip for each partnership that the client holds in their account, as applicable. In addition to the T5013, Quebec residents must file the provincial form Releve 15. This slip will be provided in the T5013 tax package and is delivered on a per security basis, similar to the T5013. Information provided is the same as noted for the T5013.

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T5013 Tax Slip Frequently Asked Questions:

What is a T5013? How do I know if my client’s T5013 has been sent? A T5013 is a Statement of Partnership Income as well as for partnership tax shelters and renounced resource expenses. This slip reports income and losses on Limited Partnership Units (LPU’s) and Flow-Through shares of a principal –business corporation. T5013’s are produced and mailed in multiple batch runs commencing in early March until completion. Included in your client’s T5 package will be a list of LPUs and other securities for which T5013 packages are forthcoming. Clients are advised not to file their tax return until all tax packages are received. In addition, as securities for tax package mailings are released a list will be posted to Advisornet after each batch run.

What is a T5013A? How do I know if my client’s T5013A has been sent? The T5013A was combined with the T5013 for 2013 tax yearend. Please see T5013 Section A for more details. Previously the T5013A was a Statement of Partnership Income for Tax Shelters and Renounced Resource Expenses. This slip reported income and losses on flow-through shares of principal-business corporation. My client is not sure how to report his T5013 Income on his tax return. Who can I call? The back of the T5013 tax slip provides detailed instructions for reporting T5013 income on a personal income tax return. Clients are encouraged to consult with a qualified tax advisor before filing their tax return. For clients of Dominion Securities, Financial Advisory Support can be consulted for information related to the CRA and filing procedures via email at ‘Financial Advisory Support’ or via telephone at (1-877-722-3278). In addition, clients may review CRA requirements at https://www.canada.ca/en/revenue-agency.html

https://www.canada.ca/en/revenue-agency.html

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My client is missing a T5013 slip for one of their Limited Partnership Units (LPU). What should I o? It is possible that the T5013 may be issued directly by the limited partnership. Although we issue the T5013’s for most LPU’s, there are a few where the tax reporting is provided for by the partnership itself. Tax Reporting will publish this list on our tax reporting site in February. (B) Limited Partnership Units, Flow-Through – T5013 Tax Slip Delivery Schedule

The delivery of T5013 slips depends upon the release of information by external issuers of Limited Partnership Units (LPU) and Flow-Through Shares. It is anticipated that a majority of the publicly-held issuers will report to financial intermediaries by February 28th as per government legislation. Clients may still receive tax packages into April due to late disclosures and amendments by some limited partnership units. Please note that the government’s February deadline does not apply to privately-held limited partnerships, which still have until March 31 to file disclosures.

Anticipated mailing dates for T5013 tax packages will be around early March. Please note that once an LPU issuer releases their taxable distribution information through the Canadian Depository for Securities (CDS) reporting facility it will take approximately 7 to 10 days for Tax Operations to collect, review, and mail the T5013 packages to our clients. For example, to meet the March 9 mailing date, an issuer must have provided their T5013 information to CDS by February 26. In some cases however, a security may be removed at any time from any mailing run if the issuer has amended previous information. We recommend that clients do not file their income taxes until they have received all outstanding T5013 tax slips.

Updates will be posted on Advisornet beginning in February continuing until all T5013 tax packages

have been mailed, http://advisornet.fg.rbc.com/taxreporting/cid-180889.html.

(C) T5013 and T5013A Tax Slips Since 2013 tax year the CRA updated the T5013 tax slips where the T5013 and T5013A have been combined in to one tax slip, T5013. The reporting requirements will be mostly the same as last year, continuing to report statements of partnership income, tax shelter and renounced resource expenses. The type of T5013 tax slip your client receives will depend upon the type of limited partnership they hold. Please refer to the CRA website for specific details, https://www.canada.ca/en/services/taxes.html This change meant that the previously used T5013A tax slip was deemed obsolete and reporting of your client’s flow-through shares will be only on the updated T5013 tax slip. With respect to what is reported on the slip, it still report statements of partnership income, tax shelter and renounced resource expenses earned or benefited from by the client during the tax year as long as the clients holds the position in the account through the tax year.


https://www.canada.ca/en/services/taxes.html

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The updated T5013 tax slip will have significantly more floating boxes and less fixed boxes (see graphic above) of which each floating reporting box will be numbered accordingly but without the description of what the reporting value represents similar to last year. As with all of our tax slips, a guide (T5013-INST) is included that will act as a legend for each value reported

T5013/A Tax Slip Frequently Asked Questions:

My client expected to receive a T5013A tax slip for 2017 tax year but did not receive one. What should I do? Since the 2013 reporting year the Canada Revenue Agency (CRA) has used a new T5013 tax slip. This tax slip reports both Limited Partnership Units and Flow-Through Shares. Previously, limited partnership and flow–through tax shelters were reported to your client on two separate slips, a T5013 and T5013A respectively. If your client has holdings in both tax sheltered and income distributing limited partnerships they will receive only the T5013 for each position they hold. (D) Releve 15 Tax Slip The Releve 15 tax slip is the Revenue Quebec version of the T5013 that is a statement of partnership income, tax shelter and renounced resource expenses earned or benefited from by Quebec resident clients during the tax year from a Limited Partnership Unit or flow-through security the client holds in the account through the tax year. The slip is provided in the T5013 tax package.

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(E) Gaz Metro – T5013 Reporting With the exchange and wind-up of Gaz Metro Limited Partnership Units in 2012, T5013 slips for Gaz Metro will no longer be mailed to clients. For further information on Gaz Metro, including a list of Frequently Asked Questions, please visit the following site. http://www.corporatif.gazmetro.com/Corporatif/DistributionBenefice/en/HTML/50_en.aspx

(F) DOCUnet Viewing – T5013 Reporting If you hold multiple LPU’s or flow-through units, when viewing T5013 tax slips on DOCUnet, please ensure you scroll down the entire page. In some cases there are multiple T5013 slips under one DOCUnet heading. It is possible for the slip in question to be located at the very bottom. .

