Some good info ... but it's a bit disjointed and could easily result in beginners confusing separate concepts.
To return to the OP's question,
The "problem" is, doesn't DRIP'ing these in my non-reg account create a tax nightmare?
In my experience ... it is rare that a DRIP will result in a taxable event beyond the cash that was paid.
What is added by the DRIP is bookkeeping to apply the DRIP purchase price/units bought to the adjusted cost base (ACB).
To use the simple example of a stock that pays eligible dividends, the taxable event is reporting the dividend income on one's yearly tax return.
This will have to be done, DRIP or no DRIP.
If there is a DRIP, then for each dividend amount paid that exceeds the DRIP share price, one or more shares will be added.
The bookkeeping is to add in the additional cost to the ACB. This is same as if the investor bought the one or more shares by ordering them.
Ex. Shares have a current ACB of $600 for 100 shares, May dividend payment for all shares is $10, DRIP price is $7.
New share count is 101, new ACB = old ACB + cost of new shares = $600 + (1 x $7) = $607.
Some investments such as ETFs, MFs and trusts pay a mixture of income. Return of Capital (RoC) is tax deferred until the ACB is negative and reduces the ACB. This also adds more bookkeeping as usually the RoC breakdown isn't reported until the following year.
So before considering a DRIP, one needs to recalculate the ACB.
Example, trust ACB is $600 for 100 units, May cash distribution is $10 - where $1 is RoC.
Units are still 100 where new ACB = old ACB - RoC = $600 - $1 = $599.
So if this trust is DRIP'd, with the same DRIP price for one unit, then the combination of the two is that first the RoC reduces the ACB to $599 and then the DRIP increases the ACB by $7 = $599 + $7 = $606 for 101 units.
So it's pretty difficult to end up with a taxable event as a result, unless the cash distributions are high, the RoC portion is high and the current DRIP price is really low.
The key point here is that RoC as part of the cash payments means the extra calculations - the DRIP is only adding more recalculations.
That said .... I usually wait for the breakdown and then sit down with my spreadsheet in one sitting.
I agree that RioCan is best held in a TFSA (or RRSP) if:
a) one does not want to do the bookkeeping.
or more importantly,
b) in 2013, 61.77% of the cash paid was treated as income so that it was taxed the same as interest with only 0.52% RoC.
http://investor.riocan.com/Investor-Relations/distribution-info/Income-Tax-Information/default.aspx
(This is the same idea as to why to put a GIC in a registered account versus a stock with dividends.)
Trusts I have that pay 80% RoC, I prefer in a taxable account as in exchange for the bookkeeping, I pay tax on 20% and the other 80%, nothing for at least the next three years or longer. If I DRIP, then likely I will only pay capital gains taxes when I sell.
Cheers