# Anyone does their tax by themselves?



## SkyFall

What software are you using? TurboTax? How is it when trading is involve? Should I just go see an accountant?


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## Jungle

Studiotax. It's free. Then I check with ufile, but I don't pay for it, just trial to ensure both are the same return. 

Your broker will mail you tax slips for income, if you invested in a non-reg. T3 and or T5. Just put them in the right wizard prompts. Pretty easy. 
Also report capital gains and losses, most likely you have to figure this out, just follow the section that asks you for the info.


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## Charlie

I like ufile too. I do pay....at $15 for an individual and $25 for a family I think it's a good deal.

...DIY all depends how comfortable you are with reporting your trading. (it shouldn't be difficult).


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## My Own Advisor

Do my own taxes every year. The only way to learn. Have used a variety of software. 

Later this month, I'll be giving away some free tax software on my site, courtesy of H&R Block.


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## doctrine

Most people can file their personal taxes on their own. It's not that hard. Ditto for Jungle's endorsement of Studiotax. I've been using it for several years now.


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## GoldStone

doctrine said:


> Ditto for Jungle's endorsement of Studiotax.


Tritto for StudioTax. :encouragement:

I cross-check StudioTax return vs. TaxFreeway return, to make sure the numbers match.


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## mrPPincer

I sit down with a pencil and an eraser every time, usually missing something or other but it's a good mental exercise for me and it helps to keep on top of the latest changes.

That said, I do tend to leave it too long, once I sat down and did 8 years worth, this year I'll be doing 2011 and 2012 at the same time; I do not recommend doing it that way :stupid:


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## SkyFall

Well I don't have complicated taxes... I had a part-time job as a student, I did 2-3 trades in my RBC direct Investing Account and 2-3 trades in my TFSA (which I open this year). THe only thing I am scare of is missing on capital gains or loses... Since if T5 is like T4 it's just putting numbers in columns.


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## kcowan

I used TurboTax (and when it was CanTax) for years until they ripped off people doing multiple returns. Switched to Ufile and been using them ever since. Hardest part is keep track of the trading. Operated a sole proprietorship for 15 years. Always did MILs and spouse's taxes too.


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## pwm

I've been using Ufile since 2000 and I love it. This year they sent me a CD in the mail. It costs $20 and I can do 10 returns with it. I got 2 bonus returns for paying/registering B4 march. I file 7 returns each year. That's $2.86 per return. I think it's worth it!


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## Ethan

We've been using Ufile since 2009. Works pretty well.


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## peterk

Always done mine by hand. Probably will for 2012 as well. 2013 might get a bit more complicated with moving expenses and unregistered income/gains and I might switch to software. It's not hard you just need to know how to add subtract and multiply!


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## AltaRed

SkyFall said:


> I did 2-3 trades in my RBC direct Investing Account and 2-3 trades in my TFSA (which I open this year). THe only thing I am scare of is missing on capital gains or loses... Since if T5 is like T4 it's just putting numbers in columns.


You have to input your own capital sales on Schedule 3. There are no T slips produced for these items. It is up to you to keep track of your ACB (purchase price and date purchased) and your sell price/commission/date for each of your investments in a taxable account (but not RRSP or TFSA). Your confirmation slips from your broker will have the 'sales' information, as well as your Annual Trading Summaries. Hint: Keep your Annual Trading Summaries in your files forever.


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## james4beach

I use FutureTax and it's great ($6 for one return). What I love is that it doesn't use all these "wizards" that the other software is obsessed with... it matches the paper process quite closely. So for someone who is used to doing paper returns, it's an easy move to FutureTax. As you fill in the data you can see what the paper return looks like. At the end I always print off the full paper version to keep in my files, too.


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## Eclectic12

SkyFall said:


> Well I don't have complicated taxes... I had a part-time job as a student, I did 2-3 trades in my RBC direct Investing Account and 2-3 trades in my TFSA (which I open this year). THe only thing I am scare of is missing on capital gains or loses... Since if T5 is like T4 it's just putting numbers in columns.


With only 2-3 trades, it should not be difficult. 

Note that since the TFSA is tax free, trades or cash payments and capital gains/losses for investments in the TFSA are good for you to know but are not reported on a tax return.

Here's a list of the tax forms I get from my broker:

1) T5 forms - these are the dividends paid. Most tax software makes it easy to match the box number & put in the amount.

2) T3 forms - these are for investments that pay more than just dividends like a REIT or MF that pays return of capital (RoC). Same thing for matching up boxes, though you will have to take care of any RoC payments.

3) Yearly trading summary - this lists all the buy, sell and commissions for the year. If your buy and sell trades for the stock were all in 2012, this may be all you need. If you bought some or all in an earlier year, the buy info won't be completely on the 2012 trading summary.

4) Yearly investment income summary - this lists all income from dividends. (I use it to check the totals on the T5's.)


You can also check your monthly statements for the year to build a list of what was sold in your taxable account (i.e. not RRSP and not TFSA). 
Then determine your adjusted cost base (ACB) for the number of shares sold, the proceeds and any commission paid. Enter these on Schedule 4, section 3 and the software should take care of calculating the capital gain/loss.

Here's a couple of links to help understand the taxes on capital gains and dividends:
http://www.milliondollarjourney.com/how-investing-taxes-work-part-2-dividends-and-interest.htm
http://www.milliondollarjourney.com/how-investing-taxes-work-part-1.htm
http://www.milliondollarjourney.com/calculating-your-adjusted-cost-base-acb.htm <<-- be aware that this article assumes that is no RoC being paid!


Also - if you make sure the stock, MFs or ETFs you own only pay dividends, you will know that the more complicated RoC calculations won't be needed. 


Cheers


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## Money4life

Since this thread is about doing taxes by themselves, I'll throw this question here instead of making a new thread.

I want to be able to file my taxes on my own (haven't done so before) and I've been trying to figure out the math. I'm looking over my previous year's tax summary courtesy of H&R block and some of the numbers don't add up to me. 

#1) For line 335, it says you are supposed to add up lines 330 to 332. But it looks like lines 300, 308, 312, 363 and 364 were added. I don't understand why 363 and 364 were included.
#2) My taxable income for 2011 was $38,270. For my tax on taxable income - Line C, the amount of $5,740 appears. Does this mean that I was taxed by 6.6%? Since I remained on the 2nd tax bracket (largely due to incompetence), shouldn't I have been taxed by 9.15%? It looks like I missed the first tax bracket by $496.87!

Once I get answers for these, I'll see how much further I can figure out in how to do a proper return. Thanks!


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## SkyFall

Thanks guys, I recorded all my trades on an Excel so I will be good hehehhe!


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## Eclectic12

Money4life said:


> ... I want to be able to file my taxes on my own (haven't done so before) and I've been trying to figure out the math. I'm looking over my previous year's tax summary courtesy of H&R block and some of the numbers don't add up to me.
> 
> #1) For line 335, it says you are supposed to add up lines 330 to 332. But it looks like lines 300, 308, 312, 363 and 364 were added. I don't understand why 363 and 364 were included.


Hmmmm ... I don't see a 335 on the T1 form but do see one on Schedule 1. So assuming it is schedule 1, the link from CRA for schedule 1 says "Add lines 1 to 26". Since 363 is line 12 and 364 is line 13 - the simple answer is CRA told me to.

Line 363 is a tax credit for a maximum amount of $1095:
http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/ddctns/lns360-390/363-eng.html

Line 364 is a tax credit for using public transit.
http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/ddctns/lns360-390/364/menu-eng.html


Is there some reason you don't want all the tax credits that are available to you? All of these line numbers seem to be from Schedule 1, step 1 that is calculating the Federal non-redundable tax credits.




Money4life said:


> #2) My taxable income for 2011 was $38,270. For my net federal tax (tax on taxable income), the amount of $5,740 appears ....


The $38,270 taxable income - is this T1 form, line 260? Is the $5,740 T1 form, line 420?

I just want to be sure we're talking apples to apples ....

Though it might work better for you if you go to the library and borrow a tax book then work you way through the entire form. When you have questions about the line numbers, a good tax book should have the explanation. 

Or here is a link to a spreasheet you can download and use in parallel with tax book.
http://www.peeltech.ca/mytax.shtml


Cheers


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## Eclectic12

SkyFall said:


> Thanks guys, I recorded all my trades on an Excel so I will be good hehehhe!


If you have the trade info in Excel and there's nothing strange like RoC, the calculations should be simple math and easy.

Based on how I tripped myself up, keep in mind on schedule 3, number 3, column 3 which is labelled "Adjusted Cost Base" - there can be some confusion. 

Most financial writers and web sites refer to adjusted cost base (ACB) as calculated per share. 

Schedule 3 labels it ACB but really means ACB per share x the number sold.


For example, buy 200 shares at $10 (I'm ignoring commissions to keep the example simple). Then sell 100 shares at $15.

The ACB as usually used (i.e. per share) is 200 /10 = $20 per share.

The ACB schedule 3 wants it the total which is 100 x 20 = $2000.

It was easy to fix the problem when I figured out that I'd put in an ACB of $20 instead of the correct number of $2000.


Cheers


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## Money4life

Hi Eclectic12,

I'm just going by the "tax return summary" that H&R Block provided to me. You're right, I'm probably going to have to get a proper reading instead of following this.

Correct, everything from lines 300 to 335 is from Step 1 - Federal non-refundable tax credits. This "federal return" that H&R Block gave to me doesn't seem to separate the Schedules from the T1 Form so this must be why that these interchanging lines are confusing me. Yes, I do want all of the tax credits that are available to me, just wanted to figure out how they came up with these numbers.

Yes, the $38,270 taxable income is from T1 form, line 260. The $5740 is from Step 3 - Net Federal Tax, Line C - Tax on Taxable Income (which is don't even see now that I've opened up the Schedule 1 PDF myself). Regardless, Line C has the same amount as Line 404 on Step 3 in Schedule 1. 

I think I'm going to start following the actual T1 Form/Schedules going forward instead of relying on some crummy "Federal Return Summary" from H&R Block. 

Once I start from scratch and try to piece things together, I'll return to ask questions if need be. Sorry for having you to go through this, Eclectic12.

EDIT: I'm working an overnight shift tonight. I'm going to spend my time reading over the General Income Tax and Benefit Guide and see what I can get from that.

http://www.cra-arc.gc.ca/E/pub/tg/5000-g/5000g-12e.pdf

Should make the overnight shift fly by!


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## kcowan

Money4life
I really encourage you to get a copy of tax software. It will make the process so much simpler and will increase your understanding of how taxes work.
Keith


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## Clacker

I usually use Taxfreeway, but I double check with studiotax. I've also used ufile a long time ago when I was a student and it was free. All are good choices.


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## sharbit

Money4life said:


> I want to be able to file my taxes on my own (haven't done so before) and I've been trying to figure out the math. I'm looking over my previous year's tax summary courtesy of H&R block and some of the numbers don't add up to me.


There's a book "Byrd & Chen's Canadian Tax Principles" that you can pick up if you want to know how things work in reasonable detail.

I use Profile for personal and corporate with OnePay. I think its like 25 for a T1 and 200 for a T2.


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## Money4life

Thanks for the recommendations, kcowan and sharbit.

In the meantime, I've been reading the General Income Tax and Benefit Guide and have some questions/thoughts:

1) Line 121 - Interest and Other Investment Income: For bank accounts, it asks you to report any interest paid or credited to you in 2012, even if you did not receive an information slip. As far as I've known, I've never reported income from my bank accounts (Line 121 has always been blank) and during the last three years, H&R Block didn't ask or report this information from me. I'll double-check my T5 slips.

2) Line 127 - Taxable Capital Gains: It asks you to report a capital gain or loss from selling or redeeming a mutual fund. Again, no amount was reported on Line 127 by H&R Block on my behalf and I've had Mutual Funds in non-registered accounts for the last three years. Will double-check my T3 and T5 slips.

3) Line 208 - RRSP Deduction: It says that if you have unused RRSP contributions from tax year 2011, you should have filed a completed Schedule 7 during that tax year. It you didn't, it asks you to submit your receipts and a submitted copy of a 2011 Schedule to your tax centre but to not include them with your return for 2012. But if you made unused contributions from 1991 to 2011 and did not show it on a Schedule 7 for 2010 or earlier, you have to contact CRA. What's confusing is that on the Schedule 7 Form, it doesn't mention these conditions and simply states to insert amount B from your 2012 Notice of Assessment onto Line 1 and just continue on from there.

Overall, it seems like the H&R Block representatives are more concerned about serving as many customers as possible as opposed to trying to find every deduction based on your needs. It appears that you can get a tax deduction on just about anything but with much stipulation that has to fall into place. The General Income Tax and Benefit Guide is an extremely thorough document.


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## Homerhomer

Money4life said:


> Thanks for the recommendations, kcowan and sharbit.
> 
> In the meantime, I've been reading the General Income Tax and Benefit Guide and have some questions/thoughts:
> 
> 1) Line 121 - Interest and Other Investment Income: For bank accounts, it asks you to report any interest paid or credited to you in 2012, even if you did not receive an information slip. As far as I've known, I've never reported income from my bank accounts (Line 121 has always been blank) and during the last three years, H&R Block didn't ask or report this information from me. I'll double-check my T5 slips.
> 
> 2) Line 127 - Taxable Capital Gains: It asks you to report a capital gain or loss from selling or redeeming a mutual fund. Again, no amount was reported on Line 127 by H&R Block on my behalf and I've had Mutual Funds in non-registered accounts for the last three years. Will double-check my T3 and T5 slips.
> 
> 3) Line 208 - RRSP Deduction: It says that if you have unused RRSP contributions from tax year 2011, you should have filed a completed Schedule 7 during that tax year. It you didn't, it asks you to submit your receipts and a submitted copy of a 2011 Schedule to your tax centre but to not include them with your return for 2012. But if you made unused contributions from 1991 to 2011 and did not show it on a Schedule 7 for 2010 or earlier, you have to contact CRA. What's confusing is that on the Schedule 7 Form, it doesn't mention these conditions and simply states to insert amount B from your 2012 Notice of Assessment onto Line 1 and just continue on from there.
> 
> Overall, it seems like the H&R Block representatives are more concerned about serving as many customers as possible as opposed to trying to find every deduction based on your needs. It appears that you can get a tax deduction on just about anything but with much stipulation that has to fall into place. The General Income Tax and Benefit Guide is an extremely thorough document.


1) Banks often don't issue T5 slips for interest if it's below $50, however that doesn't mean that the interest shouldn't be reported, but if the slips are not issued CRA has no knowledge of interest being earned, with T5 they do.

2) T3 and T5 slips do not deal with the securities you sold, they only report income earned inside mutual fund (T3), and income earned in your brokerage account (t5), gains/losses on actual sales are your responsibility.

3) You just need to match the rrsp room with the notice of assessment, if it doesn't there is a mistake, either yours or cra, most likely yours.

