Capital gain and loss tax rules

Preparing Canadian Income Tax Returns - Introductory Course

MODULE 1 - COURSE ADMINISTRATION, GUIDANCE & ADVICE

Welcome to the Personal Tax Course! Take at your own pace and keep coming back for refreshers (2:34)

1.1 - WELCOME TO THE COURSE - HOW TO LEARN PERSONAL TAX

The teaching approach and learning methodology for this course (6:09)
A note on Provincial taxes, returns and associated schedules (4:13)
COURSE NOTES & MANUAL - Download course notes and manual and how to use them (4:17)
Additional comments and suggestions on how to use the notes
** ANNUAL UPDATES ** - Instruction video on how to access this year's current update (2:16)

1.2 - COURSE ADMINISTRATION - REFUND POLICY - CERTIFICATES - QUESTIONS

How the course is laid out and how to navigate the system (6:09)
Asking the right questions and what I cannot answer (3:26)
Administration - Course Payments, Refund policy, certificates of completion (6:25)
Emailing students important updates and new courses - Put us on your safe list! (2:03)

1.3 - TAX SOFTWARE: EVERYTHING YOU NEED TO KNOW & STRATEGIES

Common questions on tax software and what you need (4:40)
TAX SOFTWARE - Student Version of Profile Tax Suite - Download & Registration Instructions (4:41)
TAX SOFTWARE - Additional video and troubleshooting on Intuit Profile (7:49)

MODULE 2: THE CANADIAN INCOME TAX SYSTEM

Introduction to this module and what we'll be covering in this unit (2:40)

2.1 - HOW THE CANADIAN TAX SYSTEM WORKS

Who must file a tax return (3:23)
Why you should file an income tax return (5:46)
The Canadian tax system and how it works (3:42)
Deadlines for filing personal tax returns (6:00)
Filing penalties and interest for late filed returns (4:41)
Instalment payments and when they should be made (3:53)
E-filing of personal tax returns and the e-file system (4:10)
The marginal tax rate system in personal tax (5:14)
Example illustrating marginal vs. personal tax (6:06)
Another important tax concept - Tax deductions vs. tax credits (4:51)
Examples of a tax credits and tax deductions (4:14)
Notice of Assessments and their importance (5:09)
An example of a Notice of Assessment (NOA) (3:51)
Notice of Reassessments issued by CRA and their Importance (4:04)
Example of a Notice of Reassessment (4:38)
Some resources on Provincial tax brackets for your reference (5:02)
CRA Online services and an overview of the system (4:36)

2.2 - OVERVIEW OF THE PERSONAL T1 RETURN & SCHEDULES

Introduction to tax forms and information slips (2:49)
The T1 General Return (10:48)
Schedule 2 - Amounts transferred from spouse (2:41)
Schedule 3 - Capital gains and losses (3:37)
Principal Residence Dispositions - Schedule 3 - 2016 & Future Years - Disclosing Sale of Principal Residence (2:29)
Schedule 5 - Details of dependants (3:49)
Schedule 6 - Canada Workers Benefit (2019 & later) - formerly Working Income Tax Benefit (Pre 2019 returns) (3:03)
Schedule 7 - RRSP worksheet and activity (4:38)
Schedule 8 - Canada Pension Plan (CPP) Contributions & Overpayment (4:03)
Schedule 9 - Donations and Gifts (2:08)
Schedule 11 - Tuition worksheet (2:43)
Schedule 13 - Employment Insurance Premiums on Self Employment (2:06)
Schedule 15 - FHSA Contributions, Transfers and Activities (2:39)
Provincial Forms and schedules and web link to find information on Provincial credits (6:17)

