# T5008 is screwing me



## Tostig (Nov 18, 2020)

I just received my T5008 from BMO Investorline today. It's supposed to represent my Capital Gains report table of Schedule 3 but I guess I have to input the data as reported by BMOIL.

So I decided to check one of securities it has reported against the actual records I have.

Right away I see a big problem. 

1) Although it has reported a sell on August 25, 2020 with the correct value in Box 21, it does not list the proper costs at the buy date of January 18, 2018 at $4788.05. Instead it has listed a number in Box 20, $4655.75 that I can't seem to replicate. I had held this position at a loss for for several years and sold to recuperate my money for at capital gains of $0.20. But if I input Box 20 of the T5008, my capital gains becomes $132.50.

2) There are two lines, a buy and a sell, that match my 2020 records in which I bought and sold 90 shares for a capital gains of $1.40. The purpose was to reposition at a lower buy price so I simply recuperated my cash. No problem here except Box 20 lists an amount, $4466.57 that doesn't match either the 1) above or the buy amount of this transaction. And the way the T5008 lists them as two separate items, the sell would be a slight loss where the buy is left hanging.

3) Lists a sell record dated November 12, 2020 with Box 21 which I can match in my own records. But the problem here is the buy date for this transaction was on April 12, 2018 for $4523 which is not list in the T5008. Instead, it lists Box 20 as $4466.57. My actual Capital Gains is $1.1 but the T5008 would have it as $57.98.

4) T5008 lists a buy record which is correct. Since there is no sell record for this transaction (as I am still holding it) what is its impact on my capital gains tax with this record being listed and reported?

So the T5008 would have me report a Capital Gains of $190.48 as opposed to what I was going to correctly report $2.70 for this one security.

There are US securities which are listed in USD instead of the CAD which I had carefully and diligently calculated when I made the transactions.

I know I have to input the data in the T5008. But that means I'll have to delete the matching records I was going to report in the Schedule 3 Capital Gains table. So I am removing my reconciled buy/sell data with the incorrect records of the T5008.

Any comments?


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## Numbersman61 (Jan 26, 2015)

The best policy is to ignore the book cost on form 5008. Just make sure that your ACB calculations are correct and that you have proper records to document your calculations.


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## AltaRed (Jun 8, 2009)

My first question is whether the security you mention that has errors is a stock or a ETF or mutual fund or USD security. It is possible BMO IL does not get ACB data correctly for ETFs and REITs that have capital re-invested contributions or Return of Capital though in this day and age, they should get that right. On to your specifics...

Firstly, Box 20 cost data is either not sent, or if sent, is not used by CRA. Cost data is for you to ascertain to be correct numbers. If you are certain you are right, use your data. CRA is unlikely to question your Cost Basis, but if they ask, you will need to show documentation for your Cost Basis data. I have always used my Cost Basis.

As for USD T5008 data, that is for you to get correct on your Schedule 3. BMOIL does not convert it to CAD most likely because it does not keep track of Forex data on a daily basis in its system. Only you know what the forex rate was on date of purchase, and again on date of sale.

The buy data on the T5008 for a holding that is not yet sold is useless information. I noticed that on my T5008 as well and it should be ignored (nothing to report anyway since you have not sold it).


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## Tostig (Nov 18, 2020)

Thank you Numbersman61 and AltaRed. I googled the term "problems with T5008" and there was a June 2020 court case against TD for inputting incorrect data.

AltaRed: The security with all the errors is Dollarama, DOL. If you look at its stock price for the dates I listed, you'll understand what I was doing to recuperate my original investments.

So I will just use my own data. If CRA looks at my sold securities, they will all be listed with matching Proceeds but different Costs Bases and all they have to look is the date of acquisition.

And if I have to, I will print out and send CRA the buy and sell transaction confirmations.


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## jargey3000 (Jan 25, 2011)

has anyone ever had a capital gain (or loss) questioned by CRA.?
jus asking, because I'm not the most accurate bookkeeper, and I never have.


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## Money172375 (Jun 29, 2018)

Remind me, if a company is bought out and you receive new shares, you don’t have any taxable transaction right? It’s only taxable when you receive cash? Would a company which was bought out and provided you new shares appear on t5008? 
it’s been so long since I faced this, but have BPY and MIC to deal with this year.


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## Money172375 (Jun 29, 2018)

Tostig said:


> Thank you Numbersman61 and AltaRed. I googled the term "problems with T5008" and there was a June 2020 court case against TD for inputting incorrect data.
> 
> AltaRed: The security with all the errors is Dollarama, DOL. If you look at its stock price for the dates I listed, you'll understand what I was doing to recuperate my original investments.
> 
> ...


 duplicate


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## Money172375 (Jun 29, 2018)

Money172375 said:


> nice lawsuit. Guy doesn’t file his taxes and blames the bank. And also blames the bank for not being able to find employment. Was Beaver his lawyer.