T5013/A Tax Slip Frequently Asked Questions:

I can access my client’s T5013 tax slips on DOCUnet, however, I can’t find a specific T5013 slip for a specific Limited Partnership Unit? When viewing T5013 tax slips on DOCUnet, please ensure you scroll down the entire page. In some cases there are multiple T5013 slips under one DOCUnet heading. Therefore, if you don’t see the T5013/T5013A slip for a specific security, scroll completely down the page.

http://www.corporatif.gazmetro.com/Corporatif/DistributionBenefice/en/HTML/50_en.aspx

http://www.corporatif.gazmetro.com/Corporatif/DistributionBenefice/en/HTML/50_en.aspx

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QUALIFIED INTERMEDIARY/US REPORTING: 1099-DIV, 1099-INT, 1099-OID, 1099-MISC,

1099-B, 1042-S GENERAL INFORMATION

PLEASE REFER TO THE TAX FORM GRID ON FOR A COMPLETE DESCRIPTION OF THE 1099 TAX PACKAGE AND ITS COMPONENTS.

Prior to 2016 tax year, US Tax reporting or Qualified Intermediary (QI) was required to report income and capital gains/losses to the Internal Revenue Service for all U.S. and suspected U.S. persons (U.S. non-exempt recipients). The designation of U.S. or suspected U.S. person is determined by the information, via documentation, provided by the account on a beneficiary level basis. Starting in 2016 tax year, U.S. person and suspected U.S. person clients will still receive a 1099 package, but the package may be classified as “Unofficial” as many U.S. non-exempt recipients will now be reported to the Canada Revenue Agency for the purposes of the Foreign Account Tax Compliance Act (FATCA). For these accounts, the 1099 tax package will be classified as “Unofficial” and the information in the 1099 package will not be filed by US Tax Reporting with the IRS. The 1099 tax package is provided solely to assist clients with their US tax filing obligations. Situations where U.S. non-exempt recipients may receive an “Official” package that will be filed by US Tax Reporting with the IRS include accounts that are not reported under FATCA (TFSA’s, RESP’s) or accounts subject to backup withholding. For more information on 1099 “Unofficial” and “Official” packages, see “What type of tax form(s) does my client get for US tax withholding?” The IRS deadline for mailing the “Official” 1099 tax packages to recipients is January 31, 2018 (deadline of February 15, 2018 for Form 1099-B). Tax Operations, as per process, will seek an extension to this mailing date from the Internal Revenue Service (IRS). The “Unofficial” packages will be mailed at the same time as the “Official” packages. Updates will be posted to AdvisorNet during January. U.S. persons residing in the United States will be reported on any worldwide income in their 1099 tax package and may be issued a 1099-B. U.S. persons residing outside the United States will be reported only on their US source income in their 1099 tax package and will not be issued a 1099-B. 1099 packages for TFSA or RESP accounts will only report US source income. All U.S. Tax Forms sent to clients are in addition to the regular Canadian-based tax reporting Forms/Summaries that they may receive. All figures shown on the 1099 packages are in U.S. dollars. For information on why a client received a 1099 package, please contact the Documentation Department for the client’s account status.

QI Tax Package Delivery Frequently Asked Questions:

The client has just realized that they were not refunded tax withheld when they became documented last year. What can I do to refund this amount to the client? The cut-off date for 2017 QI tax refund is January 2nd, 2018. If the request is made after this date, it is unfortunately too late to recoup the tax withheld. Please review the link for our QI refund policy,

What type of tax form(s) does my client get for US tax withholding? A client, who is a US citizen or US resident for tax purposes and who is being reported under FATCA or

who has no backup withholding, will receive an “Unofficial” 1099 tax package. The forms may include

http://advisornet.fg.rbc.com/advoperationsnet/file-585515.doc

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QI Summary of 1099 Investment Income, 1099 Income Totals, 1099-B Summary of Proceeds from Broker and Barter Exchange Transactions, and a Canadian Tax Package (T5/NR4). The form 1099 Income Totals and the 1099-B will have a watermark denoting the form is Unofficial and a disclaimer stating “the form is not filed with IRS and has only been provided for informational purposes”. (If client was withheld on US Limited Partnership income, the “Unofficial” package will include an official 1099-MISC that will be reported to the IRS)

A client, who is a US citizen or US resident for tax purposes and who is not being reported under FATCA or who has backup withholding, will receive an “Official” 1099 tax package and may receive one or more of the following forms: QI Summary of 1099 Investment Income, 1099-INT, 1099-DIV, 1099-MISC, 1099-B Summary of Proceeds from Broker and Barter Exchange Transactions, and a Canadian Tax Package (T5/NR4). These forms are required for US tax reporting.

A client who is a Non-US citizen and a Non-US resident for tax purposes who has been charged treaty rate withholding tax will only receive a T5 and that amount could be reported in foreign tax paid.

A client who is a Non-US citizen and a Non-US resident for tax purposes and is a beneficiary of a trust, partnership, estate, etc. may receive an IRS form 1042-S. If the client does not file a return to the IRS, this form is for information purposes only. If they do file a return to the IRS, this form is required for total income and tax paid.

GENERAL INFORMATION: WHAT’S IN THE QI TAX PACKAGE

(A) QI Summary of 1099 Investment Income This contains the details of the 1099 investment income. It may be part of the “Official” or “Unofficial” 1099 tax package. The amounts are reported on a transaction level and are sorted by date. This form is very similar to the Summary of Investment Income and Expenses that is included for clients who receive a Canadian T5 tax package. See below for sample. Please note that for distributions on Canadian Income Trust Units and Split Corps, the 1099 investment income summary may be populated with the letters “UNKN” in the “Entry Type” column. At the time that the tax package was generated, the taxable nature of these distributions had not been provided by the issuer. As a result, clients may receive an amended 1099 tax package reflecting the actual amount and entry types of taxable income after we receive the taxable breakdown information from external issuers in March.