4) Yes, H&R block is concerned with their profit, and no you can't get a deduction for just about anything ;-)


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## Eclectic12

Money4life said:


> ... In the meantime, I've been reading the General Income Tax and Benefit Guide and have some questions/thoughts:
> 
> 1) Line 121 - Interest and Other Investment Income: For bank accounts, it asks you to report any interest paid or credited to you in 2012, even if you did not receive an information slip. As far as I've known, I've never reported income from my bank accounts (Line 121 has always been blank) and during the last three years, H&R Block didn't ask or report this information from me. I'll double-check my T5 slips....


The bank only reports if there's over a certain amount and then you'll get a T5. If it's less than the minimum amount, it's up to you the tax payer to report whatever the interest was. That's why I match up my bank accounts to the T5 forms so that I know which accounts to check for the small interest amounts.




Money4life said:


> ... 2) Line 127 - Taxable Capital Gains: It asks you to report a capital gain or loss from selling or redeeming a mutual fund. Again, no amount was reported on Line 127 by H&R Block on my behalf and I've had Mutual Funds in non-registered accounts for the last three years. Will double-check my T3 and T5 slips....


This may not be an issue ... did you sell or redeem a MF? 

If not, likely the T3 and T5 forms have covered everything. 

Since you say you are getting T3 forms, likely some of the cash payments are return of capital (RoC) which you will need to be subtracting from the cost of the investment (i.e. ACB).

http://www.taxtips.ca/personaltax/investing/taxtreatment/mutualfunds.htm
http://www.cra-arc.gc.ca/E/pub/tg/rc4169/rc4169-e.html
http://howtoinvestonline.blogspot.ca/2010/07/return-of-capital-separating-good-from.html




Money4life said:


> 3) Line 208 - RRSP Deduction: It says that if you have unused RRSP contributions from tax year 2011, you should have filed a completed Schedule 7 during that tax year. It you didn't, it asks you to submit your receipts and a submitted copy of a 2011 Schedule to your tax centre but to not include them with your return for 2012. But if you made unused contributions from 1991 to 2011 and did not show it on a Schedule 7 for 2010 or earlier, you have to contact CRA. What's confusing is that on the Schedule 7 Form, it doesn't mention these conditions and simply states to insert amount B from your 2012 Notice of Assessment onto Line 1 and just continue on from there...


The form itself is written up to cover the common process, which is to file schedule 7 for the tax year there are ununsed RRSP contributions. Not everyone does so that's why there's a separate guide and lots of articles and books to expand beyond the limited space on the form.

For example, if $5K was contributed to an RRSP in 2011 but only $3K was deducted from income, schedule 7 would have been filled out for the 2011 tax return. I suppose one could have included the receipt and put the deduction on the T1 form, line 208 without filling out schedule 7, which might end up in the situation being described.


Cheers


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## kcowan

I have concluded after many years of tax filings that the capital gains are an honour system. It is difficult for me to figure them out. It would be even more difficult for my investco to figure them out (beyond the annual trading summary) and so it is impossible for the CRA to know. They can approximate so you better be close. But in this case, close is good enough.


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## Robillard

Like peterk, I also do my taxes by hand. I have been completing the paper returns and doing the calculations with a calculator, with a little assistance from my computer. I created an Excel spreadsheet that performs the calculations that would be required. In the past three years, the CRA hasn't amended or reassessed my returns, so I'm confident that I'm getting it right.


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## Eclectic12

kcowan said:


> I have concluded after many years of tax filings that the capital gains are an honour system. It is difficult for me to figure them out. It would be even more difficult for my investco to figure them out (beyond the annual trading summary) and so it is impossible for the CRA to know. They can approximate so you better be close. But in this case, close is good enough.


I can see where it was the honour system but the more computing power gets cheaper, I suspect CRA will require more reporting by the investco to them and over time, the closer (if not dead on) they will get.

As I recall, the first trusts I bought used to have pretty light reporting and now there's T3 forms and reports from the investco breaking down each payment.




Robillard said:


> Like peterk, I also do my taxes by hand. I have been completing the paper returns and doing the calculations with a calculator, with a little assistance from my computer. I created an Excel spreadsheet that performs the calculations that would be required. In the past three years, the CRA hasn't amended or reassessed my returns, so I'm confident that I'm getting it right.


Out of curiosity - if you are using a spreadsheet already for calculations, why not use the spreadsheet at this link:
http://www.peeltech.ca/mytax.shtml

It does the calculations and you can print the tax forms to submit a paper copy to the CRA directly from the spreadsheet. 


Cheers


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## Money4life

Thanks for your responses.

I was wrong. *Line 121* - 'Interest and other investment income', has been reported on my last two returns. For Tax Year 2011, *$6.80* was reported for 'Foreign Non-Bus. Income'. It appears that *$6.80* was dividends from foreign income. For Tax Year 2010, *Line 121* has an amount of *$101.62*. This amount of money was from 'Interest From Canadian Sources'. It looks like I had *$1.27* of 'Foreign Non-Bus. Income' in this same year too. Wonder why that wasn't reported. I got T3 slips for both 2010 and 2011 but for some reason, I didn't get a T5 Slip for 2011, just 2010. So I guess that definitely means that my bank account interest wasn't reported to them in that year, nor my 'Interest from Canadian Sources'. 

Also reported during my past two years were amounts on *Line 130 *- 'Other Income'. *$176.55* in 2011 and *$87.69* for 2010, both straight forward and just taken from the Other Income, *Box 26* on my T3 slips. It looks like I had payments from a Trust, not even sure what payments those would be. Also, reported in 2011 on *Line 120* - 'Taxable amount of dividends from taxable Canadian corporation' was an amount of *$59.02*. This was entered on my return but it looks like I also had a 'Dividend Tax Credit for Eligible Dividends' in *Box 51* of my T3 slip for an amount of *$9.70*. Where can I see if this amount was reported on my return? As far as I can tell, I'm not seeing it.

For *Line 127* - Taxable Capital Gains: I have confirmed from past T3 slips that all boxes in *Line 21* - 'Capital Gains' have been blank. In Tax Year 2011, I did not sell or redeem mutual funds. I did a lot of transferring/exchanging of Funds but not actual redemptions. However, according to the CRA website, in the Carryover Amounts section, I have a net investment gain/loss of *$188* in 2010 and another net investment gain/loss of *$241* in 2011. I don't think these have been deducted anywhere yet. Where would I check to see and if they haven't been deducted yet, where would I do this on my 2012 return? I'm guessing I'd have to fill out and attach a Schedule 3 form to my return? I most definitely sold some Mutual Funds in 2012 from unregistered accounts. Unfortunately, since I got rid of these accounts, I am unable to look up the past activity online. I may have to visit the local branch if I am not provided all of the proper information when my slips come in for Tax Year 2012. We'll see.

For* Line 330*, Medical Expenses: For the last two tax years, I've had amounts reported for this by H&R Block and I'm not sure why. Is there a way I can see where these amounts came from? I see that this information isn't on my T4 slip. Any payments made to a dentist or doctor, for example, were covered by my work benefits.

Where does it show on a tax return that a tax credit was received for rental expenses in a year? My fiance who had a total income of *$37,000* submitted a rent receipt for tax year 2011. I want to make sure that this was properly claimed. 

Those are all of my questions for now. Thanks!


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## AltaRed

I suggest you find a good friend to help you with your 2012 tax return this year, so that you can understand the inputs and why. As of the current time, you have a high risk of making mistakes that will have to be 'unwound' later this year or next. A few responses to your detailed post.

When you own mutual funds, these are called 'trusts' and therefore T3 slips are issued. T3 slips can contain 'foreign non-business income' if the fund you owned contained investments ex-Canada in the fund that provided income within the fund. To the extent, it seems $1.27 was not reported, that was an error of H&R block. To the extent you did not get a T5, perhaps you did not have investments that generated 'interest from Canadian sources'. Unless we know what mutual funds and/or bank interest accounts you owned in which years, we cannot opine on why you did not get a T5 one year.

The Dividend tax credit will show up in your Schedule 1 (and provincial tax calculations) where tax is calculated and tax credits are subtacted from tax owing.

On Capital Gains, it is not clear to me what you mean by transferring or exchanging of funds. That could mean that if you just exchanged mutual funds within the same Corporate class of a mutual fund family, or there was a swap in Series of a mutual fund family there is no tax triggering event. But if outside those specific criteria, swaps/transfers are considerd sells/buys, i.e. redeeming one and buying another. Without us knowing what you swapped/transferred to what, we cannot opine on that either. Given the CRA website says that you had investment gains/losses for 2010 and 2011 and there are Carryforwards, then in fact, you did have capital losses (meaning you sold something at a loss in both years.). What does the bottom of Schedule 3 have/say for each of those 2 years? The Carryforward (loss) can be used in future years to offset Capital Gains from investments you may sell in the future. You cannot use it as a deduction in any other way.

You will not receive tax slips for any investments sold. But you should get a statement from the bank saying what was bought and sold in 2012 and for how much. It is up to you to then determine how much of a Capital Gain or Capital Loss you have from each of the investments sold. To do that, you have to know how much you paid for each investment originally including any dividend re-investments that may have occured since date of purchase (to get your ACB or adjusted cost base). The difference between you ACB and your Sell price is your Capital Gain or Capital Loss. You have to do this individually for each mutual fund sold. And yes, that is done on Schedule 3. Note: If at the bottom of Schedule 3 you end up in a Capital Gain, you can use some (or all) of the Carryforward amounts from past years that you can to possibly reduce that Capital Gain to zero (but not negative). To the extent at the bottom of Schedule 3, you have a Capital Loss, that becomes additional Carryforward amounts to be used in future years.

If you need more help, you will need to provide the names of the mutual funds bought and sold over the past 3 years for us to better understand the T3/T5 issues and your Carry Forward amounts.


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## Money4life

Hi AltaRed,

Thanks for the thorough response. For the longest time, I only had TD Investor Series Mutual Funds and during 2011, I made some swaps and switched to different TD Investor Series Mutual Funds. I was very indecisive with the funds and my investment advisor took advantage of that. Would that technically count as a sell and purchase even though I switched within the same series of funds? 

I do have a lot of documentation here and will probably be able to provide all of the mutual funds bought and sold over the past three years, including how much I paid for each investment. A list of dividends re-invested might be trickier because as I said earlier, I closed my non-registered accounts and don't have online access to them anymore. Might have to visit a TD branch to get that but perhaps the quarterly reports that I have in storage will provide that info.

I have to leave to take care of some errands but will follow up later with more info. 

Much appreciated. Thanks.


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## AltaRed

Money4life said:


> For the longest time, I only had TD Investor Series Mutual Funds and during 2011, I made some swaps and switched to different TD Investor Series Mutual Funds. I was very indecisive with the funds and my investment advisor took advantage of that. Would that technically count as a sell and purchase even though I switched within the same series of funds?


Most likely. Seems you might have done something in 2010 as well to create the CRA investment/loss Carry forward. Look within the Schedule 3 of your 2010 and 2011 tax returns. I suspect you will see that H&R Block may have recorded buy/sells there to create those CRA amounts at the bottom of Schedule 3.



> I do have a lot of documentation here and will probably be able to provide all of the mutual funds bought and sold over the past three years, including how much I paid for each investment. A list of dividends re-invested might be trickier because as I said earlier, I closed my non-registered accounts and don't have online access to them anymore. Might have to visit a TD branch to get that but perhaps the quarterly reports that I have in storage will provide that info.


The quarterlies should provide that information. As will the Annual statement of Income/Expenses and/or Trading Summary that I believe even the Banks are supposed to provide (but might not - not familiar with bank branch investing).

I am also curious about that T5 in 2010 versus none in 2011. Either you had GICs, term deposits, or an interest bearing account that provided income in 2010, but not in 2011. Did you use your savings sometime in 2010 to make your mutual fund purchases?


Off tangent and not related to taxation, but a pet peeve of mine is that most, if not, all bank financial representatives should be prohibited from using the title Advisor. That implies credentials well beyond what most bank branch financial representatives have. That goes for full service brokers as well. Most of those folks are incentivized salespersons with no fudiciary obligation to the client. The Advisor title should be reserved for those with a fudiciary obligation to the client.


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## Pennypincher

I use a macbook at home and have used a tax program called Taxfreeway for a few years now. It's around $15 and you can do about 10-15 tax returns with it. It works well enough.

I used to do a lot of friends and family's tax returns. Now I just share the tax program and force them to learn on their own. It's good to be able to manage your own taxes. Now they only bug me each year for the access code to Taxfreeway as they can't wait to get started on getting their refunds.


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## Money4life

Um...I don't see a Schedule 3 section in either my 2010 or 2011 returns. It looks like the only schedules completed in 2010 were 1 and 11 and in 2011, Schedules 1, 7 and 13. In 2010 and 2011, there were no changes to my accounts aside from mutual fund swapping. I've never had a GIC or term deposit. As of 2011, aside from the mutual funds, I've only had a cheuqing and savings account. The Mutual Fund purchases were all done from my cheuqing account. 

Let's get down to my MF history. I'm going to assume that you will only want my non-registered mutual funds history and not my TFSA or RRSP info, so here it is:

November 18, 2010: Purchased *$14,038.65* into TD Canadian Equity Fund. 
https://www.tdassetmanagement.com/Download/TDB161E.pdf
_Unit Price: *$27.91*_, _Transaction Units/Total Units Held: *502.997*_

November 18, 2010: Purchased *$4,000.00* into TD Canadian Bond Fund. 
https://www.tdassetmanagement.com/Download/TDB162E.pdf
_Unit Price: *$13.59*, Transaction Units/Total Units Held: *294.334*_

November 18, 2010: Purchased *$7,486.17* into TD Canadian Bond Fund. (No idea why I did two separate purchases in the same day into the same fund. Only explanation is the "advisor" told me to put more money into it after my initial purchase).
_Unit Price: *$13.59*, Transaction Units/Total Units Held: *845.193*_

February 7, 2011: Took TD Canadian Equity Fund and *transferred out* *$15,074.82* to TD Entertainment & Communications Fund. https://www.tdassetmanagement.com/Download/TDB652E.pdf
TD Canadian Equity Fund *transfer out* details: _Unit Price: *$29.97*, Transaction Units: *502.997*, Total Units Held: *0*_
TD Entertainment & Communications Fund *transfer in* details: _Unit Price: *$25.24*, Transaction Units/Total Units Held: *$597.259*_

February 7, 2011: Took TD Canadian Bond Fund and *transferred out* *$6,120* to TD Entertainment & Communications Fund.
TD Canadian Bond Fund *transfer out* details: _Unit Price: *$13.41*, Transaction Units: *456.376*, Total Units Held: *395.412*_
TD Entertainment & Communications Fund *transfer in* details: _Unit Price: *$25.24*, Transaction Units: *242.472*, Total Units Held: *839.731*_

August 8, 2011: Took TD Entertainment & Communications Fund and *transferred out* *$7,000* to TD Dividend Growth Fund.
https://www.tdassetmanagement.com/Download/TDB972E.pdf
TD Dividend Growth Fund *transfer in* details: _Unit Price: *$48.85*, Transaction Units/Total Units Held: *143.296*_
TD Entertainment & Communications Fund *transfer out* details: _Unit Price: *$21.99*, Transaction Units: *318.327*, Total Units Held: *$521.404*_

August 8, 2011: Took TD Entertainment & Communications Fund and *transferred out* *$6,500* to TD Precious Metals Fund
https://www.tdassetmanagement.com/Download/TDB648E.pdf
TD Precious Metals Fund *transfer in* details: _Unit Price: *69.04*, Transactions Units/Total Units Held: *94.148*_
TD Entertainment & Communications Fund *transfer out* details: _Unit Price: *$21.99*, Transaction Units: *295.589*, Total Units Held: *225.815*_

April 3, 2012: Took TD Precious Metals Fund and transferred *$5,136.71* to TD Science & Technology Fund
https://www.tdassetmanagement.com/Download/TDB645E.pdf
TD Science & Technology Fund *transfer in* details: _Unit Price: *$20.71*, Transaction Units/Total Units Held: *248.030*_
TD Precious Metals Fund *transfer out* details: _Unit Price: *$54.56*, Transaction Units: *94.148*, Total Units Held: *0.00*_

April 5, 2012: Started Pre-Authorized Purchase Plans of *$75 each weekly* for TD Canadian Bond Fund, TD Science & Technology Growth, TD Dividend Growth Fund, TD Entertainment & Communications Fund
Unfortunately, I don’t seem to have how much I was buying these for. But I ended these purchases on May 19, 2012, so these consecutive purchases happened for seven weeks.