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## Tostig (Nov 18, 2020)

Money172375 said:


> Remind me, if a company is bought out and you receive new shares, you don’t have any taxable transaction right? It’s only taxable when you receive cash? Would a company which was bought out and provided you new shares appear on t5008?
> it’s been so long since I faced this, but have BPY and MIC to deal with this year.


You'll have to find out from the company's proposal to shareholders what the breakdown between the new shares and the cash is going to be. If they openly without any ambiguous language state percentages in cash or shares, then you can easily do the calculations. If not, then you'll have to look at the value of your holding at the closing just before the conversion and then the morning right after and do the calculations yourself.


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## AltaRed (Jun 8, 2009)

Tostig said:


> Thank you Numbersman61 and AltaRed. I googled the term "problems with T5008" and there was a June 2020 court case against TD for inputting incorrect data.
> 
> AltaRed: The security with all the errors is Dollarama, DOL. If you look at its stock price for the dates I listed, you'll understand what I was doing to recuperate my original investments.
> 
> ...


I don't have the inclination to really think through what you were doing on DOL but it NOW seems to me from first glance that you had 2 purchases of this stock. once on Jan 18, 2018 and another on Apr 12, 2018. Your ACB would actually be a weighted average of those 2 purchases for a blended ACB price per share. It is this latter price you must use for a Cost Basis when calculating cap gains/losses for your sales.

You then sold some shares on Aug 25, 2020 and more on Nov 12, 2020 and perhaps still own some shares? They would need to use that blended ACB price I mentioned from all your 2018 purchases made before Aug 25th, 2020.

My comments in my first post assume you were using the blended share price for ACB. Regardless, as long as you are using the right ACB data, ignore Box 20 of the T5008.


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## like_to_retire (Oct 9, 2016)

I've never used the T5008 slip in the many decades I've been investing and simply keep my own records and enter those numbers into schedule 3. Always works out. Keep good records is the answer.

ltr


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## like_to_retire (Oct 9, 2016)

jargey3000 said:


> has anyone ever had a capital gain (or loss) questioned by CRA.?
> jus asking, because I'm not the most accurate bookkeeper, and I never have.


So this is a good time to start since ultimately you're responsible for schedule 3 data - not your broker.

ltr


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## james4beach (Nov 15, 2012)

like_to_retire said:


> I've never used the T5008 slip in the many decades I've been investing and simply keep my own records and enter those numbers into schedule 3. Always works out. Keep good records is the answer.


I also ignore this slip completely.


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## jargey3000 (Jan 25, 2011)

jargey3000 said:


> has anyone ever had a capital gain (or loss) questioned by CRA.?
> jus asking, because I'm not the most accurate bookkeeper, and I never have.


anyone? curious...


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## Eclectic12 (Oct 20, 2010)

Tostig said:


> ... I know I have to input the data in the T5008. But that means I'll have to delete the matching records I was going to report in the Schedule 3 Capital Gains table. So I am removing my reconciled buy/sell data with the incorrect records of the T5008.
> 
> Any comments?


I have downloaded the T5008 slips from CRA or my broker then compared to my records.
Then Schedule 3, part 3 gets filled out (the numbers either agree or I use my numbers).

I have never entered the T5008 slip (or NetFiled a return that had downloaded it).


So far, differences have not been significant and I have not be asked about it by CRA.


Cheers


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## Eclectic12 (Oct 20, 2010)

jargey3000 said:


> has anyone ever had a capital gain (or loss) questioned by CRA.?
> jus asking, because I'm not the most accurate bookkeeper, and I never have.


Not questioned ... but the year I skipped a CL as I didn't have the numbers handy and did not want to delay filing the tax return, CRA added to my NOA a $0 line for that security.

I filed a change about the middle of the year to get the $0 changed to a $# capital loss.

Cheers


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## Eclectic12 (Oct 20, 2010)

Money172375 said:


> Remind me, if a company is bought out and you receive new shares, you don’t have any taxable transaction right? It’s only taxable when you receive cash?


YMMV ... I have had:
a) only taxable disposition
b) only tax deferred swap
c) default option of a tax deferred swap or choice of a taxable disposition.
d) default option of a taxable disposition or choice of a tax deferred swap




Money172375 said:


> ... Would a company which was bought out and provided you new shares appear on t5008?


I'm guessing that if was a forced disposition then it would show up on a T5008 slip. 
I haven't had a buyout after the T5008 slips started showing up instead of the annual trading summary being labeled "T5008". 


