How to Buy ETFs in Canada (2026 Guide)
Unlike the UK, Canadian investors generally can buy US-listed ETFs like VOO or VTI directly. The bigger decision is which tax-advantaged account to use, and there's a withholding-tax quirk that catches a lot of people out.
Educational content — not financial advice. Tax rules change; confirm current contribution limits with the CRA before acting.
TFSA vs. RRSP: the first decision
| TFSA | RRSP | |
|---|---|---|
| Tax treatment | Grows and withdraws completely tax-free | Contributions reduce taxable income now; withdrawals are taxed later |
| 2026 contribution room | $7,000 for the year (cumulative room since 2009 for long-time residents) | 18% of last year's earned income, up to a CRA-set annual maximum, plus any unused carry-forward room |
| Best suited for | Flexible, any-purpose saving — can withdraw anytime without penalty | Retirement saving specifically, especially if your marginal tax rate will be lower in retirement |
| Withdrawal rules | Withdraw anytime; room is added back the following calendar year | Withdrawals are added to taxable income in the year taken out |
Many Canadians use both over time — maxing the TFSA for flexible saving, and the RRSP more specifically for retirement, taking advantage of the upfront tax deduction. Check your exact contribution room in your CRA My Account before contributing, since limits and carry-forward room are individual to you.
The US withholding tax quirk
Canada and the US have a tax treaty that exempts RRSPs from the 15% US withholding tax normally applied to dividends paid to foreign investors on US-listed securities — but that exemption specifically does not extend to the TFSA, because the US doesn't recognize a TFSA as a retirement account under the treaty. In practice: holding a US-listed ETF like VOO inside an RRSP avoids the US withholding tax on its dividends; holding the exact same ETF inside a TFSA does not.
Step by step
- Open a brokerage account. Questrade and Wealthsimple are popular commission-light options; most major banks (TD, RBC, BMO, CIBC, Scotiabank) also offer direct investing arms, and Interactive Brokers Canada is available for more active investors.
- Choose TFSA, RRSP, or a regular taxable account based on the comparison above.
- Decide US-listed vs. Canadian-listed for the exposure you want, factoring in the withholding tax point above and any currency-conversion fees your broker charges for buying US-dollar securities.
- Place your order. The mechanics — market vs. limit orders, avoiding the first and last 15 minutes of trading — are the same everywhere; see How to Buy Your First ETF in the main guide.
Frequently Asked Questions
Can Canadians buy US-listed ETFs?
Yes. Canadian brokers generally allow trading US-listed ETFs, though you should account for currency conversion costs and, in taxable accounts, US withholding tax on dividends. Canadian-listed equivalents avoid the conversion step.
What is the difference between a TFSA and an RRSP for ETFs?
A TFSA grows tax-free with no tax on withdrawal; an RRSP gives a deduction now and is taxed on withdrawal. One relevant wrinkle for ETF investors is that US dividend withholding tax is generally waived on US-listed funds held in an RRSP but not in a TFSA.
Should I buy Canadian-listed or US-listed ETFs?
Canadian-listed funds avoid currency conversion and are simpler to hold. US-listed funds are often cheaper and far broader in selection. For smaller balances the conversion cost often outweighs the fee saving.
Do I need to worry about currency risk?
Holding US-listed funds means your returns move with the Canada-US exchange rate as well as the market. Over long horizons this tends to matter less than fees and asset allocation, but it does add short-term volatility.
Ready to compare specific funds?
See live grades, fees, and risk metrics for the US-listed funds many Canadian-listed ETFs mirror.