July 24, 2012: Closed (redeemed) the four accounts above.
TD Canadian Bond Fund: *$6,451.38*, _Unit Price: *$14.42*, Transaction Units: *447.391*, Total Units Held: *0.00*_
TD Science & Technology Fund: *$4,916.50*, _Unit Price: *$18.14*, Transaction Units: *271.031* Total Units Held: *0.00*_
TD Entertainment & Communications Fund: *$6,494.94*, _Unit Price: *$26.77*, Transaction Units: *242.620*, Total Units Held: *0.00*_
TD Dividend Growth Fund: *$8,004.58*, Unit Price: *52.31*, _Transaction Units: *153.022*, Total Units Held: *0.00*_

Then I received an account statement later in the year to confirm closing prices (they are all different than above):

TD Canadian Bond Fund; _Closing Price Per Unit: *$14.32*, Y-T-D Distributions of Interest, Dividends and/or Capital Gains: *$96.22*_
TD Science & Technology Fund: _Closing Price Per Unit: *$19.34*, Y-T-D Distributions of Interest, Dividends and/or Capital Gains: *$0.00*_
TD Entertainment & Communications Fund: _Closing Price Per Unit: *$28.57*, Y-T-D Distribution of Interest, Dividends and/or Capital Gains: *$0.00*_
TD Dividend Growth Fund: _Closing Price Per Unit: *$54.72*, Y-T-D Distributions of Interest, Dividends and/or Capital Gains: *$28.21*_

What a mess! It turns out that I don’t have a list of funds here with me that were re-invested with dividends but it’s safe to say that only the Canadian Bond Fund and the Canadian Dividend Fund had that type of activity. The rest were all sector funds (what a disgrace) except for the Canadian Equity Fund that I had from November 18, 2010 to February 11, 2011. I’m guessing that had dividends being re-invested into the fund. So I need to get a dividend transaction history for these three funds before I can get a proper capital gain or loss reading. Do I need to get the prices for the weekly pre-paid authorizations that I purchased from April 5, 2012 to May 19, 2012? I’m guessing no because I already had the funds purchased in the first place?


Here is an extremely rough summary (my attempt to organize and put the fund’s history together; no prices included here):

TD Canadian Equity Fund: Purchased *$14,038.65* in November 2010, transferred/sold *$15,074.82* to another mutual fund in February 2011. 

TD Canadian Bond Fund: Purchased *$4,000.00* in November 2010, purchased another *$7,486.17* in November 2010, sold/transferred *$6,120* to another fund in February 2011, purchased *$75 per week for 7 weeks* in April 2012, sold/redeemed *$6451.38* in July 2012. 

TD Entertainment & Communications Fund: Purchased *$15,074.82* in February 2011, Purchased another *$6,120* in February 2011, sold/transferred *$7,000* to another fund in August 2011, sold/transferred *$6,500* to another fund in August 2011, purchased *$75 per week for 7 weeks* in April 2012, sold/redeemed *$6,494.94* in July 2012.

TD Precious Metals Fund: Purchased *$6,500* in August 2011, sold/transferred *$5,136.71* (entire market value) to another fund in April 2012. 

TD Dividend Growth Fund: Purchased *$7,000* in August 2011, purchased *$75 per week for 7 weeks* in April 2012, sold/redeemed *$8,004.58* in July 2012.

TD Science & Technology Fund: Purchased *$5,136.71* in April 2012, purchased *$75 per week for 7 weeks* in April 2012, sold/redeemed *$4,916.50* in July 2012.


Even though I don’t have all of my dividend information yet, let me attempt to do the math. I assume I have to calculate the gains/losses from January to December and not March to February? I’m going to try to do figure out the capital gain/loss for one fund and then you guys can let me know if I did it right:

TD Canadian Equity Fund: So I only had this fund for little less than three months. Purchased *$14,038.65*, _Unit Price: *$27.91*, Transaction Units/Total Units Held: *502.997*_
Its *transfer out/selling* details: *$15,074.82*, _Unit Price: *$29.97*, Transaction Units: *502.997*, Total Units Held: *0.00*_

I’m a little confused determining the capital gain or loss by just looking at the unit prices and transaction units. Since this Mutual Fund didn’t have a complicated history, can’t I just take the actual totals and find the difference? So this would be a capital gain of *$1,036.17*? And this gain would technically be in 2011 and not 2010, correct? Since this is the total, I would suspect that dividends re-invested were included as well. Unfortunately, the other mutual funds have a more complicated history and will definitely need to use the ACB and selling prices to determine capital gain or loss; again just confused in what to do with the unit prices and transaction units.

Sorry, this was a long post! I’ll be shocked but extremely appreciative if anyone reads this over and provides some help. Unfortunately, I'm going to need help determining capital gains and losses for these mutual funds. This is going to be painful to sort through. :upset:

Thank you so much. :distress:


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## Homerhomer

Money4life said:


> Sorry, this was a long post! I’ll be shocked but extremely appreciative if anyone reads this over and provides some help. Unfortunately, I'm going to need help determining capital gains and losses for these mutual funds. This is going to be painful to sort through. :upset:
> 
> Thank you so much. :distress:


Ok, as you expected I didn't read the whole post, however I don't understand why determining capital gains on mutual funds is such a chore. Didn't mutual fund companies send you capital gains report each year? If you don't know how to determine capital gains yourself than use their report, usually their reporting is actually pretty good.


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## Money4life

Homerhomer said:


> Ok, as you expected I didn't read the whole post, however I don't understand why determining capital gains on mutual funds is such a chore. Didn't mutual fund companies send you capital gains report each year? If you don't know how to determine capital gains yourself than use their report, usually their reporting is actually pretty good.


I've never tried determining capital gains/losses before on my own prior to this. The unit price, transaction units and countless mutual fund switches/transfers that I did makes things more complicated to me. I do have one report that was given to me where I THINK it provided the info for only two of the six mutual funds but even then, the numbers don't seem right to me, seen here:



Money4life said:


> TD Canadian Bond Fund; Closing Price Per Unit: $14.32, Y-T-D Distributions of Interest, Dividends and/or Capital Gains: $96.22
> TD Science & Technology Fund: Closing Price Per Unit: $19.34, Y-T-D Distributions of Interest, Dividends and/or Capital Gains: $0.00
> TD Entertainment & Communications Fund: Closing Price Per Unit: $28.57, Y-T-D Distribution of Interest, Dividends and/or Capital Gains: $0.00
> TD Dividend Growth Fund: Closing Price Per Unit: $54.72, Y-T-D Distributions of Interest, Dividends and/or Capital Gains: $28.21


The other two Mutual Funds that I had aren't provided in this summary because I sold them earlier. If I understood how to properly calculate the capital gains and losses, I would gladly do it. It's not like I know how to do it and am just too lazy to do it. If that were the case, then yes your comparison of me treating this as a chore would be accurate. I simply need a step in the right direction and then I'll be able to handle it on my own.


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## Spudd

If we take your TD Canadian Equity Fund as an example:
Purchase: Unit Price: $27.91, Transaction Units/Total Units Held: 502.997
Sale: Unit Price: $29.97, Transaction Units: 502.997

This is a simple one because you sold ALL your units when you sold. Your original cost was $14,038.65 and you sold it for $15,074.82, so your capital gains was $15,074.82-$14,038.65 = $1,036.17

The bond fund is a bit more complicated because you kept part of it. Let's do it as our second example. Although you bought it in 2 chunks, the price was the same for each chunk, so you can calculate the cost by taking $13.59 times the number of units. 
Unit Price: $13.59, Transaction Units/Total Units Held: 845.193

Then you sold some:
Unit Price: $13.41, Transaction Units: 456.376, Total Units Held: 395.412
The money you got for selling this was $13.41*456.376 = $6120.00. The money you used to buy it originally was $13.59*456.376 = $6202.15. So you had a capital loss in this case of $82.15. 

The cost of the bond fund units you were still holding is still the same, $13.59 per unit, and you have 395.412 left. 

You need to basically just keep repeating this process throughout all of those various transactions. It will be time consuming but it should be possible. I recommend using a spreadsheet to make it simpler. 

For the pre-authorized purchase plan you'll need to find out how much you paid per unit, and how many units you got, for each of those individual transactions. Since this took place in 2012, your bank should be able to provide this information if you don't have it.


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## Money4life

Spudd said:


> If we take your TD Canadian Equity Fund as an example:
> Purchase: Unit Price: $27.91, Transaction Units/Total Units Held: 502.997
> Sale: Unit Price: $29.97, Transaction Units: 502.997
> 
> This is a simple one because you sold ALL your units when you sold. Your original cost was $14,038.65 and you sold it for $15,074.82, so your capital gains was $15,074.82-$14,038.65 = $1,036.17
> 
> The bond fund is a bit more complicated because you kept part of it. Let's do it as our second example. Although you bought it in 2 chunks, the price was the same for each chunk, so you can calculate the cost by taking $13.59 times the number of units.
> Unit Price: $13.59, Transaction Units/Total Units Held: 845.193
> 
> Then you sold some:
> Unit Price: $13.41, Transaction Units: 456.376, Total Units Held: 395.412
> The money you got for selling this was $13.41*456.376 = $6120.00. The money you used to buy it originally was $13.59*456.376 = $6202.15. So you had a capital loss in this case of $82.15.
> 
> The cost of the bond fund units you were still holding is still the same, $13.59 per unit, and you have 395.412 left.
> 
> You need to basically just keep repeating this process throughout all of those various transactions. It will be time consuming but it should be possible. I recommend using a spreadsheet to make it simpler.
> 
> For the pre-authorized purchase plan you'll need to find out how much you paid per unit, and how many units you got, for each of those individual transactions. Since this took place in 2012, your bank should be able to provide this information if you don't have it.


This is exactly the kind of post I was looking for. Thanks Spudd.

I will use your examples and try to figure out the rest of my own. Yes, I will probably need to go to the bank first to find out more information about those pre-authorized purchases. Since I closed those accounts, I no longer have online access.

Thanks again!


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## AltaRed

Money4life said:


> Um...I don't see a Schedule 3 section in either my 2010 or 2011 returns. It looks like the only schedules completed in 2010 were 1 and 11 and in 2011, Schedules 1, 7 and 13. In 2010 and 2011, there were no changes to my accounts aside from mutual fund swapping. I've never had a GIC or term deposit. As of 2011, aside from the mutual funds, I've only had a cheuqing and savings account. The Mutual Fund purchases were all done from my cheuqing account.
> 
> Here is an extremely rough summary (my attempt to organize and put the fund’s history together; no prices included here or accurate dividend history):
> 
> TD Canadian Equity Fund: Purchased *$14,038.65* in November 2009, transferred/sold *$15,074.82* to another mutual fund in February *2010. *my bold - above you said 2010 bought and 2011 sold, so I assume this is a typo here?
> 
> TD Canadian Bond Fund: Purchased *$4,000.00* in November 2009, purchased another *$7,486.17* in November 2009, sold/transferred *$6,120* to another fund in February 2011, purchased *$75 per week for 7 weeks* in April 2012, sold/redeemed *$6451.38* in July 2012.
> 
> TD Entertainment & Communications Fund: Purchased *$15,074.82* in February 2010, Purchased another *$6,120* in February 2010, sold/transferred *$7,000* to another fund in August 2011, sold/transferred *$6,500* to another fund in August 2011, purchased *$75 per week for 7 weeks* in April 2012, sold/redeemed *$6,494.94* in July 2012.
> 
> TD Precious Metals Fund: Purchased *$6,500* in August 2011, sold/transferred *$5,136.71* (entire market value) to another fund in April 2012.
> 
> TD Dividend Growth Fund: Purchased *$7,000* in August 2011, purchased *$75 per week for 7 weeks* in April 2012, sold/redeemed *$8,004.58* in July 2012.
> 
> TD Science & Technology Fund: Purchased *$5,136.71* in April 2012, purchased *$75 per week for 7 weeks* in April 2012, sold/redeemed *$4,916.50* in July 2012.
> 
> 
> Even though I don’t have all of my dividend information yet, let me attempt to do the math. I assume I have to calculate the gains/losses from January to December and not March to February? I’m going to try to do figure out the capital gain/loss for one fund and then you guys can let me know if I did it right:
> 
> TD Canadian Equity Fund: So I only had this fund for little less than three months. Purchased *$14,038.65*, _Unit Price: *$27.91*, Transaction Units/Total Units Held: *502.997*_
> Its *transfer out/selling* details: *$15,074.82*, _Unit Price: *$29.97*, Transaction Units: *502.997*, Total Units Held: *0.00*_


That is one hell of a roller coaster there. Never seen anything quite like it, but I will respond selectively to a few things to start with.

Capital gains (or losses) are declared on Schedule 3 of your tax return in the year that it is sold, e.g. Canadian Equity Fund in 2011. (Note that what you refer to as transfers out, are not really transfers out. TD may call them that, but they are actually a fund sale, then a transfer in is a fund purchase. Which means you will have capital gains (or losses) each time you made a sale, and that must be on Schedule 3 of the tax return in the year of the sale. Given that you had fund sales in 2011, there should have been a Schedule 3 filed in 2011. You did not have fund sales in 2010, so no would be no Schedule 3 in 2010. To the extent you did not provide H&R Block with the information for your fund sales in 2011, they would not have known to file a Schedule 3. It seems you should be filing a T1-ADJ on your 2011 tax return to capture this data. http://www.cra-arc.gc.ca/E/pbg/tf/t1-adj/README.html I do not know why CRA has Carry Forwards for investment gains/losses in 2010 and 2011. You may ultimately have to phone them to ask them why they have data for those 2 years (but someone else here with more CRA experience may wish to comment on whether and how to make that call).

