I have received numerous inquiries from people seeking information on non-resident accounts ever since my blog, The Non-Resident Account Experience, was published back in October, 2021. Some inquiries were from local Canadians planning to live overseas and some were Canadians who have previously studied in Canada but have relocated to work overseas. Others have existing Canadian accounts but were told by their financial institution that they could no longer service their non-resident account.

In short, there are a myriad of reasons why a non-resident may want to open a new account, however, the ability to open these accounts continues to be difficult. The need for financial institutions to fulfill their due diligence and screen for anti-money laundering (AML) and terrorist financing have rightfully led to increased scrutiny from the industry. The standards and requirements for non-resident accounts are dynamic and can differ among financial institutions. Therefore, generalities cannot be made industry wide. Overall, it is not unusual for a request to open a non-resident account to be turned down for not meeting specific standards. Although every case is different, from our own experience there are 5 considerations that may act as barriers to one’s ability and desire to seek a non-resident account. We highlight those below:

1. A non-resident should have close ties with Canada. Therefore, a potential non-resident client should have a Canadian Citizenship or a Canadian landed immigrant status.

2. The country that the client is a resident of has to be on an approved list. This list is dynamic and is always subject to change.

3. An ‘Enhanced Due Diligence’ process may be performed to review the client’s source of wealth and the value of their assets. Supporting documents may be requested. This is especially true for international clients (ex-US).

4. Non-resident clients may not self-direct their own portfolio. Therefore, they should be comfortable investing through a discretionarily managed account.

5. Non-resident accounts are not allowed to make use of margin (leverage) or purchase certain investments including mutual funds, derivative products, and new issues (IPOs).

None of the factors or requirements above are exhaustive, nor do they represent standards for the industry at large. If you or a family member may need to consider a non-resident account, please reach out to a member of our team to review your circumstances and considerations.