2.3 - OVERVIEW & EXPLANATION OF TAX SLIPS

Slip system of reporting income on the T1 personal return (6:33)
Reporting information from T-slips into tax software (2:46)
The T4 slip - The statement of employment income (6:40)
The T4A slip - Statement of Pension, Retirement, Annuity, and Other Income (4:10)
The T4E slip - Employment insurance and other benefits (3:34)
The T5018 slip - Statement of Contract Payments (3:39)
The T5007 slip - Statement of benefits - Social security (2:40)
The T4A(P) and T4A(OAS) slips - CPP and OAS retirement pension slips (4:34)
The T4RSP slip - Statement of RRSP Income (4:07)
The T4RIF slip - Statement of Income From a Registered Retirement Income Fund (3:27)
The T4FHSA Slip - First Home Savings Account Statement (2:26)
The T3 slip- Statement of Trust Income Allocations and Designations (5:28)
The T5 slip - Statement of Investment Income (4:50)
The T5013 slip - Statement of Partnership Income (3:54)
The 5008 slip - Statement of Securities Transactions (4:59)
The T2202A slip - Tuition and enrolment certificate (3:49)
The Auto Fill my Return service offered by Canada Revenue Agency (6:50)

MODULE 3: EMPLOYMENT INCOME & DEDUCTIONS

Introduction to employment income and employment expenses (2:09)

3.1 - EMPLOYMENT INCOME & RELATED TAX CREDITS

Employment income - What is included (7:17)
Recording employment on the T4 slip and T1 (8:37)
Items to watch for on the T4 slip and how to avoid common errors (5:22)
Employment amounts reported on the T4A and T4PS slips (3:34)
Reporting amounds for casual labour, tips/gratuities and odd jobs when not reported on a slip (7:08)
Reporting tips, odd jobs and labour on the T1 return (4:22)
Wage-loss replacement plan reporting (4:42)
CPP and EI premiums and tax credits (7:31)
Filling out the Schedule 8 and T2204 for CPP and EI overpayments (4:30)

3.2 - DEDUCTING EMPLOYMENT EXPENSES

Employment expenses - What cannot be claimed (4:07)
Employment expenses - Who can claim them and how (5:01)
The T2200 form - Review of the declaration of conditions of employment (7:15)
The T777 form - Statement of employment expenses (4:07)
An overview and the framework for deducting employment expenses on the T1 (5:11)
Example of a simple T2200 and T777 with vehicle expense deductions (8:08)
Overview of the two different types of vehicles allowances and tax implications (3:30)
What if a vehicle allowance is received? - how to factor in reimbursements (4:29)
What if a non-taxable kilometre allowance is received from the employer? (5:20)
An overview of home office expenses - What you can claim and what you cannot claim (5:50)
Criteria and process for deducting home office expenses for employees (5:59)
Example of home office expense deductions on the T2200 and T777 (3:44)
Example of a straight forward T2200 and T777 with other expenses (7:05)
Example of a T2200 and T777 with reimbursed expense (8:19)
Additional eligibility for expenses for commissioned salespeople (6:04)
Example of a T2200 and T777 for a commissioned salesperson (7:28)
Expenses that you cannot deduct as an employee and other various items to be aware of (8:36)
Filing requirements for employment expenses - What you need to file with CRA (2:37)
CRA Guide T4044 For Employment Expenses (2:44)

3.3 - THE GST/HST REBATE & OTHER EMPLOYMENT TAX CREDITS

Claiming the GST/HST rebate and review of the eligibility requirements to get his benefit (3:26)
Example of the process for claiming the GST/HST rebate on the tax return (7:48)
New for 2022 - Overview of the Labour Mobility Tax Deduction for 2022 (7:48)

MODULE 4: INVESTMENT INCOME & DEDUCTIONS

Introduction to investment income and expenses (3:59)

4.1 - INVESTMENT INCOME - REPORTING INTEREST & DIVIDENDS

Interest income and interest producing investments (4:28)
Reporting interest income from T5 slips (3:28)
How to handle joint account and recording income properly (5:14)
Reporting joint account interest on the T1 return (3:06)
Best practice for allocating and reporting various percentage of income reported on T-slips (6:55)
Dividend income and the different types of dividends (6:43)
Reporting ineligible dividends income and tax credits (4:20)
Reporting eligible dividend income and tax credits (4:16)