Separate from the above, you had distributions (income) from some of these funds in both 2010, 2011 and 2012. That is why you got T3's for each of 2010 and 2011 and you will get another one for 2012. The T5 for 2010 would have been for interest on your savings account. Investment income goes on Schedule 4. If you use tax software, this is where the data from T3s and T5s ends up. Please note: Even if you did not get a T5 for your interest account in 2011, you still should have decalred any interest you earned from your savings account on your 2011 tax return. If you do a T1-ADJ for 2011, you should now declare that interest at the same time (increase of interest income in Schedule 4).

I don't understand your comment about not having dividend information yet (T3 for 2012). That doesn't matter for calculating the capital gains/losses on the sale of your investments in 2012 for Schedule 3. As I said, capital gains/losses on the sale of investments are recorded on Schedule 3 in the year of sale. Dividend information (income) is covered under Investment Income in your tax return on Schedule 4 (and can be 3-4 types of income and does not go in Schedule 3). All income information is calendar year based and that is what the T3 you get will be for.

I am also puzzled by your comment on closing statement received later having different data than the sales data. Where did you get your purchase and sales data from in your post? From account statements? That information should come from monthly or quarterly account statements. I do not know what is meant by the closing statement, unless this is simply a year end statement???

I can understand why your tax returns do not include Schedule 3s if you did not give your tax preparer your buy/sell data for your mutual funds, but I fail to see why there are no Schedule 4's. The tax preparer would have had to input that data if you gave them the T3 and T5 tax slips and it would have ended up on Schedule 4.

P.S. If you want to do your own taxes for 2012, I would suggest you use some tax software such as TurboTax or Ufile or StudioTax. The first two at least have a pretty good interview process to help you plug in numbers. That said, I suggest you focus first sorting out this Capital Gains/Losses stuff.


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## Money4life

AltaRed said:


> my bold - above you said 2010 bought and 2011 sold, so I assume this is a typo here?


Thanks for the response. Yes, I made a typo and your part in bold is correct. That Equity Fund was bought in 2010, sold in 2011. I will update the years in the summary portion of the post.



AltaRed said:


> It seems you should be filing a T1-ADJ on your 2011 tax return to capture this data.


Would I do this as I file my 2012 tax return or is this completely separate?



AltaRed said:


> I do not know why CRA has Carry Forwards for investment gains/losses in 2010 and 2011. You may ultimately have to phone them to ask them why they have data for those 2 years (but someone else here with more CRA experience may wish to comment on whether and how to make that call).


My fiance has it worse. She's has carry forwards for investment gains/losses tracing back to I believe 2007. Once I get my situation figured out, I'll try to work on her's next.



AltaRed said:


> The T5 for 2010 would have been for interest on your savings account. Please note: Even if you did not get a T5 for your interest account in 2011, you still should have decalred any interest you earned from your savings account on your 2011 tax return. If you do a T1-ADJ for 2011, you should now declare that interest at the same time.


You know what, maybe I didn't have a savings account in 2011. I am unable to clarify because I have my TD savings account closed but I *believe* I may have wiped out my savings completely when I purchased those mutual funds in late 2010, (which sounds horrible in retrospect). This will be something I will have to clarify with a TD Branch.



AltaRed said:


> I don't understand your comment about not having dividend information yet (T3 for 2012). That doesn't matter for calculating the capital gains/losses on the sale of your investments in 2012 for Schedule 3. As I said, capital gains/losses on the sale of investments are recorded on Schedule 3 in the year of sale. Dividend information (income) is covered under Investment Income in your tax return (and can be 3-4 types of income), and does not go in Schedule 3. All income information is calendar year based and that is what the T3 you get will be for.


My bad. I misinterpreted your earlier post then. So likely this dividend information from my non-registered accounts will be on my 2012 T3 slip coming soon? This was the part that confused me from your message:


AltaRed said:


> To do that, you have to know how much you paid for each investment originally including any dividend re-investments that may have occured since date of purchase (to get your ACB or adjusted cost base).


Continuing...



AltaRed said:


> I am also puzzled by your comment on closing statement received later having different data than the sales data. Where did you get your purchase and sales data from in your post? From account statements? That information should come from monthly or quarterly account statements. I do not know what is meant by the closing statement, unless this is simply a year end statement???


Let me clarify. After a mutual fund is purchased or sold, I would immediately receive a 'Confirmation of Activity' in the mail. This provides me the exact purchases/selling information of the funds (net information, unit price, transaction units and units held). When I sold all of my mutual funds from my non-registered accounts, I received this 'Confirmation of Activity. A few months later, I received a quarterly account statement which outlined the closing price per unit, units held, and Y-T-D Distributions, Interest, Dividends and Capital Gains. The closing prices in this quarter account statement didn't match my final 'Confirmation of Activity' that was given to me.



AltaRed said:


> I can understand why your tax returns do not include Schedule 3s if you did not give your tax preparer your buy/sell data for your mutual funds, but I fail to see why there are no Schedule 4's. The tax preparer would have had to input that data if you gave them the T3 and T5 tax slips and it would have ended up on Schedule 4.


I don't know what to say. I've always given them my T3 and T5 slips when provided.



AltaRed said:


> P.S. If you want to do your own taxes for 2012, I would suggest you use some tax software such as TurboTax or Ufile or StudioTax. The first two at least have a pretty good interview process to help you plug in numbers. I suggest you spend your time at the moment though sorting out this Capital Gains/Losses stuff.


Agreed. Got a long way to go before I can think about tax software.


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## AltaRed

Money4life said:


> Would I do this as I file my 2012 tax return or is this completely separate?


It can be done at the same time, or separately. That said, it would be best to file the T1-ADJ for 2011 sooner rather than later, especially if it results in more tax owing. CRA will assess interest on amount due, but not yet paid (and potentially penalties as well, though I have found that honest mistakes usually do not carry penalties). The key thing is to sort out what your 2011 return should have said for entries. Doing T1-ADJ forms is a bit tricky because they are based on incremental differences to the orginal return for certain line items. You may need someone knowledgeable to help you put that together.




> You know what, maybe I didn't have a savings account in 2011. I am unable to clarify because I have my TD savings account closed but I *believe* I may have wiped out my savings completely when I purchased those mutual funds in late 2010, (which sounds horrible in retrospect). This will be something I will have to clarify with a TD Branch.


Okay. There is a lesson here. Keep a copy of your records, either paper copy, or PDF downloaded from the institution. Do not rely on online documents being online as you found out when you closed the accounts. All the online records disappear once an account is closed.



> So likely this dividend information from my non-registered accounts will be on my 2012 T3 slip coming soon?


The income (distributions in 2012) from your mutual fund investments will come on the T3, probably by end of February, although technically T3s can be issued as late as March 31 (or thereabouts).




> Let me clarify. After a mutual fund is purchased or sold, I would immediately receive a 'Confirmation of Activity' in the mail. This provides me the exact purchases/selling information of the funds (net information, unit price, transaction units and units held). When I sold all of my mutual funds from my non-registered accounts, I received this 'Confirmation of Activity. A few months later, I received a quarterly account statement which outlined the closing price per unit, units held, and Y-T-D Distributions, Interest, Dividends and Capital Gains. The closing prices in this quarter account statement didn't match my final 'Confirmation of Activity' that was given to me.


Ignore the end of quarter account statements and the distributions they mention. This is information for you on a quarterly basis on how your funds are doing, but they do not provide any relevant information for tax return purposes. The data on the 'Confirmation of Activity' slips is the data you need to use to calculate your capital gains/losses from asset sales.



> I don't know what to say. I've always given them my T3 and T5 slips when provided.


A mystery to me as well. If your tax returns clearly do not have a Schedule 4 in them, your tax preparer screwed up. You may have to do a T1-ADJ for both 2010 and 2011. If you do, you might include a note that the tax preparer did not include all the necessary data. I am surprised though that CRA has not sent you a letter for at least 2010 already, asking you why their records of Investment Income and Capital Sales do not match that on your tax returns. (Note that financial institutions have to send all this T3 and T5 data, and asset sales data to CRA... .and CRA computers are supposed to match that information with the information you send in on your tax returns. Computers flag errors and inconsistencies (perhaps outside a certain tolerance level - I am not knowledgeable in this aspect but some other tax gurus on this forum might know).

May look like an insurmountable task right now, but you are now grasping hold of it and making headway. Consider the glass half full.


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## Money4life

Spudd said:


> The bond fund is a bit more complicated because you kept part of it. Let's do it as our second example. Although you bought it in 2 chunks, the price was the same for each chunk, so you can calculate the cost by taking $13.59 times the number of units.
> Unit Price: $13.59, Transaction Units/Total Units Held: 845.193
> 
> Then you sold some:
> Unit Price: $13.41, Transaction Units: 456.376, Total Units Held: 395.412
> The money you got for selling this was $13.41*456.376 = $6120.00. *The money you used to buy it originally was $13.59*456.376 = $6202.15.* So you had a capital loss in this case of $82.15.


I know you were just doing a quick demonstration for me but for the bolded area, shouldn't I be multiplying $13.59 by 845.193, because that's how much I originally bought it for? So $11,486.17 - $6,120.00 = capital loss of $5,366.17?


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## Money4life

AltaRed said:


> May look like an insurmountable task right now, but you are now grasping hold of it and making headway. Consider the glass half full.


Thanks. Appreciate the help that you've provided.


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## Spudd

Money4Life, in that example, you only sold 456.376 of the units. You calculate the capital gain/loss for ONLY the units you sold. There's no capital gain/loss on the units that are still being held (that will come later, when you sell those ones). 

Example:
Buy 10 shares of stock X for $10/share. Total cost: $100
Sell 5 shares of stock X for $20/share. Total original cost of these 5 shares: $50. Total proceeds from sale: $100. Capital gains: $50
Later, sell remaining 5 shares of stock X for $40/share. Original cost of these 5 shares: $50. Total proceeds from sale: $200. Capital gains: $150

Is it clear?


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## Money4life

Spudd said:


> Money4Life, in that example, you only sold 456.376 of the units. You calculate the capital gain/loss for ONLY the units you sold. There's no capital gain/loss on the units that are still being held (that will come later, when you sell those ones).
> 
> Example:
> Buy 10 shares of stock X for $10/share. Total cost: $100
> Sell 5 shares of stock X for $20/share. Total original cost of these 5 shares: $50. Total proceeds from sale: $100. Capital gains: $50
> Later, sell remaining 5 shares of stock X for $40/share. Original cost of these 5 shares: $50. Total proceeds from sale: $200. Capital gains: $150
> 
> Is it clear?


A lot to wrap my head around for someone who's never had individual stocks but it makes sense now. It should only pertain to the amount of units being sold, not the amounts that I originally had...because I still have some of it.

It's going to get pretty complicated once I throw in those pre-authorized purchases into the mix and then factoring in which units came from which purchase prices. Fun times.


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## Money4life

To follow up; does the CRA care about capital gains/losses from RRSPs or TFSAs? Those carry-forward amounts that the CRA has on file for capital gains/losses, could those be from TFSAs or RRSPs? Or does that information only pertain to non-registered accounts?


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## AltaRed

Money4life said:


> To follow up; does the CRA care about capital gains/losses from RRSPs or TFSAs? Those carry-forward amounts that the CRA has on file for capital gains/losses, could those be from TFSAs or RRSPs? Or does that information only pertain to non-registered accounts?


Only non-registered accounts. Nothing from registered accounts.


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## Money4life

AltaRed said:


> Only non-registered accounts. Nothing from registered accounts.


Thought so. Thanks.

Argh. Still can't believe that a Mutual Fund "advisor" told me to set up a non-registered mutual funds account in November 2010. An RRSP mutual fund account wasn't suggested to me by an "advisor" until August of 2011! All before this, I was selling and buying mutual funds in my non-registered accounts.


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## Money4life

Went to the bank and at first, asked if they could provide me my capital gains and losses for all of my non-registered mutual funds (thought it was worth a try). As expected, they told me that they are not obligated to do it and that I will have to do it on my own. So then they provided me with a list of every purchase and selling that I made, including those pesky pre-paid authorization purchases. I will be able to figure it all out now.

I also asked about whether I had a savings account in 2011...and I did not. All of the money was transferred out to my Mutual Funds in the end of 2010. Explains why I didn't get a T5 last year. 

Lastly, asked about why I have amounts in my carry forward section for capital gains and losses if it wasn't reported. He said that the CRA still reports this information from the bank, even if they don't get it directly from my tax returns. So you guys were right in questioning why the CRA hasn't contacted me yet about failing to report this information?

Regardless, this will all be taken care of.


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## AltaRed

Money4life said:


> Lastly, asked about why I have amounts in my carry forward section for capital gains and losses if it wasn't reported. He said that the CRA still reports this information from the bank, even if they don't get it directly from my tax returns. So you guys were right in questioning why the CRA hasn't contacted me yet about failing to report this information?


At this point, you have not done your capital gain/loss calculations to determine whether you are in a net loss, or net gain situation for each year. If the numbers CRA has are all losses, they don't care much since they are not owed money (but you should be because you can use these losses to offset capital gains). Let us know when you have done your calculations.


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## Money4life

Just so we're clear, I know it's been asked before but I am NOT factoring in dividends being re-invested into the funds to determine capital gains or loss? Every time dividends are re-invested, the units are purchased at different prices. Aren't I buying more shares with the dividends being re-invested?

Ooh la la. I've been upgraded to Senior Member status! Too bad I don't have Senior Member knowledge.


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## Spudd

You do need to factor in those re-buys. 

The cost you paid overall for what you end up selling is called the ACB (adjusted cost base). Here's an article about how to calculate it: http://www.adjustedcostbase.ca/CanadianMoneySaver_Know_Your_ACBs.pdf

This website also provides you with a tool to calculate the ACB, you just put in all your different transactions and it will come up with it for you: http://www.adjustedcostbase.ca/


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## Money4life

Spudd said:


> You do need to factor in those re-buys.
> 
> The cost you paid overall for what you end up selling is called the ACB (adjusted cost base). Here's an article about how to calculate it: http://www.adjustedcostbase.ca/CanadianMoneySaver_Know_Your_ACBs.pdf
> 
> This website also provides you with a tool to calculate the ACB, you just put in all your different transactions and it will come up with it for you: http://www.adjustedcostbase.ca/


Cool. Thanks.

Just so I completely understand this, I'm going old school and sitting with a pencil and calculator. I'm progressing...but ever so slowly!

*EDIT* Actually, I think I've mistaken re-invested dividends with re-invested capital gain distribution. Not really a big difference when calculating ACB, right?


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## AltaRed

Money4life said:


> *EDIT* Actually, I think I've mistaken re-invested dividends with re-invested capital gain distribution. Not really a big difference when calculating ACB, right?