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(B) 1099 Income Totals This is for the "Unofficial" tax package and reports totals that in previous years would have been on the 1099-DIV and 1099-INT slips such as dividends, interest, capital gain distributions, return of capital, and non-taxable distributions that were paid on stock and liquidation distributions. It also reports US Royalties income which in previous years would have been on the 1099-MISC. It will have a watermark denoting the form is Unofficial and a disclaimer stating “this form is not filed with IRS and has only been provided for informational purposes”. See below for sample.

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(C) 1099-DIV “Dividends and Distributions” This is provided in the “Official” 1099 tax package. The 1099-DIV form reports amounts such as dividends, capital gain distributions, return of capital, or non-taxable distributions that were paid on stock and liquidation distributions. See below for sample.

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Box 1a – “Total Ordinary Dividends” will capture Dividend totals. Box 1b – “Qualified Dividends” will capture dividends eligible for special U.S. income tax rates. The amounts included here have also been included in Box 1a. Where the U.S. person has additional information that any portion of these dividends does not qualify, they should not claim these special rates on their U.S. tax return. Box 2a – “Total Capital Gain Distributions” will capture capital gain distributions from a regulated investment company or real estate investment trust. Box 3 – “Non-dividend Distributions” will capture part of the distribution that is non-taxable because it is a return of your cost (or other basis). Box 4 – “Federal Income Tax Withheld” will capture any U.S.-based withholdings during the year. Box 10 - “Exempt Interest Dividends” will capture tax-exempt interest from a mutual fund or other regulated investment company paid during the calendar year. (D) 1099-INT “Interest Income” This is provided in the “Official” 1099 tax package. The 1099-INT form reports interest income earned. Where both interest and original issue discount (OID) are reported, we may report both the interest and OID on Form 1099-OID. However, we can also report the interest on the 1099-INT and the OID on the 1099-OID. See below for sample.

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Box 1 – “Interest Income” will capture interest paid during the calendar year that could be taxable. This does not include interest shown in box 3. Box 3 – “Interest on U.S. Savings Bonds and Treas. obligations” will capture interest on U.S. Savings Bonds, Treasury bills, Treasury bonds, and Treasury notes. Box 4 – “Federal Income Tax Withheld” will capture any U.S.-based withholdings during the year. Box 8 – “Tax exempt interest” will capture tax-exempt interest paid during the calendar year. (E) 1099-OID “Original Issue Discount” The 1099-OID reports original issue discount. A debt instrument generally has OID when it is issued for a price less than the stated redemption price at maturity. All debt instruments that pay no interest before maturity are presumed to be issued at a discount. If a person holds more than one discount obligation, a separate 1099-OID will be issued for each obligation. Please note that OID on obligations with a term of 1 year or less is reported on the Form 1099-INT. (All interest on debt obligations issued for less than 1 year will be considered OID.) (F) 1099-MISC “Miscellaneous Income” This may be provided in the “Official” or “Unoffical” 1099 tax package. The 1099-MISC reports other income not reported by other forms. Typically, this form reports US Limited Partnership (LPU) distributions treated as US effectively connected income and US Royalty income earned. If the 1099 package is “Unofficial”, the Royalty income will be on form 1099 Income Totals. And the US Limited Partnership income and any withholding will be on the 1099-MISC. 1099-MISC also reports substitute payments on securities lending transactions. Box 2 – “Royalties” will capture US Royalties income. Box 3 – “Other Income” will capture US Limited Partnership (LPU) distributions treated as US effectively connected income. Box 4 – “Federal Income Tax Withheld” will capture any U.S.-based withholdings during the year. Box 8 – “Substitute Payments in lieu of Dividends or Interest” will capture any U.S. source substitute payments on securities lending transactions.

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(G) 1099-B Summary “Proceeds From Broker and Barter Exchange Transactions” The 1099-B Summary reports sales or redemptions of securities, futures transactions, commodities, and barter exchange transactions for certain U.S. persons. The 1099-B will be issued only to US residents. It may be part of the “Official” or “Unofficial 1099 tax package. If it is part of the “Unofficial” package, it will have a watermark denoting the form is Unofficial and a disclaimer saying “this form is not filed with IRS and has only been provided for informational purposes”. Unlike Canadian tax disposition information, these forms reflect sales on a trade-date basis (Canadian forms reflect a settlement date basis). Gross proceeds are reported on Box 1d while Federal Income Tax Withheld (where necessary) is reported on Box 4. Beginning in 2011, cost basis and related information is reported for certain sales of securities on Boxes 1b, 1e, 2, 3 and 5. See below for sample.

i) Cost Basis Reporting Since 2011, the IRS began requiring that financial institutions that are qualified intermediaries report the cost basis of positions acquired by the affected client under the “first in, first out” method (FIFO) when selecting lots for assigning the cost basis. This method applied to all equity positions in 2011, to DRIPs and US Mutual Funds in 2013, and various other types of securities (i.e. certain bonds, options) in 2014, and certain more complex debt instruments in 2016 If the 1099-B is part of an “Unofficial” 1099 package, the 1099-B (including cost basis information) will

not be reported to the IRS. Please review the following job aid should you require more detail, Cost Basis Reporting on US Tax Packages. Capturing Cost Basis for Equity On a 1099-B under FIFO rules: Client purchased 100 shares of MSFT @ U$26.00 on 01/31/15. Client further purchased 200 shares of MSFT @ U$28.00 on 03/01/15 in the account. Subsequently client sold 150 shares on 03/15/15 @ U$29.50.

http://advisornet.fg.rbc.com/taxreporting/file-628248.doc

http://advisornet.fg.rbc.com/taxreporting/file-628248.doc

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Cost Base listed on 1099-B = U$4000.00 Calculation: (100 shares purchased on 01/31/15 x U$26.00) + (50 shares purchased on 03/15/15 x U$28.00)

Cost Basis Reporting Frequently Asked Questions:

How has the reporting on Form 1099-B changed since 2011? The Form 1099-B for tax year 2011 and going forward, reports the following:

Sale proceeds (this was reported before 2011) Cost basis of covered securities Whether the shares disposed of are covered or non-covered Whether the gain or loss on the sale of covered securities is long-term or short-term Beginning in 2016 Tax Year, the 1099-B in the “Unofficial” 1099 package will have an Unofficial

watermark and a disclaimer saying “this form is not filed with IRS and has been provided for informational purposes only”

What is the difference between Covered and Non-covered Securities? Covered securities are those acquired on or after the applicable dates outlined by the legislation. Non-covered securities are those acquired by clients before the applicable dates. Brokers are not required to report cost basis on non-covered securities. Please keep in mind our systems do not have the capability to provide non-covered securities cost basis amounts. Taxpayers are responsible for accurate reporting of cost basis on both covered and non-covered securities to the IRS on their tax returns.

H) 1042-S Tax Forms 1042-S tax forms are issued for U.S. source income to accounts that are coded in BTS as one of the following client types:

Non-Qualified Intermediaries

Qualified Intermediaries

In Trust for account

Registered Investment Councillors

Other Direct non-U.S. account holders The tax forms are issued to the account holder or the QI or NQI as documented. For the 2017 tax reporting year we expect the mailing to occur by March 15, 2018. Please note that certain account holders will not receive a copy of the 1042-S form. However, we are still required to file pooled 1042-S forms with the IRS for the U.S. source income received by these clients. Also, where an account has beneficial owners (i.e. certain investment clubs, partnerships, etc.), each beneficial owner will be issued separate tax forms depending on their account status. Unlike the 1099, these forms are not broken down by income, i.e. 1099- DIV, 1099-INT, 1099-MISC, 1099-B or 1099-OID. The 1042-S tax form is issued based on unique income codes and tax rates. A different 1042-S tax form is issued based on each unique type of income and withholding tax rate combination. For example, if the client received dividend income and was charged 15% withholding tax, and interest income that was charged 10% withholding tax, two separate 1042-S tax forms are issued to reflect the dividend and interest income.

REGISTERED ACCOUNTS: T4RSP, T4RIF, T4A, NR4 Please refer to the tax form grid for a complete description of the T4 tax packages.

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Although income producing activity within a registered account is not taxable there are certain transactions that are that impacts your client’s tax filing. Generally, assets removed from the sheltered account must be accounted and taxed or assets moved into a registered account credited accordingly. These taxable events will be captured and listed accordingly on the tax slips described below. (A) Registered Tax Package Delivery The delivery of registered tax packages occurs on specific dates. The T4 family along with the applicable Releve slips is normally delivered in mid-February. Contribution receipt mailings are delivered throughout the tax year, dependent upon when the contribution occurred. For complete contribution receipt mailing schedule please refer to the tax form grid. (B) 2017 Contribution Deadline Please note that the deadline for making a 2017 deductible RRSP contribution is March 1st, 2018. GENERAL INFORMATION: WHAT’S IN THE REGISTERED TAX PACKAGE

(A) Types of Registered Tax Forms i) Contribution Receipt This form is used to identify and capture clients’ contributions to their RSP (Retirement Savings Plan). There are two time frames. The 1st 60 days of the year and the remainder of the year. Any contribution made during the 1st 60 days of the calendar year can be used for the preceding tax year, current tax year, or future tax year. For this tax year, the RRSP contribution deadline will be March 1st, 2018. Any contribution made during the remainder of the year can only be claimed in the year in which it was made for tax purposes or a future year. For complete contribution receipt mailing schedule please refer to Tax form grid. Duplicates of these forms are available for online viewing on DOCUnet within a week of the scheduled mailing date. As a reminder, duplicate copies of contribution receipts posted on DOCUnet can now be used as a true facsimile. The duplicate contribution receipt can be sent directly to clients should they require it. Duplicates of receipts already on DOCUnet that flash “THIS IS NOT AN OFFICIAL TAX RECEIPT” will still need to be requested from your Middle office service team.

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ii) T4RSP This form is used to identify all withdrawals from an RSP. The most common is the client requested withdrawal where withholding tax applies for all Canadian non-Quebec residents at the following rates are as follows: Up to $5000 – 10% $5000 - $15000 – 20% $15000 and above – 30% Quebec residents are subject to the following Federal and Provincial rates and will also receive a corresponding Releve 2: Up to $5000 – 21% (Federal 5%, Provincial 16%) $5000 - $15000 – 26% (Federal 10%, Provincial 16%) $15000 and above – 31% (Federal 15%, Provincial 16%) These withdrawals are reflected on the T4RSP form. The other types of withdrawals that would appear on this form are as follows: -Refund of Excess Contribution Box 20 -LLP (Life Long Learning Plan) Box 25 -Marriage Breakdown Box 35 -Homebuyers Withdrawal Box 27 A T4RSP is also issued upon the death of the annuitant. However, the boxes used will vary based on whether or not the account is paid out or rolled over. Please see graphic below.

Important! Backdates and Amendments for T4, REL and NR4 Please see section viii) for more details.

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iii) T4RIF This form is used to identify all payments received from a RIF (Retirement Income Fund), LIF (Locked in Fund), LRIF (Locked-in Retirement Income Fund) and PRIF (Prescribed Retirement Income Fund). Any payments made from a RIF must be reflected on this form. Any payments greater than the minimum payment required are subject to a withholding tax and are reflected in the Excess amount and Income tax deducted, boxes 24 and 28, respectively. The T4RIF also reflects Marriage Breakdown information in box 35. A T4RIF is also issued upon the death of the annuitant. However, the boxes used vary based on whether or not the account is paid out, rolled over or succeeded to.

Quebec residents are subject to the following Federal and Provincial rates and will also receive a corresponding Releve 2: Up to $5000 – 21% (Federal 5%, Provincial 16%) $5000 - $15000 – 26% (Federal 10%, Provincial 16%) $15000 and above – 31% (Federal 15%, Provincial 16%) Important! Backdates and Amendments for T4, REL and NR4, see section viii) for details.