4.2 - INVESTMENT INCOME - REPORTING CAPITAL GAINS & LOSSES

Introduction to capital gains and losses (4:02)
Capital gain and loss tax rules (4:38)
Examples of capital gain and loss calculations (3:49)
Completing schedule 3 and reporting capital gains on the T1 (4:46)
Reporting capital losses on the Schedule 3 and carry-forward balances (5:35)
Calculating gains and losses on multiple purchases or lots (3:52)
Issues with gains and losses on mutual funds (3:54)
Example of capital gain on mutual funds (4:32)
Complicating factors with mutual funds and where to find help (6:04)
Capital loss carryback and carryforwards (2:58)
Capital loss carryback example & how to fill out the T1A form (7:13)

4.3 - TAX REPORTING FOR PRINCIPAL RESIDENCE DISPOSITIONS

The Principal Residence Exemption (PRE) formula and how it works (3:43)
Reporting on the sale of principal residences and claiming Principal Residence Exemption (5:23)
Example showing the disposition of the principal residence on the T1 (6:30)
New for 2023 & Future Returns - The Property Flipping Rule for disposition of residences in 2023 and future years (3:52)

4.4 - DEDUCTING CARRYING CHARGES & OTHER INVESTMENT INCOME TOPICS

Introduction to the attribution rules (5:19)
Where the attribution rules will not apply (6:05)
Deducting carrying charges from your investment income (6:14)
Deducting interest expense if used to earn investment income (5:31)
How to look up what the marginal tax rate is on investment income (4:23)

4.5 - FOREIGN INCOME REPORTING & THE T1135

Foreign income reporting and verification - Introduction to the T1135 (5:48)
What is Specified Foreign Property and what needs to be reported (5:54)
What are the exemption to Specified Foreign Property that are not reported (5:38)
A review of the T1135 form and overview of the simplified and detailed methods (11:58)
Some common scenarios and how to report foreign income (10:14)
Checking verifying and reconciling the informaton on the T1 and the T1135 (6:50)
Some good news on detailed method reporting for many individuals (5:54)

MODULE 5: RENTAL INCOME & DEDUCTIONS

Introduction to rental income and expenses (3:49)

5.1 - RENTAL INCOME, LOSSES & DEDUCTIONS - REPORTING ON THE T776

The basics of rental income - What is captured in rental income? (3:51)
Rental income or business income? - There are significant differences (4:42)
The T776 Statement of Real Estate Rentals (6:16)
What if there is more than one rental property? Do I need forms for all of them? (4:27)
The accrual and cash methods of reporting income (6:48)

5.2 - DEDUCTING RENTAL EXPENSES ON THE T776 STATEMENT OF REAL ESTATE RENTALS

Rental expenses and what cannot be deducted (7:04)
Interest on mortgages, loans and lines of credit (5:04)
How to apply rental income losses on the tax return (6:29)
Common expenses for rental properties - Direct expenses (4:25)
Other deductible expenses that you may be eligible to deduct (7:31)
Capital expense vs. repairs & maintenance - what you can deduct vs what you capitalize (4:16)
CRA administrative guidelines on repairs and capital (4:38)
The rules for deducting motor vehicle expenses for rental income (8:01)

5.3 - RENTING OUT A PORTION OF YOUR HOME OR VACATION PROPERTY

Renting out a portion of your home and the expenses that can be deducted (3:17)
Preparing the T776 for a property rented out and used for personal purposes (6:49)
Selling your home when you've been renting out a portion (4:30)
Renting out a vacation or other personal property (4:00)
Preparing the T776 when a vacation or cottage property is rented out (4:54)

5.4 - RULES FOR CLAIMING TAX DEPRECIATION - CAPITAL COST ALLOWANCE (CCA)