Any amount of money (in distribution income) thrown off by the mutual fund (in monthly or quarterly or annual amounts) and re-invested into additional units of a mutual fund adds to the adjusted cost base. They are called re-invested distributions, not re-invested dividends, nor re-invested capital gains. Think about it this way. Your mutual fund pays you a distribution of $XX.... that first step is money/cash. The fund then re-invests this distribution (as cash) into additional units of the mutual fund (just as if you were using your own cash to buy more units).

Example: Let's say you own fund ABC that, on your Confirmation slip, cost you $10000 for 1000 units. Your ACB is $10000 or $10 per unit for your 1000 units. Fund ABC then pays out a distribution at the end of March and re-invests it in more units. Lets say the Confirmation of Activity says 're-invested 5.500 [email protected] $11/unit'. That is actually worth $60.50 (5.5 x 11). Your ACB is now $10000+60.50 or $10060.50 and you now have 1005.5 units... making your ACB on a per unit basis $10.005469 per unit or $10.0055 rounded off to 4 decimal places (the latter value being important only when you eventually sell only a portion of your units of the fund in any given year - per an example given to you earlier on the TD Canadian Bond fund).

If the same fund pays out another distribution at the end of June, you have to rinse and repeat the cycle above to get a new ACB (total) and a new ACB (per unit).


----------



## Money4life

AltaRed said:


> Any amount of money (in distribution income) thrown off by the mutual fund (in monthly or quarterly or annual amounts) and re-invested into additional units of a mutual fund adds to the adjusted cost base. They are called re-invested distributions, not re-invested dividends, nor re-invested capital gains. Think about it this way. Your mutual fund pays you a distribution of $XX.... that first step is money/cash. The fund then re-invests this distribution (as cash) into additional units of the mutual fund (just as if you were using your own cash to buy more units).
> 
> Example: Let's say you own fund ABC that, on your Confirmation slip, cost you $10000 for 1000 units. Your ACB is $10000 or $10 per unit for your 1000 units. Fund ABC then pays out a distribution at the end of March and re-invests it in more units. Lets say the Confirmation of Activity says 're-invested 5.500 [email protected] $11/unit'. That is actually worth $60.50 (5.5 x 11). Your ACB is now $10000+60.50 or $10060.50 and you now have 1005.5 units... making your ACB on a per unit basis $10.005469 per unit or $10.0055 rounded off to 4 decimal places (the latter value being important only when you eventually sell only a portion of your units of the fund in any given year - per an example given to you earlier on the TD Canadian Bond fund).
> 
> If the same fund pays out another distribution at the end of June, you have to rinse and repeat the cycle above to get a new ACB (total) and a new ACB (per unit).


OK. So I would just treat these re-invested distributions as new purchases made by me?

Appreciate the help.


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## Eclectic12

Money4life said:


> OK. So I would just treat these re-invested distributions as new purchases made by me? ...


Yes - "re-invested" or "dividend re-invested" are just terms to indicate where the money came from for the purchase of more units. It is the fact that more units are being purchased that is changing your cost (i.e. ACB).


Cheers


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## leeder

While we're on taxes.... for any income earned from inside an investment savings account, such as TDB8150, are those treated as interest from Canadian sources? I ask this because I noticed that the T5 that TD Waterhouse provided did not include the income amount in the T5 Box 13 - Interest from Canadian sources.


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## AltaRed

leeder said:


> While we're on taxes.... for any income earned from inside an investment savings account, such as TDB8150, are those treated as interest from Canadian sources? I ask this because I noticed that the T5 that TD Waterhouse provided did not include the income amount in the T5 Box 13 - Interest from Canadian sources.


Did the T5 list it as Other Income? In any event, whatever 'income' box the T5 puts it in, just use it as provided. CRA is at its happiest when individual tax returns match the data they get directly from the financial institutions.


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## leeder

@ Altared: No, it was not included in a separate box. It was not included as part of dividends either (I've been tracking my dividends). I wonder if it's just TDW not including it b/c it's under $50...


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## AltaRed

leeder said:


> @ Altared: No, it was not included in a separate box. It was not included as part of dividends either (I've been tracking my dividends). I wonder if it's just TDW not including it b/c it's under $50...


Sorry, I misunderstood. I would agree this should be 'Interest from Canadian sources' and where I would put it (for all intent and purposes, it is a CDIC insured bank account per Terms and Conditions http://www.tdassetmanagement.com/images2/TD ISA Terms and Conditions E.pdf )


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## Money4life

AltaRed said:


> Let us know when you have done your calculations.


IN 2011:

- I made a capital gain of $1,036.17 from selling all of the Equity Fund in February
- capital loss of $81.79 from selling a portion of the Bond Fund in February
- capital loss of $1,995.25 from selling a portion of the Communications Fund in August

= capital loss of $1,040.87

IN 2012:

- capital loss of $1,363.29 from selling all of the Precious Metals Fund in April.
- capital gain of $345.37 from selling all of the Communications Fund in July.
- capital gain of $348.67 from selling all of the Bond Fund in July.
- capital gain of $484.51 from selling all of the Dividend Fund in July.
- capital loss of $670.21 from selling all of the Technology Fund in July.

= capital loss of $854.95

So I essentially lost $1,892.82 by purchasing non-diversified sector funds and kept selling when the value was low due to indecisiveness. Now I'm curious but at the same time, afraid to do the same calculations to see how I did with my TFSA and RRSP mutual funds.

Anyway, so I will need to fill out a T1-ADJ form for 2011. This would be for Line 127, correct? Do I need to attach a Schedule 3 form even though this information will already be on the adjustment form? 

Other adjustments I will need to make:

- $1.27 of 'Foreign Non-Bus. Income' was not included on my 2010 Tax Return. So I shall make an adjustment and add $1.27 to the amount that already exists on Line 121?
- None of my prior tax returns have schedules 4 included. Do I need to make a T1 Adjustment for this? Line 121 has already been filled out on my T1 but no schedule 4s were supplied. 

Do I need to make any more adjustments from past tax returns? Obviously, I can do the 2012 capital loss when I file taxes this year.


----------



## OhGreatGuru

*Anyone does their tax by themselves?*

Yes, I am still of the paper generation. I am still leery of the "black box" software. And I think I would have a harder time making sure I had completed all the necessary schedules and forms on a computer. Undoubtedly I will change some day. "Resistance is Futile" and all that. Or maybe I can postpone it until one of my children has to manage my affairs.


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## Eclectic12

leeder said:


> While we're on taxes.... for any income earned from inside an investment savings account, such as TDB8150, are those treated as interest from Canadian sources?
> 
> I ask this because I noticed that the T5 that TD Waterhouse provided did not include the income amount in the T5 Box 13 - Interest from Canadian sources.
> 
> ... I wonder if it's just TDW not including it b/c it's under $50...


Is the T5 from this year? If so, is it possibly that you get a bunch of T5's and this one hasn't been delivered yet? I get a series of T forms with varying dates. I haven't tracked the T5's in particular.


Cheers


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## Eclectic12

OhGreatGuru said:


> *Anyone does their tax by themselves?*
> 
> Yes, I am still of the paper generation. I am still leery of the "black box" software. And I think I would have a harder time making sure I had completed all the necessary schedules and forms on a computer. Undoubtedly I will change some day. "Resistance is Futile" and all that. Or maybe I can postpone it until one of my children has to manage my affairs.


Maybe it will take that long. Though are you comfortable with using a spreadsheet on a computer? 

If so, you may want to try the tax spreadsheet at the following link.
http://www.peeltech.ca/mytax.shtml

It takes a bit of getting used to where the data entry part is setup but unlike the "black box" software, you can click on the cells to see how the calculations are done.


Cheers


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## AltaRed

Eclectic12 said:


> Is the T5 from this year? If so, is it possibly that you get a bunch of T5's and this one hasn't been delivered yet? I get a series of T forms with varying dates. I haven't tracked the T5's in particular.


Good point. If the poster is talking 2012 T5s, they do not have to be mailed until Feb 28th. T3s do not have to be mailed until Mar 31 (I believe) and some of them do not show up in mailboxes until as late as Apr 10th or so. ETFs seem to be big drag on issuance of T3s since they have to come from the ETF provider...to the brokerage... and then out to investors.


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## leeder

@ Eclectic and Altared: I signed up for eServices at TD Waterhouse, where they just upload a pdf copy of my T5, trading summary, and RRSP contribution slip. As mentioned, my T5 currently only has eligible dividend info. When I calculated my Cdn interest generated from the TD Investment Savings Account, I received $39.75. My guess is that they didn't bother reporting anything less than $50. That said, I'll still include it in my tax return as Cdn interest.


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## AltaRed

Money4life said:


> Anyway, so I will need to fill out a T1-ADJ form for 2011. This would be for Line 127, correct? Do I need to attach a Schedule 3 form even though this information will already be on the adjustment form?


Yes, it would be Line 127 BUT since capital gains (and losses) are only taxed at 50% of their value, your actual loss that you would put on Line 127 is 50% of $1040.87 or $520.44. That said, this number does not relate to the $241 that CRA carries on your file, and CRA also has a number of $188 for 2010 on your file. You still have not told us what these numbers mean from your CRA account. Maybe you could paste that piece here in the forum (with no identifying information), or mimic the data with a spreadsheet and post it. I would not do a T1-ADJ until you understand what the CRA data means. It will likely trigger a CRA question.



> Other adjustments I will need to make:
> 
> - $1.27 of 'Foreign Non-Bus. Income' was not included on my 2010 Tax Return. So I shall make an adjustment and add $1.27 to the amount that already exists on Line 121?
> - None of my prior tax returns have schedules 4 included. Do I need to make a T1 Adjustment for this? Line 121 has already been filled out on my T1 but no schedule 4s were supplied.


You would add an incremental $1.27 on Line 121 on a T1-ADJ for 2010 (not 2011). Also, when you have foreign non-business income, there would normally be some Foreign tax paid, and that should show up as a Foreign Tax Credit on line 405 on Schedule 1 (in this case 15% of $1.47, or $0.22 in tax you should get back). 
That said, if you have no other reason to 'correct' your 2010 tax return, I do not think it worthwhile to file a T1-ADJ for 2010 because the difference in tax payable will be less than $1 and CRA wouldn't normally issue a request for you to pay this.

It is strange that your tax preparer did not give you Schedule 4s with your tax returns, but if your tax returns include data for Line 120 (eligible dividends) and/or Line 121 (Canadian interest and foreign non-business income), then your tax preparer did do the inputs. I think it would be worth your while to verify that Lines 120, 121, 405 and 425 are correct (other than that $1.47 issue) for both 2010 and 2011 tax returns (when taking a look at all your T3s and T5s for those years). That way, you can at least be satisfied that your Investment Income (T3s and T5s) was inputted properly



> Obviously, I can do the 2012 capital loss when I file taxes this year.


 That is the only time you can do this for 2012. Remember when you do your 2012 tax return, Schedule 3, at the very last line, will use 50% of your capital loss to put on Line 127.


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## Money4life

AltaRed said:


> Yes, it would be Line 127 BUT since capital gains (and losses) are only taxed at 50% of their value, your actual loss that you would put on Line 127 is 50% of $1040.87 or $520.44.


Good to know.



AltaRed said:


> That said, this number does not relate to the $241 that CRA carries on your file, and CRA also has a number of $188 for 2010 on your file. You still have not told us what these numbers mean from your CRA account. Maybe you could paste that piece here in the forum (with no identifying information), or mimic the data with a spreadsheet and post it.


I'm not sure what else I need to be pasting from my CRA account. In the carry-forward amount section, those are the only numbers that are provided. I do not know where these numbers came from. The CRA account in under maintenance all weekend so I am unable to check anyway.



AltaRed said:


> You would add an incremental $1.27 on Line 121 on a T1-ADJ for 2010 (not 2011). Also, when you have foreign non-business income, there would normally be some Foreign tax paid, and that should show up as a Foreign Tax Credit on line 405 on Schedule 1 (in this case 15% of $1.47, or $0.22 in tax you should get back).
> That said, if you have no other reason to 'correct' your 2010 tax return, I do not think it worthwhile to file a T1-ADJ for 2010 because the difference in tax payable will be less than $1 and CRA wouldn't normally issue a request for you to pay this.


No amount on Line 405 was provided on Schedule 1 (as expected, since the $1.27 was neglected from my tax return). I don't think there are any other problems with this return from what I can tell.



AltaRed said:


> It is strange that your tax preparer did not give you Schedule 4s with your tax returns, but if your tax returns include data for Line 120 (eligible dividends) and/or Line 121 (Canadian interest and foreign non-business income), then your tax preparer did do the inputs. I think it would be worth your while to verify that Lines 120, 121, 405 and 425 are correct (other than that $1.47 issue) for both 2010 and 2011 tax returns (when taking a look at all your T3s and T5s for those years). That way, you can at least be satisfied that your Investment Income (T3s and T5s) was inputted properly


I have verified the other lines and they look good to me (never noticed Line 425 until now). One other potential problem I see now though is that on my T3, I have an amount of $41.86 in Line 49 - Actual Amount of Eligible Dividends. I'm not seeing this number anywhere on my tax return. I have some other unanswered questions from earlier in the thread as well.

For Line 330, Medical Expenses: For the last two tax years, I've had amounts reported for this by H&R Block and I'm not sure why. Is there a way I can see where these amounts came from? I see that this information isn't on my T4 slip. Any payments made to a dentist or doctor, for example, were covered by my work benefits.

Where does it show on a tax return that a tax credit was received for rental expenses in a year? My fiance who had a total income of $37,000 submitted a rent receipt for tax year 2011. I want to make sure that this was properly claimed.


----------



## AltaRed

Money4life said:


> I have verified the other lines and they look good to me (never noticed Line 425 until now). One other potential problem I see now though is that on my T3, I have an amount of $41.86 in Line 49 - Actual Amount of Eligible Dividends. I'm not seeing this number anywhere on my tax return. I have some other unanswered questions from earlier in the thread as well.


Your response is conflicted. You first say you have verified the other lines and they look good to you, but yet you question Line 425 and you also do not see anything on Line 120 for Eligible Dividends from your T3. Line 120 and 425 are directly related to Eligible Dividends and Dividend Tax Credit respectively from T3s.



> For Line 330, Medical Expenses: For the last two tax years, I've had amounts reported for this by H&R Block and I'm not sure why. Is there a way I can see where these amounts came from? I see that this information isn't on my T4 slip. Any payments made to a dentist or doctor, for example, were covered by my work benefits.


This would have either come from your share of payments made into the company health plan (not gov't plan, but for say Blue Cross or similar extended health benefits) and/or amount of co-pay you paid to dentists, doctors, and drugs that your work plan did not cover. Since your tax preparer would not have invented data, did you give them health provider statements or simliar?



> Where does it show on a tax return that a tax credit was received for rental expenses in a year? My fiance who had a total income of $37,000 submitted a rent receipt for tax year 2011. I want to make sure that this was properly claimed.


I may not be understanding you correctly, but rental income and expense is normally done on Form T776 (which you may, or may not, have in your package). Only the net number (difference) is then shown on Line 126 (there are not separate lines on the tax return for each of rental income and expense).


