# Multiple trade entries for capital gains



## AllanP (Mar 2, 2011)

I do 300 or more trades in the year. Royal Bank's Direct Investing gives me a form with all the trades along with the total indicated profit or loss. I use Ufile (on line) to do my taxes. Is there a way to just enter the gain or loss; or do I have to fill in every stock that I purchased? The form asks for the security and dates. I think I simplified it last year, but just don't want to be red flagging Revenue Canada.


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## Eclectic12 (Oct 20, 2010)

AllanP said:


> I do 300 or more trades in the year. Royal Bank's Direct Investing gives me a form with all the trades along with the total indicated profit or loss. I use Ufile (on line) to do my taxes. Is there a way to just enter the gain or loss; or do I have to fill in every stock that I purchased? The form asks for the security and dates. I think I simplified it last year, but just don't want to be red flagging Revenue Canada.


Since these are stocks/bond type investments, when you look at Schedule 3 on the tax form, you will see sections for capital gains (or Losses) with one section for stocks, another for bonds and another for real estate. Each section includes separate lines for *each* stock/mutual fund/trust unit/bond/ real estate property sold.

So - if you bought 100 shares of RIM on Jan 14th and another 100 on July 22nd and sold 200 shares on Dec 2nd. You will have to calculate the Adjusted Cost Base on your own. On the tax form, you will to report the number sold (200), Name of the corporation/class of share, year of acquisition, ACB that you calculated across all shares applied to the number of shares sold and expenses to end up calculating either a capital gain or loss for that sale.

This is repeated across each sale of shares.

So as a partly true/partly fictional example for 2010 is:
1) first sale of RIM (sold half in Feb)
2) second sale of RIM (sold remainder in June)
3) sale of stock B
4) sale of stock C
5) sale of stock D
6) deemed sale of trust units by transferring to TFSA
(transferring investments to a tax sheltered account is treated the same as selling).


So of your 300+ trades, if 250 are sales - your tax return schedule 3 will have 250 entries - with the final capital gain or loss as the total of the 250 entries, possibly spread across a couple of categories.

Note that a buy will be used in calculating the ACB but won't be reported on the tax return. 

This is why the schedule says "Attach a separate sheet of paper if you need more space".

Likely setting this up in a spreadsheet will help. This is also why people will buy software like Quicken to record/keep up with all of this.

Some links to help:

Capital Gains/Loss calcuations
http://www.cra-arc.gc.ca/tx/ndvdls/...tng-ncm/lns101-170/127/clc-rprt/menu-eng.html

ACB calculations
http://www.cra-arc.gc.ca/E/pub/tg/t4037/

Blogs on ACB calcuations
http://canadianfinanceblog.com/2009/08/19/how-to-calculate-your-adjusted-cost-base-acb.htm
http://www.ndir.com/SI/funds/03242002.shtml
Return of Capital and ACB calcuations
http://www.milliondollarjourney.com/how-return-of-capital-works.htm


Unless you did a lot of buying with little selling, you have a fair amount of reading and calculating ahead of you.

So it is a good news/bad news situation. The good news is that once the calculations are understood, the math is relatively simple. The bad news is that from the sounds of it, there are a lot of separate calculations to do - where you may have to do some digging to find the information.

I discovered after a painful time finding the information required that it makes life a lot easier to record all this stuff as each transaction happens.

Cheers


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## atrp2biz (Sep 22, 2010)

I'm not sure if the response addressed the OP's question. I have the same question. In the past, I simply attached a printout of transactions of an account and entered the "account" capital gains into UFile. Of course I would only include transactions for those securities that initiated a gain or loss (sold in tax year) and would use ACB. I agree that manually entering transactions of each security would be incredibly tedious and this cannot be the only way to do this.

Thoughts?


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## Eclectic12 (Oct 20, 2010)

atrp2biz said:


> I'm not sure if the response addressed the OP's question. I have the same question. In the past, I simply attached a printout of transactions of an account and entered the "account" capital gains into UFile. Of course I would only include transactions for those securities that initiated a gain or loss (sold in tax year) and would use ACB. I agree that manually entering transactions of each security would be incredibly tedious and this cannot be the only way to do this.
> 
> Thoughts?


Hmmmm ... is there a difference between attaching a printout of the "capital gain/loss" transactions and entering the sum total on schedule 3 versus doing the same for each stock on schedule 3? Or am I missing something?

In fact, since most tax software I've used lets you insert additional lines to handle additional stocks and does the math for you, I suspect that you are adding extra work.


In any case, to focus on the original question:


> Is there a way to just enter the gain or loss; or do I have to fill in every stock that I purchased?


The Canada Revenue Agencies (CRA) tax form (i.e. Schedule 3) specifically asks for the number/name of the shares. If CRA has asked for it, I'd be leery of providing a grand total without attaching the details. If you put yourself in the CRA agent's shoes - if the brokerage has reported say 100 sales and the tax form has only one entry, it would attract attention.

Bottom line is if you want to do something different, call CRA.


As for manually entering transactions being tedious and not the only way - it depends on what you mean. 

For the tax form, my understanding is that what is required is the capital gains/loss calculation for each stock sell transaction - not the individual transactions (example - buy the same stock five times and sell twice = two capital gains calculation on schedule 3).

For the transactions and calculation of the ACB - this is a "cost of doing business". 

It is up the investor to keep tabs on what's been bought, how it changes the ACB and where return of capital (RoC) has been paid, deducting the RoC portion from the ACB.


Cheers


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