T4RIF Frequently Asked Questions: My client completed a T2030 Transfer (RRIF to RRSP or LIF to LIRA) and the T4RIF and Contribution receipts do not match, these types of transfers are supposed to be tax free, why is there a difference? There are 2 most common reasons for this. If the T4RIF is greater than the contribution receipt, the difference should equal the RRIF Payment the client received. The other reason could be if the Book Value was updated on either the RRIF or the RRSP. T2030 transfers are done at Market Value; the book value should not be updated on these types of transfers.

iv) Releve 2 The Releve 2 tax slip is the Revenue Quebec version of the T4RSP or T4RIF that is a statement of all payments received from a RIF and withdrawals from an RSP from Quebec resident clients during the tax year. For Quebec residents, this form is used in conjunction with the T4RSP or T4RIF.

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v) T4A This form identifies the income or grant amounts paid to the beneficiary of an RESP (Registered Education Savings Plan) or the AIP (Accumulated Income Payment) paid to the subscriber. -Income payment to a Beneficiary is reflected in Box 42. -The AIP is reflected in Box 40 A T4A is also issued upon the death of a TFSA holder if the amount paid out is greater than the value of the account on the date of death (Box 134). Important! Backdates and Amendments for T4, REL and NR4 Please see section viii) for more details.

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vi) Releve 1 For Quebec residents, this form is used in conjunction with the T4A.

vii) NR4 This form identifies all withdrawals or payments from retirement savings plans (RSP), retirement income funds (RIF, LIF, LRIF, PRIF) or education savings plans (ESP), or tax free savings account (TFSA) for any

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annuitant or beneficiary that lives outside of Canada and the corresponding withholding tax on that transaction. The withholding tax applied will depend upon the country the non-resident client resides in and the corresponding treaty rate with that country. Different types of withdrawals or payments are reflected in Box 14 Income Code. Each code below represents a different transaction.

24 RESP BENEFICIARY PAYMENT

26 Periodic RIF payment 27 Lump Sum RIF payment 28 Periodic RSP payment 30 Refund of Excess contribution on an RSP 43 Lump Sum RSP payment

An NR4 is also issued upon the death of a TFSA holder if the amount paid out is greater than the value of the account on the date of death. viii) Important! Backdates and Amendments for T4, REL and NR4 As per previous calendar year, RBC will pass on the penalty plus interest charges from CRA. This includes Registered Products such as RSP, RIF and LIF. All penalties and interest charges will be applied directly to the Registered account. Here is a breakdown of the rates that may be used by CRA as per the following website, https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/payroll-overview/penalties-interest-other-consequences.html

If the remittance due date is a Saturday, Sunday, or Canadian public holiday, your remittance is due on the next business day.

The penalty for remitting late is:

3% if the amount is one to three days late;

https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/payroll/payroll-overview/penalties-interest-other-consequences.html



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5% if it is four or five days late;

7% if it is six or seven days late; and

10% if it is more than seven days late or if no amount is remitted.

Note We consider a non-sufficient funds (NSF) cheque to be a failure to remit and will automatically apply a penalty, as well as an

administrative charge. If you are subject to this penalty more than once in a calendar year, we may assess a 20% penalty to

the second or later failures if they were made knowingly or under circumstances of gross negligence.

For more information please see our News/Latest Announcements on the Tax Reporting website, http://advisornet.fg.rbc.com/taxreporting/cid-187377.html

TAX FREE SAVINGS ACCOUNTS (TFSA) Effective January 1, 2009 CRA introduced a new type of registered product: the Tax Free Savings Account (TFSA). The biggest difference between a TFSA and an RSP account is that TFSA funds are not considered pension income. Contributions are not tax-deductible and withdrawals do not generate T4s. As a result, from a Canadian perspective, there are no tax forms to be sent to clients unless the TFSA holder is deceased as indicated above on T4A, RELEVE 1 and NR4. There are no tax charges levied by RBC on withdrawals and income except for non-qualified investments. However, all required transactions are reported to CRA. These may include contributions, withdrawals, marriage breakdowns, non-financial information and/or any transaction on a non-qualified asset. CRA will determine if the client has over contributed, determine the new contribution level if over contributions or withdrawals have been made, or charge tax on non-qualified assets. This communication is between the client and CRA. Other than reporting the required transactions Canadian Wealth Management Operations are not involved in the process. Non-compliant TFSA: Required accuracy of non-financial information As recently as last year, the CRA has informed us that they will begin to scrutinize the non-financial information that Tax operations provides to the CRA annually for TFSA accounts. If the information does not match what is on file at the CRA it is possible that the TFSA account may not be deemed as such and consequently considered as a taxable account for every year the information is delinquent. For these accounts, it is imperative that non-financial data is up to date and correct for each and every year of existence of the TFSA account as this information is used by the CRA as one of the criteria to confirm validity of the tax free status of the account. Specific non-financial information under scrutiny in particular are: date of birth, date of death (if applicable), surname, and Social Insurance Number (SIN). Please be extremely cautious when opening a TFSA account and ensure to verify your client’s birthdate, SIN and surname against current identification. If CRA finds a discrepancy, Tax operations is informed and we correspondingly provide an e-mail message to the affected Investment Advisors/Councillors to inform of immediate remediation. If not completed prior to yearend it is possible that the account will be deemed a ‘taxable trust of which appropriate taxation is reported to the client and the CRA.

Non-compliant TFSA Frequently Asked Questions:


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We have received a notice from Tax Operations indicating the TFSA account required an updating and correction of non-financial information. If the client chose not to provide the required updated information what would be the consequence? It is possible that CRA will now consider the account(s) a non-tax shelter consequently subject to taxation, associated interest, and penalties from the point in time the CRA considers the account unsheltered. As the consequences are extreme, tax operations reserves the ability to take measures to limit the risk of lack of compliance. Such measure may include freezing the account.