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## Money4life

AltaRed said:


> Your response is conflicted. You first say you have verified the other lines and they look good to you, but yet you question Line 425 and you also do not see anything on Line 120 for Eligible Dividends from your T3. Line 120 and 425 are directly related to Eligible Dividends and Dividend Tax Credit respectively from T3s.


I never said that I didn't see anything on Line 120. What I said is that there's an amount of $41.86 in Line 49 - Actual amount of eligible dividends on my T3 but not listed on my tax return. The amount of $59.02 is listed on my tax return on Line 121 but this amount was from Line 50 - Taxable amount of eligible dividends on my T3. I have not questioned Line 425; all I said was that I never noticed it until now.



AltaRed said:


> This would have either come from your share of payments made into the company health plan (not gov't plan, but for say Blue Cross or similar extended health benefits) and/or amount of co-pay you paid to dentists, doctors, and drugs that your work plan did not cover. Since your tax preparer would not have invented data, did you give them health provider statements or simliar?


I went over my max a few times before with Extended Health Benefits but I've never actually submitted these expenses for tax purposes.



AltaRed said:


> I may not be understanding you correctly, but rental income and expense is normally done on Form T776 (which you may, or may not, have in your package). Only the net number (difference) is then shown on Line 126 (there are not separate lines on the tax return for each of rental income and expense).


Wow, that is extremely misleading. Sorry. I just copied what I said from an earlier post. Definitely should have NOT used the word income. By total income, I meant her gross income from employment. We are only making rental payments; we don't have rental income or expenses. I assume this has nothing to do with Line 126. Where would I see these annual rental payments on a tax return? 

Sorry if I have been giving poor, conflicting responses. Worked an overnight shift last night and didn't get the right amount of sleep. I shouldn't have been replying to this thread until later.


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## AltaRed

Money4life said:


> I never said that I didn't see anything on Line 120. What I said is that there's an amount of $41.86 in Line 49 - Actual amount of eligible dividends on my T3 but not listed on my tax return. The amount of $59.02 is listed on my tax return on Line 121 but this amount was from Line 50 - Taxable amount of eligible dividends on my T3. I have not questioned Line 425; all I said was that I never noticed it until now.


Ah, sorry, I misunderstood. The actual amount of dividends (41.86) is not used for anything. It is the taxable (grossed up amount of 59.02) that is used on the tax return. So it is done correctly.



> Wow, that is extremely misleading. Sorry. I just copied what I said from an earlier post. Definitely should have NOT used the word income. By total income, I meant her gross income from employment. We are only making rental payments; we don't have rental income or expenses. I assume this has nothing to do with Line 126. Where would I see these annual rental payments on a tax return?


Your rent payments on your principal residence are not tax deductible - unless you or your fiance work as contractors, i.e. self-employed, etc. in which case only a portion of your rent is tax deductible - proportionate to some desk/office space you use for that purpose, and that would be handled under self-employment section of the tax return. If you have such a situation, there are IT Tax bulletins that describe this from the CRA site, including what is a deductible expense and not. If you are employees, i.e. your income is on T4s, there is zilch for tax deductibility.


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## Money4life

AltaRed said:


> Your rent payments on your principal residence are not tax deductible.


What about a tax credit? I know some are eligible for an Ontario Energy or Property Tax Credit but is that it?


----------



## AltaRed

Money4life said:


> What about a tax credit? I know some are eligible for an Ontario Energy or Property Tax Credit but is that it?


Provincial credits, if any, should be automatically calculated on the provincial tax calculation sheet that is part of your return. I have no knowledge of Ontario, but I would be surprised there would be Energy or Property Tax credits for anyone beyond almost low income levels, or as a Senior over 65. There are other federal credits like transit passes, fitness, etc. that require bonafide receipts. I have never used them so cannot help there.

When doing your tax returns for 2012, use a tax software package. The better ones like TurboTax and Ufile automatically will calculate the credits due to you (including things like the working income tax benefit, etc). I am not familiar with TurboTax, but Ufile starts by taking you through an interview process asking if you have certain types of income/expenses and you simply tick off the boxes, and then the software makes the appropriate forms available for you to fill out the data.


----------



## Spudd

I know in Ontario you can claim your rent expenses, and if your income is over some threshold, they won't actually help. I don't know what the threshold is. It's on one of the pink Ontario forms.


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## AltaRed

All the more reason to use tax software. https://secure.globeadvisor.com/servlet/ArticleNews/story/gam/20130207/GICARRICK0206ATL


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## Eclectic12

Spudd said:


> I know in Ontario you can claim your rent expenses, and if your income is over some threshold, they won't actually help. I don't know what the threshold is. It's on one of the pink Ontario forms.


The 2010 tax forms had an Ontario form ON479 that showed one on line 2 that their rent paid was being reduced by 80%. Or as the form puts it, rent paid times 20%. The 2011 forms seems to have one report rent paid on form ON-BEN line 6110. 

I have not traced the process in enough detail to figure out where the income cancels the tax credit.

However, there is an online calculator:
http://www.fin.gov.on.ca/en/taxcredits/calculatorquestions.asp

Assuming rent of $12K, it appears the credit disappears at about $46.7K of income (i.e. estimated credit is $2).


Cheers


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## Money4life

Eclectic12 said:


> Assuming rent of $12K, it appears the credit disappears at about $46.7K of income (i.e. estimated credit is $2).
> Cheers


Thanks. My fiance will be able to take advantage of it then.


----------



## Money4life

AltaRed said:


> That said, this number does not relate to the $241 that CRA carries on your file, and CRA also has a number of $188 for 2010 on your file. You still have not told us what these numbers mean from your CRA account. Maybe you could paste that piece here in the forum (with no identifying information), or mimic the data with a spreadsheet and post it. I would not do a T1-ADJ until you understand what the CRA data means.


OK... the CRA website has finished its maintenance. What did you want me to paste to determine where this carry-over amount came from? Looking more closely, it appears a 'Calculation of Cumulative Net Investment Loss' T936 Form was filled out in both years for Line 6810 - 'Other property income reported'. For 2011, an amount of $176 appears and for 2010, $87 appears. Still doesn't add to up to $241 or $188.


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## AltaRed

Cumulative Net Investment Loss (or CNIL) isn't a relevant number for the average employee. What is more important is when you are on the CRA website, select the Tax Return tab, and then click on Carryover Amounts. The data in this tab is what is important for establishing your capital gain/loss amounts. Is there any data associated with the top table (Capital Gains and Losses)?


----------



## Money4life

AltaRed said:


> Cumulative Net Investment Loss (or CNIL) isn't a relevant number for the average employee. What is more important is when you are on the CRA website, select the Tax Return tab, and then click on Carryover Amounts. The data in this tab is what is important for establishing your capital gain/loss amounts. Is there any data associated with the top table (Capital Gains and Losses)?


All I see is this:


----------



## Eclectic12

AltaRed said:


> Provincial credits, if any, should be automatically calculated on the provincial tax calculation sheet that is part of your return...


Doing them by hand or by software, I believe one has to apply for the credit. I believe the only warning I've had in the past is if the software has a "check the return for missed items" process that provides a warning.




AltaRed said:


> ... I have no knowledge of Ontario, but I would be surprised there would be Energy or Property Tax credits for anyone beyond almost low income levels, or as a Senior over 65 ...


I was surprised that for a rent of $12K, the credit vanishes are just under $47K ... I thought it was gone at a lower income level.


Cheers


----------



## AltaRed

Thank you. I have no idea where those would have come from in the absence of you having any Line 127 data on your 2010 and 2011 tax returns. One more thing that I would ask you to check. On that same Tax Return tab on the CRA website, click on Tax Returns for each of 2010 and 2011 and see if the data presented there shows any information on Line 127 for either return.... just to be sure those 2 numbers do not show there for some reason.

If it doesn't show there, I would suggest you make one attempt at phoning CRA and asking them to explain where that data came from. They may not know, or they may say 'from xxxx tax return', or xxxx T3 or T5 tax slips, etc.

Failing that, I think you now just need to do that T1-ADJ for 2011, to record a Capital Loss for future use. You can do right on the CRA website if you wish under 'Change a Tax Return'. I've never done one that way, but it seems easy enough. You just pick the year you want to change, and on the line you want to change, i.e. Line 127, and put in your NEGATIVE data point to show the capital loss for 2011 (remember it is 50% of the number you calculated). Just keep your own records if you do it online.


----------



## Money4life

AltaRed said:


> Thank you. I have no idea where those would have come from in the absence of you having any Line 127 data on your 2010 and 2011 tax returns. One more thing that I would ask you to check. On that same Tax Return tab on the CRA website, click on Tax Returns for each of 2010 and 2011 and see if the data presented there shows any information on Line 127 for either return.... just to be sure those 2 numbers do not show there for some reason.
> 
> If it doesn't show there, I would suggest you make one attempt at phoning CRA and asking them to explain where that data came from. They may not know, or they may say 'from xxxx tax return', or xxxx T3 or T5 tax slips, etc.
> 
> Failing that, I think you now just need to do that T1-ADJ for 2011, to record a Capital Loss for future use. You can do right on the CRA website if you wish under 'Change a Tax Return'. I've never done one that way, but it seems easy enough. You just pick the year you want to change, and on the line you want to change, i.e. Line 127, and put in your NEGATIVE data point to show the capital loss for 2011 (remember it is 50% of the number you calculated). Just keep your own records if you do it online.


No amounts have been entered in Line 127 for any of the years. I will contact CRA before I make any adjustments to prior tax returns. Thanks.


----------



## Money4life

So I got in touch with CRA and they said that the amount that appears in 'Net investment gain/loss' under Capital Gains Deduction is just an accumulation of additional total income that I've reported. The $241 from 2011 is my Line 120 + Line 121 + Line 130. $59 + $6 + $176 = $241. The $188 from 2011 is my Line 121 + Line 130. $101 + $87 = $188. I did not have additional total income reported from prior years. I'm going to check my fiance's history to see if her return numbers match the website.

Does anyone else have this same information for carryover amounts? I wonder if these amounts will change once I report my actual capital losses from my mutual funds though it appears that they are unrelated.


----------



## AltaRed

Money4life said:


> So I got in touch with CRA and they said that the amount that appears in 'Net investment gain/loss' under Capital Gains Deduction is just an accumulation of additional total income that I've reported. The $241 from 2011 is my Line 120 + Line 121 + Line 130. $59 + $6 + $176 = $241. The $188 from 2011 is my Line 121 + Line 130. $101 + $87 = $188. I did not have additional total income reported from prior years.


Those investment gains/losses can thus be ignored and  have nothing to do with Capital Gains/Losses (which would normally show up in a table just above the table you pasted into your post above). So everything is in order EXCEPT to do that T1-ADJ for 2011 to get your Capital Losses  recorded on CRA's books. These capital losses will come in useful in future years when you have some capital gains that you would otherwise have to pay tax on, but which you can now bring forward past year capital losses to help offset that.

Example: Let's say you have $500 of capital gains in 2014 tax year from something you sold, or some capital gain that is shown on a T3 slip. You can use up some of your accumulated capital losses from Line 127 from previous years (2011 and/or 2012), to partially or totally offset that $500 in capital gains.


----------



## Eclectic12

AltaRed said:


> ... So everything is in order EXCEPT to do that T1-ADJ for 2011 to get your Capital Losses  recorded on CRA's books. These capital losses will come in useful in future years when you have some capital gains that you would otherwise have to pay tax on, but which you can now bring forward past year capital losses to help offset that...


True ... though the CL might come in handy earlier than future years for the OP. 

After the 2011 net CL is established, it can also be applied to CG that was reported in previous three years (i.e. tax years 2010, 2009 or 2008).
http://www.cra-arc.gc.ca/tx/ndvdls/...cm/lns101-170/127/lss-ddct/gnrl/menu-eng.html


Cheers


----------



## Money4life

Eclectic12 said:


> True ... though the CL might come in handy earlier than future years for the OP.
> 
> After the 2011 net CL is established, it can also be applied to CG that was reported in previous three years (i.e. tax years 2010, 2009 or 2008).
> http://www.cra-arc.gc.ca/tx/ndvdls/...cm/lns101-170/127/lss-ddct/gnrl/menu-eng.html
> Cheers


Good call but I don't believe I have any capital gains reported in previous years.


----------



## Money4life

I was going to go ahead and make the T1 adjustment when I first thought to look at the fiance's return just to see if the "Net Investment gain/loss" matches with her additional income lines...and they did. Then I remembered my question about rental payments and wanted to see if that was properly claimed (or applied for). Went to the fiance's return and could not see any information about the Ontario Energy and Property Tax Credit. Logged back onto mine and sure enough, the application to apply for the tax credit was under *my* name! We did NOT tell the H&R Block advisor to do that. My fiance is the one with the lower income and that is why we specifically had the rental receipts addressed to her name. What a fucking idiot. Also, last year, once he figured out our two refunds, he revealed that he accidentally put the entire public transit amount on my return as opposed to separating it. At the time, we told it him it was OK because technically we were still getting the credits...but that should have encouraged us to check over his work for other mistakes. The H&R Block tax return summary shows nothing about me applying for the energy and property tax credit. The only way I would have found this out is after the tax return was assessed but I did not join the CRA website until last month. The problem is that I used to trust "experts" to do the simplest things for me. Not anymore.

So who do we contact first to get this addressed? H&R Block or CRA? I'm guessing that we're both going to need to do a T1 Adjustment for this. Last year, when we told the CRA that we were common law, they retroactively took away GST/HST credits that were given to my fiance. It's only fair that they retroactively provide energy and property tax credits to my fiance for the months missed.


----------



## MoneyGal

Both of those credits are based on net family income, not your fiancee's income; she may not qualify. The software will be indifferent to whether the credits are entered in your name or your fiancee's (or common-law spouse for the purposes of the Income Tax Act) -- it doesn't make any difference; either your household is eligible or it is not.


----------



## MoneyGal

Also - FWIW - I don't think anyone here would refer to H&R Block as "tax experts" or refer anyone to them; I certainly would not.


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## Money4life

MoneyGal said:


> Both of those credits are based on net family income, not your fiancee's income; she may not qualify. The software will be indifferent to whether the credits are entered in your name or your fiancee's (or common-law spouse for the purposes of the Income Tax Act) -- it doesn't make any difference; either your household is eligible or it is not.


Damn, really? I guess I was a little premature to call him a fucking idiot. Naw...I still stand by it.

Thanks for the disappointing information, MoneyGal. Though in retrospect, seems strange that they retroactively took payments back for HST/GST but not Energy/Property Tax credits that were given to her at the time.


----------



## MoneyGal

...I thought you said she *didn't* get the energy and property tax credits?


----------



## Money4life

MoneyGal said:


> ...I thought you said she *didn't* get the energy and property tax credits?


She used to get both back in the day (2010-early 2011?). You have to apply for it every year. A little after she submitted her taxes last year, a notice from the CRA came in to let her know that she owed money for past GST/HST payments. I *believe* during that same time, she was still getting energy and property tax credits which is why that I thought they would ask for that money back as well.