Prefix to Capital Cost Allowance (New for 2022 & Forward) - Summary of recent changes to the rules (5:23)
Introduction to Capital Cost Allowance (CCA) (5:39)
New Accelerated Investment Incentive to consider and teaching approach (7:15)
The rules for calculating capital cost allowance (CCA) (4:02)
Filling out the CCA schedule on the T776 for the regular rules (3:09)
Applying the new AII rules on the CCA schedule on T776 - late 2018 & later years (5:03)
2022 Immediate Expensing Program - Rules and eligible assets (5:14)
2022 Immediate Expensing Program - Example of appliance purchase on T776 (4:11)
Combining the Immediate Expensing and AIIP Program Rules (4:55)
Additional CCA rules for rental properties (5:39)
Example of claiming CCA and the rules to stop losses (4:02)
Capital cost allowance on appliance and furniture (3:45)
Rules for claiming capital cost allowance (CCA) on land (3:20)

5.5 - SELLING RENTAL PROPERTIES - RECAPTURE OF CCA - TERMINAL LOSS

Example of a capital gain on sale and disclosure on Schedule 3 (4:11)
Selling a property when CCA was claimed as an expense - Recapture rules (3:27)
Example of reporting recapture of CCA on the T776 and tax return (6:33)
Terminal loss rules for CCA and application to rental properties (2:00)
Example of a terminal loss and how to report on the T776 and T1 (3:19)
Factors to consider when deciding whether to claim CCA and caution when advising clients (4:41)

5.6 - OVERVIEW OF OTHER MORE ADVANCES ISSUES

Other advanced issues you should be aware of (6:12)
Certain properties may have GST/HST implications - breakdown of the rules (6:15)

MODULE 6: TAX DEDUCTIONS

Introduction to other deductions (3:17)

6.1 - GENERAL TAX DEDUCTIONS INCLUDING SENIOR PENSION INCOME SPLITTING

Reporting the Pension Adjustment (PA) on the T1 (5:45)
Deducting union and professional dues (4:24)
Pension Income Splitting for Seniors - The 1032 Election to Split Income (6:23)
Example of pension income splitting for seniors and the T1032 (6:12)

6.2 - REGISTERED RETIREMENT SAVINGS PLAN BASICS (RRSP)

The basics of Registered Retirement Savings Plans (RRSP) (4:37)
Where do I find my RRSP contribution limit? (5:27)
RRSP contribution, withdrawal rules and annual RRSP contribution limits (8:35)
Example of RRSP contributions and how to report on the T1 (7:39)
Undeducted RRSP contributions (4:47)
Example of undeducted RRSP contributions (4:30)
Where the CRA reports your unused or undeducted RRSP contributions (3:01)
The rules for making spousal RRSP contributions (6:52)

6.3 - OVERCONTRIBUTING TO AN RRSP

Overcontributions to an RRSP and the adverse tax implications (3:17)
Example of overcontributions to an RRSP (4:40)
Where to find information on RRSP overcontributions (2:01)

6.4 - THE HOME BUYER'S PLAN (HBP) & THE LIFELONG LEARNING PLAN (LLP)

Withdrawing money from the Home Buyers Plan (HBP) (5:04)
How to report HBP repayments on the T1 return and Schedule 7 (4:33)
How to deal with HBP non-payments - partial payments and additional payments (6:41)
The Lifelong Learning Plan (LLP) program under the RRSP (4:59)

6.5 - CHILD CARE EXPENSES - REPORTING CHILD & SPOUSAL SUPPORT

Child care expenses - rules and eligibility (5:51)
Filling out the form T778 for child care expenses (7:26)
Rules for spousal and child support payments (3:56)
An example of how to report child support income and expenses on the T1 (4:47)

6.6 - MOVING EXPENSES

Moving expenses - Rules and criteria (4:16)
Eligible moving expenses you are entitled to deduct on the T1 (4:42)
Ineligible moving expenses that you are unable to deduct (2:42)
Using the Simplified Method for travel and filling out the T1-M form (6:35)