We have received a notice from Tax Operations indicating the TFSA account required correction. Does the account require correction if the account is closed and no longer appears on our systems? Any accounts that were never corrected and have subsequently closed still require correction. In this particular case please contact Registered Tax operations team with the correct Date of Birth, Social Insurance Number, or

surname.

Please refer to the Tax Advisory Group’s TFSA web site for more information on CRA calculations and penalties, http://advisornet.fg.rbc.com/taxfreesavingsaccount/cid-188424.html. TFSA tax reporting from a US perspective From a US tax reporting perspective, TFSA’s are not exempt from US tax reporting or withholding from the Internal Revenue Service (IRS) under article XXI of the Canada-US tax treaty. Thus, if the US person holding the TFSA earns US source dividends only, US tax slips (1099) will be provided for such taxable events within the TFSA. If the TFSA account holder is a non-US persons or undocumented, the income produced by US source assets in the account may be subject to withholding taxes as designated by the status of the client. If the client is a non-US person (i.e. Canadian resident) the US assets in the account may also be subject to withholding tax based on the treaty rate.

mailto:Liu,%20Ally%20%[email protected]%3e

http://advisornet.fg.rbc.com/taxfreesavingsaccount/cid-188424.html

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MUTUAL FUNDS GENERAL INFORMATION REGARDING MUTUAL FUND TAX RECEIPTS

Online DOCUnet Viewing and Amendment Forms

T3 REPORTING FOR MOST MUTUAL FUNDS IS ISSUED BY THE MUTUAL FUND COMPANIES DIRECTLY. AS A RESULT, THESE PACKAGES WILL NOT BE

AVAILABLE ON DOCUNET FOR ON-LINE VIEWING, WITH EXCEPTION TO ROYAL MUTUAL FUNDS INC. (RBF).

TO REQUEST AN AMENDMENT TO A TAX PACKAGE, PLEASE FOLLOW THE PROCEDURES AND COMPLETE THE MUTUAL FUND AMENDMENT REQUEST

FORM.

Types of Tax receipts: 1. Clients who own mutual funds will receive a T3/R16 to report taxable distributions.

2. Clients who buy a Labour Sponsored or Venture Capital fund will receive a federal T5006 slip and/or a provincial tax credit certificate.

3. Clients who buy a mutual fund in an off book RSP will receive a contribution receipt from the Fund Company.

4. NR4 issued to non-residents. Tax receipt scenarios that you may encounter:

Client has not received one of the above receipts: Contact Fund Company directly to request duplicate. If the reason the client has not received a receipt is because the address is incorrect at the Fund Company, then follow the instructions and complete the Mutual Fund Amendment Request Form.

Client requires a duplicate receipt from Royal Mutual Funds Inc. (RBF): Duplicates of these forms are available on DOCUnet.

The SIN# is incorrect on their receipt. Complete the Mutual Fund Amendment Request Form.

The name is incorrect on their receipt due to marriage, divorce or death: Complete the Mutual Fund Amendment Request Form. NOTE: Estate splits will no longer be completed. If the account is an Estate we can update the account going forward. However the tax receipt will not be updated as it can be used as required (Estate or Individual).

Client received tax credit that is spousal and should be non-spousal, or vice versa: Complete the Mutual Fund Amendment Request Form.

Client received a T3 and it should be an NR4. (N.B. Some Fund Companies will not adjust these) Complete the Mutual Fund Amendment Request Form.

Client did not receive a contribution receipt for an off book RSP account purchase. Contact Fund Company directly to request duplicate. If they indicate that the account was not opened as a registered account, then follow the instructions and complete the Mutual Fund Amendment Request Form.

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If you come across a situation not outlined above or wish to escalate a problem, please email Trina de Weerdt, Supervisor, Mutual Funds Client Service.

DIRECT REQUEST FOR DUPLICATE TAX RECEIPTS FROM FUND COMPANIES Since 2015 tax year, the branches have been able to request original duplicate tax receipts be mailed directly to the client from the fund company or access duplicate PDF* using FUNDcom for non-RBC fund companies. Presently branches can only access duplicate tax receipts of original and amended RBC Funds on DOCUnet. This enhancement will allow branches to access or action on non-registered original tax receipts for non-RBC funds. The link to the FundSERV Inc. website can be directly accessed from Advisornet as per the graphic below. Please request access to this link via AAA.

To utilize FUNDcom:

1. Provide the appropriate information on the search screen such as DS/DI Dealer code (required), Fund company of the tax receipt in question and client account number.

mailto:[email protected].

mailto:[email protected].

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2. Choose From date and a To date for the timeframe requested. The latest date available will be the

current date. Click Submit to view the results.

3. To action the tax receipt, choose ‘Mail to Client’ or ‘Request PDF’. a) Clicking the PDF icon will provide a link to the PDF file. Click ‘Available’ to view the tax

receipt in a new window. Note: FUNDcom cannot show more than 20 receipts at a time, so if a specific tax receipt you searched for is not displayed it may be that a narrower date range is required. If “N/A” is displayed, please contact the fund company directly to obtain a duplicate tax receipt.

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Not all tax receipts will be available via PDF. In those cases, ‘Mail to Client’ will be the only option. b) To have duplicate tax receipts mailed to the client, select the non-registered tax slips required

and then click on ‘ Mail All Selected Receipts to Client’. A display will appear that lists the client’s address and whether the request was a success. If “N/A” is displayed

please contact the fund company directly to obtain a duplicate tax receipt.

*Although the infrastructure/website has been built, only the direct delivery functionality to clients has been mandated for the fund companies. The process of providing the PDF of non-registered tax slips is only provided at the availability and discretion of the fund company. In light of this, this functionality may be limited in nature. For any questions on access to the FUNDcom website, please contact AAA. For questions about the usage of the website itself, please contact Trina De Weerdt

FUNDcom functionality Frequently Asked Questions:

My client requires a duplicate amendment of the non-registered tax receipt from the fund company. How does my client obtain this? Unfortunately, this type of tax receipt is not available through FUNDcom. Please retrieve this tax receipt through normal procedures as described in this Mutual Fund Section.