I thought that if she applied for the energy and property tax credits instead of me during last year's tax return, she would be entitled to it. That's what I meant about her not getting energy and tax credits. That was for this past year and not before that. Sorry, I have a habit of making things confusing.


----------



## AltaRed

Money4life said:


> She used to get both back in the day (2010-early 2011?). You have to apply for it every year. A little after she submitted her taxes last year, a notice from the CRA came in to let her know that she owed money for past GST/HST payments. I *believe* during that same time, she was still getting energy and property tax credits which is why that I thought they would ask for that money back as well.


I may be wrong here but CRA *is* interested in getting the GST/HST credits back (feds). I am guessing they have zero interest in Ontario tax credits since it is no skin off CRA's back whether Ontario knows what it is doing or not. I don't think CRA has any obligation to look out for the interest of the provinces (they merely collect provincial taxes on behalf of the provinces). I suspect I wouldn't worry about that much.


----------



## AltaRed

Money4life said:


> Good call but I don't believe I have any capital gains reported in previous years.


That was my understanding as well since it seems nothing appears in the upper (capital gains/losses) table on his MyAccount with CRA.


----------



## Money4life

AltaRed said:


> You just pick the year you want to change, and on the line you want to change, i.e. Line 127, and put in your NEGATIVE data point to show the capital loss for 2011 (remember it is 50% of the number you calculated). Just keep your own records if you do it online.


Was just going to do this and decided to read the tax guide.









For some reason, it won't let me post the second screen shot. But the second screen shot says:
_"If the result is negative (loss), do not claim the amount of line 127 of your return. We will register it in our system."_

So I guess I'm not multiplying the amount by 50% and Line 127 is still going to be zero?


Also, it appears it is very straight forward to change my return online for 2011. But looking ahead for doing my taxes this year, on Schedule 3, it asks to give you the name of the fund. Do they want you to fill out a separate schedule 3 for every mutual fund? It seems like it judging by the way the form looks.
http://www.cra-arc.gc.ca/E/pbg/tf/5000-s3/5000-s3-fill-12e.pdf


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## Eclectic12

Money4life said:


> Good call but I don't believe I have any capital gains reported in previous years.


It's something I seem to forget when I can make good use of it ... :rolleyes2:




Money4life said:


> .... the second screen shot says:
> _"If the result is negative (loss), do not claim the amount of line 127 of your return. We will register it in our system."_
> 
> So I guess I'm not multiplying the amount by 50% and Line 127 is still going to be zero?


IMO, you still need to multiply by the 50% to figure out the final CL amount on Schedule 3, line 199. The line starts with "Multiply by 50%" and then adds for a CG, transfer to the T1 form, line 127 and for CL, consult the guide (i.e. keep the T1 form, lin2 at zero).

If the 50% calculation is not done, you'll be unaware of the final amount for future tax returns. It's also harder to confirm on your NOA if CRA is reporting the after 50% CL and you haven't done the calculation. 

Or were you thinking you'd be able to claim 100% of the CL while paying taxes on only 50%? :chuncky:




Money4life said:


> ... But looking ahead for doing my taxes this year, on Schedule 3, it asks to give you the name of the fund. Do they want you to fill out a separate schedule 3 for every mutual fund? It seems like it judging by the way the form looks...


I find it easier that way. With less detail, it is harder for me to figure out any errors or oversights. Then too, if it comes up for audit, I don't have to go searching for any additional notes or documentation - that detail for each investment is already in the tax return.

Of course a spreadsheet or software makes it easy to add extra lines to schedule 3 for this purpose.



Cheers


----------



## Money4life

Money4life said:


> Also, it appears it is very straight forward to change my return online for 2011.
> http://www.cra-arc.gc.ca/E/pbg/tf/5000-s3/5000-s3-fill-12e.pdf


Or maybe it's not so straight forward. 

For Line 132 in Schedule 3 - "Gain (or loss) - Mutual fund units, deferral of eligible small business corporation shares, and other shares including publicly traded shares":
I entered my amount in parentheses  and this error appeared:

*Error 1: The entry at line 132 must be in the following format - 9999*.

If I don't add the parentheses, how are they going to determine if it's a gain or a loss? Changing a previous return online doesn't allow you to be very detailed.


Sorry guys for asking so many questions. I'm actually getting really frustrated that it has taken me 10 pages to figure out my capital losses and how to properly report it.


----------



## Money4life

Eclectic12 said:


> Or were you thinking you'd be able to claim 100% of the CL while paying taxes on only 50%? :chuncky:


To be honest, I'm not even sure what I was thinking at this point. It does sound ridiculous actually.



Eclectic12 said:


> Of course a spreadsheet or software makes it easy to add extra lines to schedule 3 for this purpose.


Hopefully. Because changing a prior return online doesn't seem to allow this convenience.


----------



## AltaRed

Money4life said:


> Was just going to do this and decided to read the tax guide.
> 
> View attachment 215
> 
> 
> For some reason, it won't let me post the second screen shot. But the second screen shot says:
> _"If the result is negative (loss), do not claim the amount of line 127 of your return. We will register it in our system."_
> 
> So I guess I'm not multiplying the amount by 50% and Line 127 is still going to be zero?


My incompleteness in my explanation.......sorry. If you were to fill out a Schedule 3, it adds up all the capital gains and losses for all sales, and gives you a net number on Line 197 on Schedule 3. Then Schedule 3 says to take 50% of the number and enter it on Line 199. It is the amount on that Line 199 that gets placed on Line 127 in your tax return (but yes, only if positive, otherwise it is zero). Now the question is, where on the T1-ADJ does one put a negative Line 199 number? That negative number (number in parantheses) actually ends up on form T936 Cumulative Net Investment Loss Chart A, but you don't need to worry about that.

So on your T1-ADJ, simply say Schedule 3, Line 199 (50% of the loss in parenthesis), or if you prefer say Schedule 3, Line 197 with 100% of the number in parentheses. CRA will capture that in their system. 



> But looking ahead for doing my taxes this year, on Schedule 3, it asks to give you the name of the fund. Do they want you to fill out a separate schedule 3 for every mutual fund? It seems like it judging by the way the form looks.
> http://www.cra-arc.gc.ca/E/pbg/tf/5000-s3/5000-s3-fill-12e.pdf


Schedule 3 has multiple lines for multiple entries of mutual fund or share sales. Enter each sale on a separate line on Schedule 3. I've had several multiple entries over the years. It is only the net that gets collected at the bottom of Schedule 3.


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## Money4life

AltaRed said:


> My incompleteness in my explanation.......sorry. If you were to fill out a Schedule 3, it adds up all the capital gains and losses for all sales, and gives you a net number on Line 197 on Schedule 3. Then Schedule 3 says to take 50% of the number and enter it on Line 199. It is the amount on that Line 199 that gets placed on Line 127 in your tax return (but yes, only if positive, otherwise it is zero). Now the question is, where on the T1-ADJ does one put a negative Line 199 number? That negative number (number in parantheses) actually ends up on form T936 Cumulative Net Investment Loss Chart A, but you don't need to worry about that.
> 
> So on your T1-ADJ, simply say Schedule 3, Line 199 (50% of the loss in parenthesis), or if you prefer say Schedule 3, Line 197 with 100% of the number in parentheses. CRA will capture that in their system.
> 
> 
> Schedule 3 has multiple lines for multiple entries of mutual fund or share sales. Enter each sale on a separate line on Schedule 3. I've had several multiple entries over the years. It is only the net that gets collected at the bottom of Schedule 3.


When adjusting your T1 online from a previous year, you are not allowed to enter anything on Line 197 or Line 199 in your Schedule 3. It does not give you that option or even show you the amounts on those lines. The only lines you are allowed to make changes with on your Schedule 3 are: 270, 107, 271, 110, 272, 124, 132, 138, 153, 155, 158, 159, 161, 273, 173, 174, 176 and 178. In addition, if you add any parentheses, an error message appears: *Error 1: The entry at line 132 must be in the following format - 9999*. You are allowed to enter a minus character though.

So for Line 132, should I enter in the full amount of -1042? I don't know how else I would do this if I tried to make an adjustment online.


----------



## AltaRed

Money4life said:


> When adjusting your T1 online from a previous year, you are not allowed to enter anything on Line 197 or Line 199 in your Schedule 3. It does not give you that option or even show you the amounts on those lines. The only lines you are allowed to make changes with on your Schedule 3 are: 270, 107, 271, 110, 272, 124, 132, 138, 153, 155, 158, 159, 161, 273, 173, 174, 176 and 178. In addition, if you add any parentheses, an error message appears: *Error 1: The entry at line 132 must be in the following format - 9999*. You are allowed to enter a minus character though.


I may be misunderstanding you, but are you trying to adjust your prior year (2011) T1 return? You don't do that once a return has been filed. You file a T1-ADJ form http://www.cra-arc.gc.ca/E/pbg/tf/t1-adj/t1-adj-12e.pdf in which in Section C, you put in the adjustment you want.

In your case, you would put:
- either Line 197 (or Line 199) in the first box (Line number from return or schedule)
- the name of Line 197 (or Line 199) in the next box
- 0 for Previous amount in the next box
- negative sign in the next box
- the change in the next box (number depending on whether you use Line 197 or Line 199
- the new amount (same number since you started with 0) in the next line.

I would suggest you use Line 199 data since that is the number that gets transferred into other parts of the return.


----------



## Money4life

AltaRed said:


> I may be misunderstanding you, but are you trying to adjust your prior year (2011) T1 return? You don't do that once a return has been filed. You file a T1-ADJ form http://www.cra-arc.gc.ca/E/pbg/tf/t1-adj/t1-adj-12e.pdf in which in Section C, you put in the adjustment you want.
> 
> In your case, you would put:
> - either Line 197 (or Line 199) in the first box (Line number from return or schedule)
> - the name of Line 197 (or Line 199) in the next box
> - 0 for Previous amount in the next box
> - negative sign in the next box
> - the change in the next box (number depending on whether you use Line 197 or Line 199
> - the new amount (same number since you started with 0) in the next line.
> 
> I would suggest you use Line 199 data since that is the number that gets transferred into other parts of the return.


Correct! That's if you want to manually fill out the form and mail it to CRA, right?

I thought the other option was to go online on the CRA website and "change the return" there? I thought someone somewhere in these 11 pages told me that I could do that. Can't find it now. Maybe I've officially lost my mind.


----------



## AltaRed

Money4life said:


> Correct! That's if you want to manually fill out the form and mail it to CRA, right?
> 
> I thought the other option was to go online on the CRA website and "change the return" there? I thought someone somewhere in these 11 pages told me that I could do that. Can't find it now. Maybe I've officially lost my mind.


I thought a T1-ADJ could be done online, and I probably told you that myself, but I've checked that out for my own account and it does not appear that way. My apologies. So it appears you need to file a paper version in order to get that Capital Loss credited.


----------



## Money4life

AltaRed said:


> I thought a T1-ADJ could be done online, and I probably told you that myself, but I've checked that out for my own account and it does not appear that way. My apologies. So it appears you need to file a paper version in order to get that Capital Loss credited.


OK. What do you think the "change my return" part is for then?


----------



## AltaRed

Money4life said:


> OK. What do you think the "change my return" part is for then?


Apparently for purposes other than what you want to accomplish - in this case. I've never changed a prior return online. I have always filed actual T1-ADJ forms.


----------



## warp

Reading all this just confirms what I have said many times on this Forum. 

Our tax system and tax laws are ridiculously complicated , confusing, and just plain stupid.
If filing a tax return is a legal requirement, then every average taxpayer should be able to comprehend our tax laws and be able to complete them with relative ease.

All these posts shows the exact opposite.....that filling in your tax forms causes average Canadians nothing but grief and aggravation. ( although I do my own every year).

Why should anyone have to pay some "tax expert", ( many of whom are clueless themselves), to fill in their tax returns??

Every year I say the same thing........its time for a easy and simple FLAT TAX!....Are you listening Jim Flaherty??

By the way...Jim Flaherty's own wife said the same thing when running for office in Ontario.


----------



## J Watts

I do! I've always done them through UFile although this year I'm trying H&R Block's software.


----------



## whiteknight

I came across SimpleTax in a recent Rob Carrick article. Looks like they are taking on TurboTax and UFile but are free. I'm on a Mac, so I've never been able to use StudioTax.

For the OP, I've done my own taxes every year. With software it really isn't hard and you get a certain DIY satisfaction. I keep a spreadsheet with my trades in a format that matches the Schedule 3. There's also a ton of info on the CRA's website and the internet, so as long as you aren't trying to do something crazy, you can definitely figure it out.

Though I do agree with warp in that, for something we all have to do every year, it should be far simpler.


----------



## MoneyGal

FWIW I'm not in favour of a flat tax. Instead, if I ran the zoo, I'd eliminate many of the targeted tax credits and benefits (i.e., Children's Fitness Tax Credit) in favour of reduced (but still progressive) tax rates overall.


----------



## Eclectic12

warp said:


> ... If filing a tax return is a legal requirement, then every average taxpayer should be able to comprehend our tax laws and be able to complete them with relative ease.
> 
> All these posts shows the exact opposite.....that filling in your tax forms causes average Canadians nothing but grief and aggravation. ( although I do my own every year)...


I'd argue that the posts also show one should learn to walk before they run. Trying to figure out what was done from limited, if not incomplete, data in addition to no experience complicates any issues.


Cheers


----------



## Money4life

So I finally gone ahead and mailed the CRA a T1 Adjustment Form for my capital gains and losses from 2011. Now I can finally focus on 2012 and beyond.

For tax software, I was also eyeing Simpletax. I have a mac so I would prefer to do my taxes in the comfort of my own home. What are the other good options for a mac user?


----------



## Money4life

Eclectic12 said:


> I'd argue that the posts also show one should learn to walk before they run. Trying to figure out what was done from limited, if not incomplete, data in addition to no experience complicates any issues.


I can attest to this first hand!


----------



## Eclectic12

Money4life said:


> For tax software, I was also eyeing Simpletax. I have a mac so I would prefer to do my taxes in the comfort of my own home. What are the other good options for a mac user?


http://en.wikipedia.org/wiki/Comparison_of_Canadian-tax_preparation_software_for_personal_use

Maybe someone else can comment on what they've used on their mac.




Money4life said:


> { ... learn to walk before run/challenges of working from limited info} I can attest to this first hand!


I'm really surprised you weren't given more info ... but I guess the limited info might have convinced you to stick with the "pros". I commend you for your determination as it can seem like a huge task.


Cheers


----------



## warp

MoneyGal said:


> FWIW I'm not in favour of a flat tax. Instead, if I ran the zoo, I'd eliminate many of the targeted tax credits and benefits (i.e., Children's Fitness Tax Credit) in favour of reduced (but still progressive) tax rates overall.


HI MoneyGAl,

There is no reason why we couldn't have progressive tax rates under a FLAT-RATE tax system.
There could easily be rising tax rates on higher income brackets...perhaps 3 in total.