6.7- TAX-FREE FIRST HOME SAVINGS ACCOUNTS (FHSA)

New for 2023 & Future years- The Tax Free Home Savings Account (FHSA) (5:39)
FHSA REPORTING - Reporting deductions to FHSA accounts on the Schedule 15 and T1 return (4:01)
FHSA REPORTING - Withdrawing funds from an FHSA account (7:23)

MODULE 7: TAX CREDITS (REFUNDABLE & NON-REFUNDABLE)

Introduction to tax credits (3:26)

7.1 - INDIVIDUAL TAX CREDITS (REFUNDABLE & NON-REFUNDABLE

General information on the application of tax credits (5:33)
Useful resource & the difference between the tax credit and the actual tax savings (5:23)
How to claim tax credits on software on credits we have examined thus far (5:37)
Transferring unused non-refundable tax credits to a spouse (4:08)
Refundable vs non-refundable tax credits (4:31)

7.2 - INDIVIDUAL TAX CREDITS (NO TRANSFERS OR OPTIONS)

The basic amount and Canada employment amount (4:36)
Enhanced Basic Personal Amount (2020 & Future Years) (4:33)
CPP and EI premium tax credits (5:12)
Calculating CPP and EI overpayments on the T2204 form (2:42)

7.3 - DEPENDANT TAX CREDITS

The spouse or common-law partner amount (3:15)
Amount for eligible dependant credit (5:16)
The Canada Caregiver Amount (9:29)
The Canada Caregiver Amount - Supplementary Amounts (2:28)

7.4 - SENIORS TAX CREDITS

The age amount credit (3:01)
Pension income credit (5:06)
The Multigenerational Home Renovation Tax Credits - Who can claim it? (6:17)
The Multigenerational Home Renovation Tax Credit - Qualifying Renovations (8:08)
Multigenerational Home Renovation Tax Credit - Example of using the Schedule 12 to determine eligibility (7:44)

7.5 - STUDENTS TAX CREDITS

Interest tax credit on student loans (2:51)
Tuition tax credits and the recent changing landscape both Federally & Provincially (6:10)
Claiming tuition, education and textbook credits on Schedule 11 (5:56)
Tranferring tuition, education and textbook credits to parents or grandparents (4:01)
Example of how to transfer tuition to a parent or grandparent (5:26)

7.6 - FAMILY TAX CREDITS (OR INDIVIDUAL WITH PLANNING OPTIONS)

The disability tax credit and how to apply and claim the credit (4:37)
An example illustrating how to claim the disability tax credit (7:53)
Rules for transferring the disability tax credit to other individuals (3:49)
Example of transferring the DTC to an eligible person (4:34)
Rules for claiming the donation credit (5:54)
Claiming donations and filling out Schedule 9 (6:11)
Federal and provincial political donation tax credits (4:11)
Adoption tax credit (4:36)

7.7 - MEDICAL EXPENSES TAX CREDIT

Claiming medical expesenses, rules and eligibillity (4:23)
Medical expenses credit calculation (7:43)
Medical expenses for other dependants (2:21)
Example of claiming medical expenses for other dependants (4:45)
Eligible medical expenses, receipts and making sure proper records are kept (6:47)

7.8 - OTHER PERSONAL TAX CREDITS

The Home Buyers amount credit for first time home buyers (3:15)
Climate Action Incentive credit - Changes to 2021 and future years - No longer part of T1 (4:19)
The Volunteer Firefighters and Search and Rescue Volunteers tax credit (2:10)

BUSINESS INCOME & DEDUCTIONS - REPORTING BUSINESS INCOME ON THE T2125

Introduction to business income and what we'll be covering (3:53)

