Investors who own Canadian exchange traded funds and who file U.S. tax returns may be considered to be holders of a Passive Foreign Investment Company (PFIC). Note that all U.S. citizens and green card holders are required to file a U.S. tax return even if they are residents of Canada or another country. Other Canadian residents with significant ties to the U.S. may also be required to file U.S. tax returns.
A PFIC is defined under U.S. tax rules which are intended to prevent U.S. taxpayers from securing preferential tax treatment, such as tax deferrals, from investing in foreign securities instead of U.S. securities. To help investors who file U.S. tax returns avoid the negative consequences of owning a PFIC, Hamilton ETFs is providing PFIC annual information statements for its funds. This allows U.S. taxpayers to elect to treat these ETFs as “Qualified Electing Funds” (QEFs) on their U.S. tax returns which gives U.S. investors access to capital gains tax rates on their holdings of these funds.
The following is a summary of the annual T3 factors on a per unit basis for each of the Hamilton ETFs. Please note that these amounts and proportions may vary from year to year.
For the Year Ended April, 30 2022
Ticker | Fund | Class | Ordinary Earnings (US$) Per Unit/Day | Net Capital Gains (US$) Per Unit/Day | Cash/Property Distributions (US$) Per Unit/Year |
---|---|---|---|---|---|
HBA | Hamilton Australian Bank Equal-Weight Index ETF | E | 0.0025807255 | 0.0033219153 | 1.5157795557 |
HCA | Hamilton Canadian Bank Mean Reversion Index ETF | E | 0.0089737289 | 0.0000000000 | 2.2304254383 |
HCAL | Hamilton Enhanced Canadian Bank ETF | E | 0.0000000000 | 0.0000734677 | 2.8361723618 |
HDIV | Hamilton Enhanced Multi Sector Covered Call ETF | E | 0.0012630898 | 0.0000000000 | 0.9035851433 |
HFG | Hamilton Global Financials ETF | E | 0.0005090474 | 0.0051266248 | 1.4076762361 |
HFIN | Hamilton Enhanced Canadian Financials ETF | E | 0.0011283853 | 0.0000000000 | 0.1700098899 |
HFT | Hamilton Financials Innovation ETF | E | 0.0000000000 | 0.0004081241 | 0.3531169559 |
HUM | Hamilton U.S. Mid/Small-Cap Financials ETF | E | 0.0008847253 | 0.0028127021 | 0.5189876011 |
HYLD | Hamilton Enhanced U.S Covered Call ETF | E | 0.0000000000 | 0.0000000000 | 0.3243563598 |
HYLD.U | Hamilton Enhanced U.S Covered Call ETF | U | 0.0000000000 | 0.0000000000 | 0.4360324356 |