My client has recently moved and thus the Mail selection does not apply to my client. Is it possible to have the non-registered tax slip made available to us in the branch for the client to pick up?

mailto:[email protected]

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The PDF version of the non-registered tax receipt is only available through FUNDcom at the discretion of the fund company. If it is available, a PDF attachment will appear on the website that will be available for printing. If not, please retrieve this tax receipt through normal procedures as described in this Mutual Fund Section.

WHO CAN I CONTACT AT HEAD OFFICE? Mutual Fund T3s/Tax Credits – T3 reports for most mutual funds are issued by the Mutual Fund companies directly. For amendment requests, please refer to the Mutual Fund amendment request procedures. RBC Direct Investing representatives can access fund company information from the mutual fund database directly. You may also visit the following link for a list of fund companies and their contact information. http://advisornet.fg.rbc.com/positions/cid-272943.html

SUMMARY OF SECURITY DISPOSITIONS – (included in T5 tax package) (A) Tax-Deferred Mutual Fund Switches Please refer to the manual posted on AdvisorNet at http://advisornet.fg.rbc.com/mutualfunds/cid-178182.html to ensure that your client’s holdings are being handled appropriately during tax season. More information about ‘F’ Units and Tax-Advantaged funds can be found in the “Mutual Funds” section of AdvisorNet. (B) Mutual Fund Automatic Withdrawal Plans As in previous years, we are including dollar proceeds for mutual fund automatic withdrawal (AWD) plans. Clients enrolled in AWD programs receive funds directly, on a monthly basis, by the Mutual Fund Company. The dollar amount of these transactions does not flow through the client’s RBC account, and therefore no dollar amount would otherwise be reflected in the Summary of Security Dispositions. The Summary of Security Dispositions will show the dollar value of these redemptions – this should make it much easier for clients to calculate gains/losses.

http://advisornet.fg.rbc.com/positions/cid-272943.html

http://advisornet.fg.rbc.com/mutualfunds/cid-178182.html

http://advisornet.fg.rbc.com/mutualfunds/cid-178182.html

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ESTATE & TRUST PROGRAMS

GENERAL INFORMATION, INQUIRIES & SERVICE

WHO CAN I CONTACT IF E&T IS THE TAX PREPARER?

Please refer to the following email address for additional information where RBC Estate and Trust Services is the Tax Preparer, [email protected]

RBC Estate and Trust (additional information) DISCOUNT INSTRUMENTS - the maturity of a discount instrument is NOT CAPTURED in the interest portion of the T5. Details are provided in the Summary of Security Disposition for the client to file accordingly. Discount instruments sold prior to maturity will be captured in the Summary of Security Disposition and have their interest embedded in the amount. MUTUAL FUNDS (HELD ELSEWHERE) – the tax package does not recognize these transactions therefore income and capital gains will not be reported in the tax package, the client must rely on their T3 and Statements from the Mutual Fund Issuer.

TAX FREE SAVINGS ACCOUNTS (TFSA) * not applicable to E&T

MUTUAL/POOLED FUNDS

GENERAL INFORMATION REGARDING MUTUAL/POOLED FUND TAX RECEIPTS Most Mutual Fund companies issue their own T3 tax packages. Exceptions to these are:

RBC Private Pools Series O:

Reporting will be done by RBC Asset Management. The procedures for amendments are outlined below.

Duplicates can be obtained on DOCUnet.


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WHERE CAN I GO FOR MORE INFORMATION?

Internal Sources Canadian Wealth Management Operations has published additional information on Advisornet at the

following Tax Reporting Site http://advisornet.fg.rbc.com/taxreporting/ including; 2017 Survival Guide for Tax Reporting (this document)


Client Guides to 2017 Tax Reporting – Expanded Guides included in T5 tax packages for clients in the Access, Parameters, Advisor, Private Investment Management, Accounts Programs http://advisornet.fg.rbc.com/taxreporting/cid-180911.html

2017 Tax Reporting Frequently Asked Questions http://advisornet.fg.rbc.com/taxreporting/cid-180901.html

RBCDS Site: Tax Reporting Tool, http://www.rbcds.com/TaxReporting/home.html

For additional information on Tax Topics Financial Advisory Support can be reached via email at ‘Financial Advisory Support’ or at (1-877-722-3278). Their website is located below:


For more information on RBC PRIVATE POOLS SERIES F please contact RBC Dealer Services at 1-800-662-0682.

External Sources Additional general tax information can be obtained from the following websites:

Canada Revenue Agency https://www.canada.ca/en/revenue-agency.html

Revenue Québec https://www.revenuquebec.ca/en/

Bank of Canada http://www.bankofcanada.ca/

Financial Advisory Support Facts http://advisornet.fg.rbc.com/ More information about U.S.-based Tax Forms can be found in the Internal Revenue Service Website,

www.irs.gov

http://advisornet.fg.rbc.com/taxreporting/




http://www.rbcds.com/TaxReporting/home.html


https://www.canada.ca/en/revenue-agency.html

https://www.revenuquebec.ca/en/

http://www.bankofcanada.ca/


http://www.irs.gov/

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AMENDMENT REQUEST PROCESS AND FORMS(Regular)

The tax amendment process for registered and non-registered tax reporting changed last year to reflect more convenience and accuracy for the branch users. Registered amendments will not require the form but non-registered amendments will still require this form. Please contact your Middle office service team for any questions regarding amendments to registered tax forms.