8.1 - INTRODUCTION TO BUSINESS INCOME & OTHER RELATED MATTERS

Business income reporting issues - personal businesses vs incorporated businesses (4:48)
A review of the personal tax business form - The T2125 Statement of Business Activities (5:15)
The basics of business income and what you need to report it properly (5:58)
Be aware of the pitfalls and dangers of large or consistent losses and hobby businesses (5:50)
Are the expenses reasonable? Or will they trigger a review or audit with CRA (6:10)
The GST/HST account and rules that you need to know for businesses (5:27)
Business registration and other acounts you may need to open (6:46)

8.2 - DEDUCTIBLE BUSINESS EXPENSES & RULES

Beginning our look at expenses and my approach to teaching the content (2:27)
Advertising and promotion expenses (4:34)
Meals and entertainment expenses and what to be aware of (4:35)
Claiming a bad debt expense when customers do not pay (2:57)
Insurance expense deduction (3:28)
Interest expense deduction (3:37)
Office stationary & supplies expense and Office expense (3:24)
Rent expense for leased premises and other equipment (2:56)
Expenses for properties that are owned by the business - Utilities - Property Tax (3:42)
Salaries and wages expense (4:00)
Example of reporting salaries and wages expense on Line 9060 (2:44)
A brief review of other deductible expenses and areas to watch out for (5:27)
Other expenses that cannot be categorized but you want to disclose separately (1:39)

8.3 - RULES & DISCUSSIONS ON VEHICLE EXPENSES

Rules for deducting vehicle expenses on business returns (2:56)
Example of vehicle expense calculation and using the Vehicle Expense Worksheet (5:48)
CRA prescribed limts for CCA and interest expense (5:02)
Maintaining a mileage log and its importance during a CRA review or audit (3:28)
The prescribed rate method and whether it can be used for proprietorships (3:46)
Some issues you may come across and how to deal with them (5:40)
An example illustrating the reporting of vehicle expenses for two vehicles (3:10)

8.4 - DEPRECIATION ON CAPITAL ASSETS - CAPITAL COST ALLOWANCE (CCA)

Revisiting the Immediate expensing rules covered in rental income module (3:59)
Capital Cost Allowaance (CCA) rules for depreciation (5:13)
CCA classes and rates of write-off (5:34)
Example of new asset purchases and filling out the CCA schedule (5:12)
The pool system of additions and disposals of assets and calculating CCA (4:07)
Some examples of how pool system works with dispositions and additions (5:59)
Terminal loss rules and how to calculate and show on T2125 (4:17)
Recapture rules and how to calculate and show on T2125 (3:32)
Example of claiming CCA on vehicles - Class 10 and 10.1 and prorating for business vs personal use (5:32)
Example of immediate expensing on a number of assets purchased (6:48)

8.5 - CLAIMING HOME OFFICE EXPENSES & GENERATING A USEFUL T2125

Home office expenses - who can claim and rules (4:05)
How to claim and report home office expenses on the T2125 and carry-forward reporting (5:51)
The cost of goods sold section and providing useful information (6:08)
Example of two T2125 statement with useful information vs. less useful (4:53)

8.6 - CANADA PENSION PLAN (CPP) & EMPLOYMENT INSURANCE (EI)

Canada Pension Plan (CPP) premium calculations on Schedule 8 the contributions for self-employed (8:42)
Employment Insurance (EI) benefits for the self employed (4:15)
Example of EI premium calculations and Schedule 13 for the self employed (4:42)

8.7- THE CANADA WORKERS BENEFIT (CWB)

The Canada Working Benefit refundable tax credit - formerly the WITB (5:39)
Example of Schedule 6 and filing for the Canada Workers Benefit (WCB) (5:58)
Canada Workers Benefit - Overview of the program and the RC 210 slip (5:15)
Canada Workers Benefit - Reporting the CWB prepayment on the T1 Return (7:04)

CONCLUSION & NEXT STEPS

Conclusion and Next Steps in Your Journey (5:24)

Capital gain and loss tax rules

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