Cheers


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## Tostig (Nov 18, 2020)

Eclectic12 said:


> I have downloaded the T5008 slips from CRA or my broker then compared to my records.
> Then Schedule 3, part 3 gets filled out (the numbers either agree or I use my numbers).
> 
> I have never entered the T5008 slip (or NetFiled a return that had downloaded it).
> ...


I'm going to input into the Schedule 3 Capital Gains table only the data that does not agree with the T5008 and not input them into the T5008. But there are also records in the T5008 that won't appear anywhere else, like purchases in 2020 (without sales).

I'm relying on memory now, but I recall several years ago my T5008 listed all the mutual funds that were sold. The only problem was that I never did really sell my mutual funds. Those were annual rebalancing of my portfolio done automatically as I recalled many years earlier I had instructed them to do.

And then another time, I noticed at the back a note that said it was NOT required to input that data but to keep it for reference.(Maybe it was another T-slip).

My last concern about the T5008 is if an investor sold wants to carry forward the capital loss for another date. If he doesn't report it into the T5008, CRA may make the adjustments themselves and he ends up paying more tax.


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## Eclectic12 (Oct 20, 2010)

I wonder if partial info on both forms will result in CRA's attention? 
All I know is that I have exclusively used Schedule 3, Part 3 without entering T5008 slip info and only downloading copies to see what CRA has.

If you instructed re-balancing, it's a sale - unless it was a corporate MF structure. My understanding is the corporate MF structures no longer allows a rebalance without having to report a CG or CL.

As for skipping the CL T5008 slip causing a problem for carrying the CL forward to a later year - that's not my experience as I ignore the T5008 slip for capital losses and only report it on Schedule 3, Part 3. What I have reported as a CL and what shows up on the NOA as a CL available to use has matched so far.


Cheers


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## Tostig (Nov 18, 2020)

james4beach said:


> I also ignore this slip completely.


I must have done the same thing when it looks like I would be double-counting my capital gains taxes. I think in the back (at least several years ago or another t-slip) it said reporting this was not required.


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## Eclectic12 (Oct 20, 2010)

CRA's own web page about the T5008 says:



> This information slip reports the amount paid or credited to you for securities you disposed of or redeemed during the year ...
> *If you are an individual having to file a T1 return, report transactions on account of capital on Schedule 3.*








T5008 Statement of Securities Transactions – slip information for individuals - Canada.ca


T5008 Statement of Securities Transactions – slip information for individuals




www.canada.ca





It also points out that Box 20 "cost or book value" may or may not be correct where the tax payer is to adjust it as needed.


Basically there is no reason I can see for an individual to use a T5008 on their return.


Cheers


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## Tostig (Nov 18, 2020)

Eclectic12 said:


> I wonder if partial info on both forms will result in CRA's attention?
> All I know is that I have exclusively used Schedule 3, Part 3 without entering T5008 slip info and only downloading copies to see what CRA has.


Probably. I just read the back on another T5008/RL-18 for those mutual funds and at the back it says "This information slip does not have to be attached to your income Tax and Benefits Return,..." Since nowadays most of us are electronically filing, it's not possible to attach that form anyways. So I'm guessing by "attaching", they mean inputting the data.



Eclectic12 said:


> If you instructed re-balancing, it's a sale - unless it was a corporate MF structure. My understanding is the corporate MF structures no longer allows a rebalance without having to report a CG or CL.


It's been so long ago, I can't remember. Either way, I'm inputting those capital gains from my mutual funds because throughout the year, I do see the reductions in the unit holdings that can't be attributed to any other kind of activity.


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## james4beach (Nov 15, 2012)

I'm just guessing at what the CRA does in the back end, but I'm going to guess it works something like this.

They know that many of the things reported in these can't be taken literally. People might journal shares, which completely wrecks the ACB. Then there are forex rates to consider, etc.

My guess is that CRA computers look at your Schedule 3 capital gain/loss total, and then check it against their own calculation based on slips. I would think they would tolerate some significant differences between the two, and maybe they are more tolerant when smaller $ amounts are involved.

They probably flag it and look into it in more detail if the differences are very large, and/or if the $ amounts are huge.


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## AltaRed (Jun 8, 2009)

Seems to be somewhat confusing information being passed around here. The data on the T5008 is what the issuing financial institution sends to CRA regarding a taxpayer's purchase and sale of securities. It will list every single transaction, for example, partial fills on the same trading day. The T5008 slip with all the data is sent to the taxpayer so the taxpayer knows what has been sent to CRA.