The following are the most common non-registered tax amendment scenarios: 1. Client Name and/or SIN are incorrect on the Tax Package: If an incorrect Name and/or SIN appeared on the tax forms, an amendment request can be submitted. NOTE: If a request is received to change the ordering of beneficiaries on a T5 slip or the SIN reported on a T5 slip, careful consideration should be given to the request and assurance should be made the client account agreement and signature documents correctly reflects the true beneficial owners on the joint account. Also, another very important point CRA makes clear in the T5 Guide is “the onus is on the account holders to ensure that each individual reports their fair share of the income.” Therefore, RBC should not be accepting requests to change or reprint T5 slips with different names of beneficiaries, or using another individual’s SIN other than the “primary” representative on the account. 2. Client changed Country or Province of residency within the tax year: The client will receive a tax package based on their address at the end of the calendar year. However, if the client has moved in and/or out of the province of Quebec, an amendment can be requested. NOTE: If the client has moved or in/out of a different country within the tax year, an amended tax forms cannot be requested as CRA doesn’t refund the funds once paid. The onus is upon client to complete the NR7R to claim back the tax withheld. 3. Estate Account Split: NOTE: Estate splits will no longer be completed except for JGBRS accounts. According to CRA there is no requirement to produce a T5 slip up to date of death and a second slip after date of death. The onus is on the beneficial owners or the Estate’s Executor to report the appropriate share of income in the tax return of the deceased individual. 4. Tax Recipient Code changes If an incorrect Tax code appears on the tax forms due to account changes (example: Joint to Individual) or incorrect account opening/documentation issues, an amendment request can be submitted to correct the tax code. 5. Book/Native Cost Adjustments on Summary of Security Dispositions

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The cost and/or disposition amounts appearing on the Summary of Security Dispositions can be corrected by submitting an amendment request. Submitting a Non-Registered Amendment Request: To submit an amendment request for any of the above scenarios, a tax amendment request form is required. Please refer to the Tax Amendment requests to obtain the amendment form and procedures on submitting your request. For scenarios that do not fit into the above, please submit a Servicelink request, providing full explanation of the required amendments, impacted tax slips/forms and any other documentation that supports the request for the amendment. The Servicelink request should be sent using the following Category/Subcategory/Function:

Category: Reporting Subcategory: Client Tax Reporting Function: General Tax Forms Inquiry

MUTUAL FUND AMENDMENT REQUEST PROCESS AND FORM Branches/Direct Investing can request amended Mutual Fund Company Tax forms by submitting a Mutual Fund Amendment Request Form to the Mutual Fund Department through ServiceLink . Please complete the attached Mutual Fund amendment request form and submit through the following ServiceLink queue along with all supporting documentation. Select Case Type> Inquiry Request Category > Reporting Subcategory > Mutual Funds Function > Tax Forms Inquiry The following information is required to complete the form: 1. Your name and contact information 2. Client Name 3. Client Account Number 4. Fund Company Name and Account Number 5. Name of tax form to be amended 6. Full explanation of amendment required If the amendment request is for a Tax Credit from a Labour Sponsored Fund or an RSP Contribution Receipt, the Fund Company requires that the incorrect tax receipts be returned. Therefore, instead of sending these requests through Service Link, please print off and complete the form. Attach the receipt to the form and forward via interoffice mail, to Mutual Funds Trading, 180 Wellington St W, 11th Floor, Toronto, ON, M5V 3K7. Upon receipt of your request, a letter to the Fund Company will be prepared to request the amendment. The Fund Company will issue the revised receipt to the client directly.


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MUTUAL FUND TAX RECEIPT AMENDMENT REQUEST FORM

Date: __________________________________________

Branch Contact Name: ___________________________

Phone Number: _________________________________

Branch Name: __________________________________

CLIENT INFORMATION:

RBC Account Number: ____________________________

Client Name: _____________________________________

Fund Company: ____________________

Fund Company Account Number: _____________________________

Receipt is wrong _____ Receipt has not been received _____

____T3

____Tax Credit (the incorrect receipt must be attached)

____RSP Contribution Receipt (the incorrect receipt must be attached)

____ Other, please specify: _________________________________________

Tax Year: Current _____ other, please specify___________________________

Description of Problem: (Mandatory)

Please complete this amendment request form and submit through the following Service Link queue along with all supporting documentation. Select Case Type> Inquiry Request Category > Reporting Subcategory > Mutual Funds Function > Tax Forms Inquiry

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If receipts are attached, send to Mutual Funds Trading, 180 Wellington St. W 11th Floor

N.B. Turnaround time will depend on Fund Company volumes, as they will be issuing the amended receipts to the

client.

ADVISOR/PIM PROCESS FOR REQUESTING AN AMENDMENT TO A FEE

SUMMARY LETTER

Branches can request to amend a client’s 2017 Fee Summary Letter for Advisor or PIM Accounts by contacting the Fee Based Operations Team via ServiceLink (an amendment form is no longer required). Procedure To request adjustment of a Fee Summary Letter, please send a ServiceLink request using the following Category, Sub Category and Function: Select Case Type: Action Request Category: Fee Billing Sub Category: Advisor/PIM Request Type: Fee Letters Please include the following information in the “Incident Description” of the ServiceLink case: 1. Client Name

2. Client Account Number(s) 3. Detailed explanation of the requested amendment including date(s) and amount(s) of fee(s) in

question. Upon receipt of the amendment request the Fee Billing Operations team will review and determine if the amendment can be processed. Please allow 2-3 working days for amendment requests to be completed. If the request cannot be completed for any reason or without further detail you will be advised by the Fee Billing Operations team within the standard SLA for ServiceLink cases. The revised Fee Summary Letter will be sent directly to the branch. It will be the branches responsibility to forward the amended letter to their client(s). **Please note, the firm is not permitted to forward tax forms to third parties unless client has provided written authority to Branch to direct forms accordingly. REQUESTING DUPLICATE RBF FUND TAX RECIEPTS FOR ECA ACCOUNTS

Email [email protected] for all RBF duplicate tax slip requests Provide the following information in the email: Fund Company – RBF Funds Investor Name: Investor Fund Account # Form Type: Requested Tax Year: Dealer /Rep Code: Turnaround time for duplicate tax slip request is 24-48 hours.
