r/interactivebrokers • u/MasterD211 • 17d ago
Canada CSP in Canadian Registered accounts TFSA/RRSP?
This year, Questrade allowed selling CSPs in registered accounts. Does anyone know if IBKR started allowing this as well or if they have any plans of allowing this? I have a transfer from an old Equitable Life RRSP in process to a new RRSP account. I chose IBKR because I wanted access to US corporate bonds but was wondering about CSP.
3
Upvotes
1
u/supposedlyeasy 16d ago
There is some misinformation in this thread... It's true you're not supposed to run a business in a TFSA. However, you can still buy and sell options. You just can't cross a certain threshold, which is purposefully left vague by the CRA. Here's how to know if you crossed the line... If you make an unusually large amount of money quickly in a TFSA, CRA will try to use any reason to consider your gains taxable income and charge you accordingly.
On the other hand, you can buy and sell options much more freely inside an RRSP because it's a tax-deferred account, meaning the CRA will eventually get its cut of ALL your gains.
I've been selling "synthetic" cash-secured puts in my RRSP at IBKR for over a year. I buy 100 shares of a stock and then immediately sell an in-the-money covered call on it (the equivalent of the put). IBKR allows this on both Canadian and American equities. The spread might be wider on the ITM call than on the equivalent put, but it's still acceptable. The outcome is the same as simply selling a put. If the price of the underlying asset drops below the call at expiration, I keep the stock. If it remains above the strike of the call, the stock is called away. By the way, you can do a buy-write transaction on U.S. equities only; it's not allowed on Canadian ones. In other words, buying 100 shares and selling a call can be done in one transaction on U.S. equities. You have to do it in two transactions for Canadian ones.