The T5008 tax slip has no further use to the taxpayer. The taxpayer provides all his/her acquisition and sales data of securities on Schedule 3. Taxpayers often aggregate data for inputting to Schedule 3. It only matters that the correct data is used to properly calculate capital gains and/or capital losses and what is used to calculate taxes. The tax software actually aggregates all this in the file sent to CRA electronically via NETFILE. That data file is essentially non-recognizable to the taxpayer.

It is not clear to me what the OP is saying his last post in post #18 with respect to Capital Loss Carry Forwards. Capital losses are always credited against Capital Gains in the current tax year to the extent they can offset current capital gains elsewhere in the tax return of the current year. To the extent there is insufficient capital gains in the current year to fully offset the capital losses, the residual capital losses can either be carried back up to 3 years via a T1-ADJ for a prior tax year, or carried forward indefinitely until used up.

Regarding post #22 ,to the extent there were capital sales from re-balancing of mutual funds and they are taxable events, the mutual fund company will send a T5008 recording those transactions to the taxpayer for input on Schedule 3. If there is no such T5008, then Eclectic12 likely has it correct, i.e. they are Corporate Class funds in which transactions under that umbrella are not taxable events.

Added: There is a lot information on the net as regards capital gains and capital losses. Some of it can be confusing including CRA's own capital gains guide. I have heard that some of the most useful and concise information available on capital gains/losses is actually at www.adjustedcostbase.ca That site also has a software package for anyone to use to keep track of their ACB data if they don't want to create and maintain their own spreadsheets.


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## Tostig (Nov 18, 2020)

AltaRed said:


> ...
> 
> The T5008 tax slip has no further use to the taxpayer. The taxpayer provides all his/her acquisition and sales data of securities on Schedule 3. Taxpayers often aggregate data for inputting to Schedule 3. It only matters that the correct data is used to properly calculate capital gains and/or capital losses and what is used to calculate taxes. The tax software actually aggregates all this in the file sent to CRA electronically via NETFILE. That data file is essentially non-recognizable to the taxpayer.
> ...


If only CRA would explain it like this on their website, especially the part that says "The T5008 tax slip has no further use to the taxpayer."


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## Eclectic12 (Oct 20, 2010)

AltaRed said:


> Seems to be somewhat confusing information being passed around here. The data on the T5008 is what the issuing financial institution sends to CRA regarding a taxpayer's purchase and sale of securities. It will list every single transaction, for example, partial fills on the same trading day. The T5008 slip with all the data is sent to the taxpayer so the taxpayer knows what has been sent to CRA ...


Slight wrinkle ... anytime I have autofilled or downloaded the T5008 from CRA, it has always been individual slips.

The broker may or may not be aggregating what the investor downloads from their or receives in the mail.




AltaRed said:


> The T5008 tax slip has no further use to the taxpayer. The taxpayer provides all his/her acquisition and sales data of securities on Schedule 3. Taxpayers often aggregate data for inputting to Schedule 3.


That's what I take away from the info on the T5008 web page that directs individuals to use Schedule 3.
IMO, it would be clearer for the web page to explicitly say to skip the T5008.

Regardless, my tax returns have only included the Schedule 3 entries and have skipped the T5008.


Cheers


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## AMABILE (Apr 3, 2009)

My T5008 from BMO was spot on with the buy and sell amounts

my only beef - terrible format and tiny small print


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## AMABILE (Apr 3, 2009)

sorry - duplicate


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## Manestream (Dec 3, 2020)

I hold shares in taxable accounts at both TD and CIBC. Often these are shares of the same entity. For Canadian tax purposes cost basis must be computed on a weighted average basis. Since shares of say, ENB bought in my account at TD will likely have a different cost than shares of ENB bought in my account at CIBC, you need to aggregate the total cost of all shares owned in taxable accounts and then divide by the total number of shares owned in those accounts to get the true cost basis per share for purposes of determining your capital gain or loss on sale. As a result, the T5008 from TD or CIBC on a sale of shares of ENB will never show the correct cost basis. I have always ignored the cost information on this form when preparing my Schedule 3. I always confirm the proceeds however (which have never been incorrect) and use the form as a double check to ensure that I have accounted for all sales in the year. I have also never been questioned on my cost basis by CRA.

With respect to the question concerning share for share buy outs, these may or may not be rollover transactions for tax purposes. For example, the 2020 share for share buyout of Power Financial for shares of Power Corp is not a tax free transaction unless you file the appropriate Section 85 rollover form. Stock splits will generally be tax deferred (with a corresponding per share tax basis adjustment) and share distributions i.e. spin-offs like Abbott Labs did with Abbvie several years ago, can also be tax free transactions (with corresponding per share tax basis adjustments) but have certain filing requirements and must meet CRA rules.


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