# T5008 is enough for reporting?



## peterk (May 16, 2010)

This is my first year needing to report unregistered capital gains.

I only have 1 unregistered broker and all transactions occur there. Is reporting the numbers provided on the T5008 sufficient? Sometimes I hear you guys talking about itemizing trade transactions somewhere in the forms of your tax returns. This is only needed when there are multiple brokers and/or multi-year transactions and the ACB gets complicated, yes?

In comparison with my ACB spreadsheet, the T5008 is only off by about $10 from what I expected it to be. I suspect the difference is most likely due to currency conversion errors on my part or rounding errors on their part.

I also have a T3 with capital gains, but for a specific mutual fund at different institution, which is quite separate in holdings from any transaction in my unregistered broker account.

So I should just report what's on the slips and move on with life?


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## OnlyMyOpinion (Sep 1, 2013)

So did you actually sell some scurities (stocks, etf, mf, bond, etc.) and have a capital gain or loss?

The T5008 only reports your security sales for the year (it also includes HISA's and possibly other sales that do not have associated gains or losses). You still need to track down the purchase cost of the security you sold last year to determine your net capital gain or loss (hopefully you keep your confirmation slips that are issued at the time you buy or sell).
You report your proceeds, acb and sales commission on Schedule 3 of your tax return.
While I think some tax programs may have the capacity to enter T5008 information, I never do. It is incomplete. I consider it to be 'FYI'. It is not required to be used like entering T3 or T4 slip information.

It sounds like your T3 is reporting cg's from the mutual fund - not the same as the cgs you need to calculate and report in Schedule 3 if you sold securities.


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## AltaRed (Jun 8, 2009)

Ditto to OMO's post. The T5008 does not include Box 20 cost basis data, and if it does, it could be very wrong. Ignore the T5008 ACB data.

Seems to me the $10 sounds suspiciously like either a buying or selling commission for the stock. The OP should know that ACB cost basis includes buying commission, while the selling commission is handled on a separate line on Schedule 3. It is possible the 'disposition' net proceeds shown on the T5008 includes the selling commission. Which discount brokerage did the T5009 come from?


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## peterk (May 16, 2010)

Hmm, thanks gentlemen. But my T5008 from IB _does_ include cost basis box 20, and box 21, and the value it calculates is correct (within $10) to what I know it should be. Looking at the IB breakdown it seems to round the transactions to the nearest dollar, so that may be where the slight discrepancy is, or a currency exchange rate is slightly mis-recorded on my part. Commissions are included and correct for sure.

When I enter the T5008 into the tax software it automatically populates Schedule 3, and autofills in the Name of Fund column with "See T5008 Slip"

Considering this is all correct (all transactions occur at one broker and the ACB they determine is correct) is there an actual requirement to have individual stocks listed with gains or losses on multiple lines of Schedule 3 section 3 filled out? It would all amount to the same result as only showing the T5008...


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## OnlyMyOpinion (Sep 1, 2013)

It sounds like you got it nailed to me. If the software is having Schedule 3 look to T5008 then it should be fine.

As an aside, I'm confused/concerned if IB is providing a "Cost or Book Value" in box 20. They have no way of knowing if their data represents your only position in that security for example (e.g. in another accout elsewhere). Sounds like a recipe for account holders to mess up and hear from the CRA?


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## AltaRed (Jun 8, 2009)

The problem is IB. They are notorious for doing things wrong* with tax slips. NO brokerage should put data in Line 20. That said, it appears in this case, they are close enough to actual to use the T5008 data so that it matches what CRA already knows.

Every different security needs to be on its own line on Schedule 3. Bundling multiple trades of the same security on the same line on Schedule 3 is permissible.

* As an example, it's been reported in another forum that IB uses FIFO for capital gains/losses calculations. That methodology is only permissible in the USA. Canada always uses AVERAGE for ACB data. IB is simply ignorant of Canadian tax law and I don't know how they are permitted to operate the way they do by the regulator.


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## Eclectic12 (Oct 20, 2010)

peterk said:


> ... I only have 1 unregistered broker and all transactions occur there. Is reporting the numbers provided on the T5008 sufficient?


The first typical problem is where the broker leaves the cost blank (i.e. box 20).

The second potential problem is where the cost provided is wrong.

The third potential problem is even if the broker's cost is right, owning the same stock in a different taxable account makes the cost wrong. Note that I don't say "broker" as some have SPP/DRIP programs where a trustee hold the shares instead of a broker.

I use the T5008 as a second source to verify my numbers (except cost, which my broker does not provide).




peterk said:


> ... Sometimes I hear you guys talking about itemizing trade transactions somewhere in the forms of your tax returns. This is only needed when there are multiple brokers and/or multi-year transactions and the ACB gets complicated, yes?


Trade transactions on tax returns? That is the first I have heard of that.

My tracking spreadsheet has the trade transactions as well as any events that affect the cost base (ex. RoC paid or a Canadian ETF paying a re-invested capital distribution aka phantom distribution). This provides the cost base for the capital gain calculation recorded Schedule 3, part 3 of one's tax return.

The T5008 proceeds amount can be compared against the monthly statements and sell confirmation slip. 

Typically what I list on schedule 3, part 3 are each stock stock - with a separate CG line for each one. For example, the largest I can recall is about ten stocks sold in one tax year. The other end of the range is one stock.



peterk said:


> ... In comparison with my ACB spreadsheet, the T5008 is only off by about $10 from what I expected it to be. I suspect the difference is most likely due to currency conversion errors on my part or rounding errors on their part.


Sounds more like the selling commission - that's what made the monthly statements different from my T5008 from what I recall from last year.

If there are currency conversions involved - I would triple check as this is an area that brokers have been demonstrated to be wrong with their numbers versus what the 
investor had recorded as the currency exchange rate at the time of the transactions.



peterk said:


> ... I also have a T3 with capital gains, but for a specific mutual fund at different institution, which is quite separate in holdings from any transaction in my unregistered broker account.


On one hand, the T3 CG is likely for income that won't affect the cost base (more likely for a Canadian ETF).

I seem to recall that filling out the T3 form in the tax software puts the CG on Schedule 3 in a different area than Part 3 where one records the sale of publicly traded investments.


Cheers


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## AltaRed (Jun 8, 2009)

Eclectic12 said:


> On one hand, the T3 CG is likely for income that won't affect the cost base (more likely for a Canadian ETF).
> 
> I seem to recall that filling out the T3 form in the tax software puts the CG on Schedule 3 in a different area than Part 3 where one records the sale of publicly traded investments.


Agreed T3 cap gains is not an adjustment to ACB. It is recorded in the tax year received in a different location. Cap gain adjustments to ACB come in the form or ROC or phantom re-invested distributions for ETFs.


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