The whole point of a flat tax system, in my opinion, would be to eliminate all these deductions, inclusions, forms, schedules, credits , calculations, reversions, surtaxes, targeted tax breaks, ( used for political purposes), etc, etc etc, that make our tax system ridiculously complicated and idiotic.

There could be a few tax deductions.....personal , one for each child under 18, education amounts, medical costs.
Then you could use several inclusion rates....eg. 50% on capital gains, 75% on rental income, ( to cover aggravation from having to deal with tenants), 90% on interest income,( to cover inflation).

After that, income is income,,period, and you would pay tax on all of it, probably at lower tax rates.

It would be a 2 page return, easy to understand, easy to fill out......and I think it could be easily set up to be revenue neutral for the government.


----------



## RBull

I'm all for simplifying the system. Today's tax system has become ridiculously burdensome and complicated.


----------



## MoneyGal

Ok, but by definition a system with graduated rates is not actually a (true) flat tax system. 

Decent overview here: http://en.wikipedia.org/wiki/Flat_tax

Love Friedman's idea too; see Capitalism and Freedom.


----------



## Hobotrader

I'm all for flat tax...simple, cuts down costs, no need for massive CRA. I'm not looking forward to doing taxes on my own for the first time...I don't even know if FOREX is cap gain/cap loss or income. I work a full time job but the border between cap gain and income is so blurred...A CA told me that you have to choose 1 path and stick with it but the CRA can change it on you whenever based on the gray rules...terrible...Hopefully when I can crack a profit I'll be long out of this country, taxing people on risk (let alone capital) is just wrong lol...


----------



## warp

Hobotrader......
As far as I know, forex, if you must report it, is cap gain/loss.

It is not regular income, which is treated much worse tax-wise.

Also I wouldn't always put much credence on what agents at CRA tell you over the phone....many of them are either clueless, or just plain wrong........another peice of evidence about our insane tax system.


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## AltaRed

That is how I understand it as well.... cap gain/loss.


----------



## My Own Advisor

Regarding tax completion, folks are welcome to enter my giveaway here:
http://www.myownadvisor.ca/2013/02/hr-block-canada-online-tax-program-review-code-giveaway/

I'll have another draw next week and the week after.


----------



## Money4life

So SimpleTax is now NETFILE certified in Canada as of yesterday. I think I'm going to definitely try them out. Anyone else?


----------



## caricole

http://www.studiotax.com/fr/?page=1

100% Free, 

Revenue unlimited

Number of déclarations allowed ...20

100% French or Englisch

Approved for the Federal and Québec incomtax filing

My first try this year, one is mailed, mine will have to wait till Apr 15 (information slips missing)

The "FREE and MAX 20" made me choose and try *"STUDIOTAX"* :encouragement:


----------



## Money4life

The Studiotax design is terrible in comparison to Simpletax. If it wasn't for me going on this forum and reading the positive reviews on Studiotax, I would have discarded it right away. The website looks pretty sketchy at first glance.


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## caricole

Money4life said:


> The Studiotax design is terrible in comparison to Simpletax. If it wasn't for me going on this forum and reading the positive reviews on Studiotax, I would have discarded it right away. The website looks pretty sketchy at first glance.




This reminds me of CHARLOTTE, 16 year old girl (SINGER OF THE DUO Jonathan and Charlottel, runner up on Britain GOT TALENT 2012 when she said.

" iTS LIKE JUDGING A BOOK ON ITS COVER, YOU HAVE TO READ WHAT IS INSIDE...." 

simpletax is not approved for Québec...why should it be, we are not part of Canada, AND NO FRENCH IS AVAILABLE :hopelessness:


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## solncer

My Own Advisor said:


> Regarding tax completion, folks are welcome to enter my giveaway here:
> http://www.myownadvisor.ca/2013/02/hr-block-canada-online-tax-program-review-code-giveaway/
> 
> I'll have another draw next week and the week after.


It says: "Contest is OVER" :upset::upset::upset:


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## jsuter

Hey there! I'm Jonathan, one of the SimpleTax founders.

Money4Life, thanks for the feedback on the design. 

Caricole, sorry we don't support Quebec. We're a small team, so we didn't have time to implement support for NetFile Québec for this year. This is something we're very much considering for next year, along with French language support. As you can imagine, these are both very big features and we want to do them right, rather than recklessly shoving everything in.

We really want to build a product you'll love. Happy to hear any more feedback anyone may have.


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## AMABILE

How do these companies make money,
by allowing us to file for free ?


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## jsuter

AMABILE said:


> How do these companies make money,
> by allowing us to file for free ?


I can't speak for StudioTax (though I do believe they are funded by donation), but SimpleTax makes money by asking users for a small donation before downloading your tax return. You can pay what you want, including zero. We hope that if people love our software, and they can afford it, they will choose to support us. If not, that's fine too.


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## J Watts

Speaking of income tax returns, what's the turnaround looking like this year? The CRA site says 8 business days if everything is correct and direct deposit is elected; how long has it taken everyone else?


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## MoneyGal

I am hearing of one-week turnarounds for efiled returns.


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## J Watts

Just spoke with CRA on an unrelated issue. I net filed Sunday afternoon and by Monday at 4:00pm my return was assessed. The money will have been direct deposited 8 calendar days after filing - great turnaround!


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## Money4life

AltaRed said:


> Those investment gains/losses can thus be ignored and  have nothing to do with Capital Gains/Losses (which would normally show up in a table just above the table you pasted into your post above). So everything is in order EXCEPT to do that T1-ADJ for 2011 to get your Capital Losses  recorded on CRA's books. These capital losses will come in useful in future years when you have some capital gains that you would otherwise have to pay tax on, but which you can now bring forward past year capital losses to help offset that.
> 
> Example: Let's say you have $500 of capital gains in 2014 tax year from something you sold, or some capital gain that is shown on a T3 slip. You can use up some of your accumulated capital losses from Line 127 from previous years (2011 and/or 2012), to partially or totally offset that $500 in capital gains.


So I just received my re-assessment from the CRA. I reported a capital loss of $520 showing them all workings of how I came up with that number and their re-assessment on line 132 under schedule 3 showed that I had a capital loss of $520 and the summary provided by CRA mentioned that I had a net capital loss of $260. 

Is this right? I had a capital loss of $1,040.87 in 2011. On my T1 Adjustment form, I wrote down the number -520 on line 199 in my Schedule 3 form. They shouldn't have taxed my capital loss again at 50% of its value, right?


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## MoneyGal

You normally report the unadjusted loss. The loss is $1040, not $520. The loss of $1040 is reported on your return but only half is taken into account in adjusting your income.


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## Money4life

MoneyGal said:


> You normally report the unadjusted loss. The loss is $1040, not $520. The loss of $1040 is reported on your return but only half is taken into account in adjusting your income.


So how do I rectify this? I did this from the recommendation of AltaRed.


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## MoneyGal

http://www.cra-arc.gc.ca/gncy/cmplntsdspts/ncmtx-eng.html


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## Money4life

MoneyGal said:


> http://www.cra-arc.gc.ca/gncy/cmplntsdspts/ncmtx-eng.html


*sigh* Don't think I can just call them and get it corrected over the phone? Annoying that I have to go through a complaint process.


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## MoneyGal

Nope, it's a paperwork process. Good luck!


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## fraser

We do not do our own tax returns but I do the returns for our daughter and for our son. I like Ufile and buy the basic software package for this.

I would never consider using any of the free or low cost programs where you do it on line. I have absolutely no desire for any third party person to access, intentionally or otherwise, SIN numbers, bank, employers, etc.

I do the returns, then sit on them for a week or so. Then I go back and check for errors and omissions....to the best of my ability. I often pick something up that I had previously overlooked.


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## Money4life

fraser said:


> We do not do our own tax returns but I do the returns for our daughter and for our son. I like Ufile and buy the basic software package for this.
> 
> I would never consider using any of the free or low cost programs where you do it on line. I have absolutely no desire for any third party person to access, intentionally or otherwise, SIN numbers, bank, employers, etc.
> 
> I do the returns, then sit on them for a week or so. Then I go back and check for errors and omissions....to the best of my ability. I often pick something up that I had previously overlooked.


Simpletax has assured that your personal data is safe with them:
http://simpletax.ca/blog/2013/how-we-secure-your-data


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## caricole

*http://www.studiotax.com/en/*

*Revenue Unlimited

20 returns FREE

I do not understand why people should pay for something that is free

1) Download.

2) Do your taxes

3) Print and mail

4) Uninstal studiotax if you are afraid of hacking

Why this marketing on all these expensive softwares that you can get FREE*


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## 6811

caricole said:


> *http://www.studiotax.com/en/*
> 
> *Revenue Unlimited
> 
> 20 returns FREE
> 
> I do not understand why people should pay for something that is free
> 
> 1) Download.
> 
> 2) Do your taxes
> 
> 3) Print and mail
> 
> 4) Uninstal studiotax if you are afraid of hacking
> 
> Why this marketing on all these expensive softwares that you can get FREE*


I have used Turbo-Tax for years for doing an average of 5 to 8 returns for close family. It cost about $70 this year but I consider it well worth it for around $10 per return. 

On first glance Studiotax looks very similar to TurboTax but as a resident of Quebec, working from home for a business in another province, I found that this application program is not nearly so powerful as TurboTax for my situation. Since my province of work is not Quebec, my company only issues a T-4 slip. Turbo tax automatically enters the T-4 and other data into the RL-1 slip section of the application (a releve slip is issued to workers in Quebec as an equivalent to a T-4), Studiotax does not. For the savvy preparer it's a mildly cumbersome manual procedure to enter the information on the RL-1 form in the application but for someone new to doing their own taxes it could be a real problem because Studiotax does not compute the Quebec portion of the return properly. 

A Studiotax trial comparison I just did gave me a correct refund from the Federal return and a smaller refund for the Provincial portion that should have been a several thousand dollar balance owed. 

Guess you get what you pay for.


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## AltaRed

MoneyGal said:


> You normally report the unadjusted loss. The loss is $1040, not $520. The loss of $1040 is reported on your return but only half is taken into account in adjusting your income.


It should not have mattered. It is a matter of quoting the associated line number with the associated loss, i.e. $1040 for Line 197 or $520 for Line 199. It is as simple as that... and CRA should have got that right.

Money4Life: There is no reason to go through the complaint process. Send them a short letter, handwritten even, with a copy of the re-assessment and a copy of the T1-ADJ you sent in simply telling them that they got it wrong. Tell them there is no difference between -$1040 on Line 197 and -$520 for Line 199 and ask them to correct their error. This is clearly a case of a robotic vacant headed data entry clerk forgetting to turn on his/her brain when doing the data entry.


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## MoneyGal

AR: it's all called the "complaint process," even a short handwritten note. I don't have enough info from M4L's post to know how he/she reported the loss.


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## AltaRed

MoneyGal said:


> AR: it's all called the "complaint process," even a short handwritten note. I don't have enough info from M4L's post to know how he/she reported the loss.


I understand....but the term 'complaint process' can mistakenly sound like a rather 'formal' process, when in this case, it does not need to be. I don't know how M4L filled out his T1-ADJ either, but either way, the fix should not be difficult as I suggested.


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## My Own Advisor

Just got my tax refund in the mail tonight. A small one. 1 lump sum payment on the mortgage, coming right up....


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## NorthKC

I do my own taxes using company's tax software as we are allowed to file the tax returns for free. Now, I am an accountant so obviously, I can do the tax return without any issues.


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## pwm

Today at TDW, Gordon Pape was complaining that he was unable to Netfile his return this year. There was an error message at CRA when he transmitted his tax file. He gave up trying to get help from Intuit's help line in India, and CRA was no help, so he finally filed a paper return. 

Not a good endorsement for Turbotax.


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## nathan79

I'll probably continue using paper returns until they're completely phased out. It seems like the various free softwares available are rather inconsistent in terms of features and accuracy. At least if I mess up a paper return it's my own fault. I always double check my calculations using the calculator on taxtips.ca, I've found it pretty accurate.


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## Eclectic12

^^^^^

I always used to mess up the manual calculations. For the few times I haven't used dedicated tax software, the spreadsheet at the following link has worked well for me.
http://www.peeltech.ca/mytax.shtml

I'm able to see the calculations and if I'm happy, the laser printer takes care of the CRA forms.

There's no Quebec form though.


Cheers


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## Eclectic12

Money4life said:


> Simpletax has assured that your personal data is safe with them:
> http://simpletax.ca/blog/2013/how-we-secure-your-data


Maybe ... but unless they are running their servers in house with the appropriate level of expertise - how can one be sure that the "cloud server" aren't outsourced a couple of times and in a completely different country or continent?

It's like my co-worker who was puzzled how he could be working for company A and not have the best training. A few questions later and it was clear company A had outsourced to company B who had outsource to company C, where it was company C he worked for. With two levels selling themselves as cheaper - it's not really a surprise that company A's training program and company C's training program bore little in common.


Cheers


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## jsuter

Eclectic12 said:


> Maybe ... but unless they are running their servers in house with the appropriate level of expertise - how can one be sure that the "cloud server" aren't outsourced a couple of times and in a completely different country or continent?


To answer your question, the physical machines themselves are run by our hosting provider. Yes, we do rely on their operations and physical security, but we believe they have some of the best in the business. We handle the security on the software side of things and monitor things very, very closely.

That blog post is really targeted at a broad audience and only scratches the surface when it comes to security. The important takeaways are that we don't use any kind of public "cloud storage" and we encrypt each row of data individually. The downside is that if someone loses their password, the account is lost with it. On the plus side, that means there is no master key. Worst case scenario—if the server were compromised—the attacker would only have access to the encrypted data. We detail all this in our Privacy Policy. We know there is a lot of trust involved, so that's why we try to be as transparent as possible.

We do use our own product, so we have a vested interest in keeping the data as secure as possible.


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## kcowan

pwm said:


> Today at TDW, Gordon Pape was complaining that he was unable to Netfile his return this year.


Maybe this is a condemnation of Gordon Pape and not TurboTax? At least he waited until after the rush...

Ufile is very clear about when you can Netfile.


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## cainvest

Money4life said:


> Simpletax has assured that your personal data is safe with them:
> http://simpletax.ca/blog/2013/how-we-secure-your-data


Didn't know simpletax saved you data on their system. Can you delete it after you file?

Some friends of mine have been using simpletax, I'll have to let them know about where their data is. I've been using studiotax for a number of years now, works well enough, the price is right and my tax data is local to me.


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## jsuter

cainvest said:


> Didn't know simpletax saved you data on their system. Can you delete it after you file?


You bet. Your data is your data, so you can delete it at any time. You can also complete a return without signing up for an account—if you really don't want your data saved.

Just for the sake of clarity, even though data is saved on our server, there's no way we can access it without your password (i.e. we don't store the raw data as is).


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## cainvest

That's cool, I would think most people wouldn't feel comfortable with that data stored there, even with high security measures in place. I know a few people that won't even bank online!


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