Banking confusion
 

Hi,

I regularly read info on the site, but this is my first post. Hopefully someone may be able to help because I am very confused.

We are very close to completing on the sale of our house in England, and then we will be moving over to SE Calgary permanently.

We are currently renting a small place but will be hoping to buy before the end of the year.

Can anyone suggest which bank we should set up an account with. At the moment my husbands business sorts out the rent and we use our UK CitiBank Canadian Dollar account, but we really need to sort out a Canadian-based account.

When it is up and running can we simply move our money from our CitiBank account to the new Canadian account? We have spoken to our local bank here in England and they were more confused about the situation than us.

Has anyone had the same problem on the build up to moving over?

Any help is much appreciated.

Lou.

Re: Banking confusion
 

Citibank operates in Canada, and there are Calgary branches. They are a bank that is used to international accounts (as is HSBC). You will find it easier to open an Citibank account in Canada (vs another Canadian bank) as you are already a known customer of theirs.

My suggestion would be to open up your account in a Citibank in Calgary, and then transfer your funds internally from CitiBank UK to Citibank Can, it will be much cheaper to do it this way as well.

A friend of mine did something similar when he moved from the US to the UK. And he can control both his accounts in one online profile with Citibank.

I did the same thing using HSBC.

Re: Banking confusion
 

Thank you so much. I may wait until I am in Canada then and speak to Citibank there. The Uk branch do not seem to understand...

Do you know how their exchange rates compare? I will be moving some money from my uk account. I normally use a currency broker, but have been told that Citibank are good too. Did your friend have any comments about the exchange?

Re: Banking confusion
 

As a Citibank customer moving a large amount of money you will get a preferred rate. Lets not kid ourselves, the bank takes a nice cut, but I doubt very much that you will find a better rate (including any commission you pay elsewhere), than the one you get with a Citi > Citi transfer.

RE: Your account. I think it is a good idea to ask/tell Citibank in the UK about your move (as you already did). Keep pressing them, they should have someone who knows what they are talking about. If you are calling, go to a branch instead and speak with a manager.

Re: Banking confusion
 

It's pretty easy to open an account at any Canadian bank. Personally I'd pick a big 5 bank that has the most convenient branches in whatever area I spend most of my time. There isn't much to choose between them. I use TD who are also now in the US. I can withdraw from their Canadian or US ATM's without paying any fees.

Re: Banking confusion
 

I'm a big fan of HSBC and it's what I use here in Canada and for my UK backing.

They offer a special package for new immigrants which is equivalent to HSBC advance. I can bounce money between any of my HSBC accounts for $5 a transaction and with Global View I see everything all in one place - across the UK, Canada and US.

Banking for Newcomers to Canada | HSBC Canada

Re: Banking confusion
 

This is the most cost effective and safest way to transfer and exchange large sums to Canada, especially with house sales etc:

1. Open a regular checking/current account in Canada (I used TD)
2. Open a GBP account at the same bank
3. Wire transfer the money from the UK account to your new Canadian GBP account. This will cost you $10-$50 depending on the institutions. The money lands as GBP, so no exchange yet
4. Monitor the money market and exchange rates, and follow the trend
5. When you feel the exchange rate is looking good, call all the ForEx companies you can find. Tell them the large amount you want to convert, and get the best possible exchange rate
6. Immediately call your bank, ask to speak with the treasury department (in TDs case), and tell them you're ready to convert the money from your GBP account to the regular checking account. Tell them the best rate you got from the ForEx. THEY WILL MATCH IT
7. They match the rate, convert to CAD, and put it in your checking account

You get the best possible rate, with the security and peace of mind of dealing with a large bank - not some hokey shady ForEx company.

It never sat right with me to wire transfer my 250k GBP to some shady ForEx bank account, hoping they'd send me my CAD back in a few days.

Re: Banking confusion
 

While this is a good strategy, the exchange rate that was in place when you landed needs to be taken into account for income tax purposes. Currency Exchange Gains and Losses-Canada : British Expat Wiki

I made a post back in May about the tax implications of exchange rates, it's worth reading and understanding what tax liabilities you might face with trying to get a more favourable exchange rate. http://britishexpats.com/forum/canad.../#post11257134

I'm not sure how it changes when the money sits in a GBP account held by a Canadian bank, and whether the money is the considered to be "in" Canada... Honestly I'm just not sure of the tax implications but if you take Photoplex's route then make sure you understand what your tax requirements are os that you aren't finding yourself in hot water down the road. (It might be finet o do it this way, you may be subject to the same rules I outlined in my previous post... I'm honestly not certain. Hopefully someone else can weigh in.)

Re: Banking confusion
 

Thanks for your advice everyone. This is why I love this forum - so many people willing to help.

Regarding the exchange, I just called my bank and asked for their rate and they told me their rate for today would be 1.7929. My currency company (which is in London) said their rate is 1.83. I have used them before, albeit for smaller amounts, and they didn't seem to have any other charges.

I didn't ask to speak to the Treasury Department (as suggested by Photoplex) but if we change about £150k then my maths (which isn't my strong point) suggests that I get an extra $5500+ by not using my bank! Surely this can't be right???

I haven't got the money yet so maybe the bank may improve their rate when the funds are actually in my account.

Also - there was an advert on TV about HSBC and their accounts around the world. I am going to speak to them to see if they make any more sense than Citi.

Re: Banking confusion
 

Also, sorry for asking so many questions, I have been told about certain currency gains, also mentioned by SchnookoLoly, would this improvement in rate be classed as a Foreign Currency Gain, and be taxable? Or is this simply 'shopping around for better deal'!?

Oh crikey - why is this so confusing?!?! haha!

Re: Banking confusion
 

Hey loulougarthorpe,
Yeh it is super confusing. We are in the exact same position - our house sale should conclude next week, so we'll have quite a bit of money to bring with us to Canada in September. Have been to our bank and they said it'll cost £25 from their end (dont know if the Canadian bank we go with will also charge us or not), and have looked into TorFX. I dont like the idea of giving all our money to TorFX.....but their exchange rate is SO much better than our banks.
Would be good if there was only one option, and it worked out smoothly & was super easy and simple.
Good luck :-)
G

Re: Banking confusion
 

They will!

Re: Banking confusion
 

Yeh, thought that would be the case JonboyE :nod:
Thanks

Re: Banking confusion
 

Read my post. The big trustworthy bank will match the best forex rate you can find. If they can't, you can transfer the money from the Canadian bank GBP account to whatever shady forex company you like.

Re: Banking confusion
 

Banks will not always match a FX brokers rate. We do large transactions regularly in CAD, GBP, AUD and USD, banks matching rates is less common today than it used to be.

It is easier and cheaper to deposit a GBP cheque into an account than wire transfer it.

We use FX brokers, never had an issue, certainly would not cal them shady or hokey. This is how FX transactions are done daily.

If one has deposited the GBP into a Canadian GBP account (not all banks offer them) and you don't get the rate you want from the bank, one is in a bit of a bind and has to accept whatever rate they give you.

With our FX broker, for GBP held in the UK, we do a CHAPS transfer from our bank to theirs to settle the account, very quick, easy and the rate we find acceptable.