# Superficial Loss rule



## Contrast2 (Nov 2, 2014)

Hi everyone, this year I will be filing my taxes for capital gains (well loss in my case) for the very first time, I have tracked everything on an excel spreadsheet and have calculated everything. I would simply like to confirm whether or not any of my transactions would break the superficial tax loss rule. From what I've learned myself about the rule I would think not, but I'd like a second opinion before I go to the tax man. The following are all my losses (except in CVE's case I initially had a gain and then a loss in separate transactions). If someone can help me figure out whether any of these transactions break the superficial loss rule it would be much appreciated. 

10/27/2014	Buy	200	$26.77	$9.95	$5,363.95	200 *CVE*
10/28/2014	Sell	100	$27.65	$9.95	$2,681.98	100	$73.08 
10/28/2014	Sell	100	$27.51	$9.95	$0.00	0	$58.58 
*+ 131.66*

11/4/2014	Buy	200	$27.35	$9.95	$5,479.95	200 *CVE*
12/9/2014	Buy	200	$25.10	$9.95	$10,509.90	400 
12/11/2014	Sell	400	$23.43	$9.95	$0.00	0	*-$1,147.85* 



12/3/2014	Buy	300	$54.00	$9.95	$16,209.95	300 *DOL *
12/9/2014	Sell	200	$53.17	$6.64	$5,403.32	100	-$179.27 
12/9/2014	Sell	100	$53.16	$3.31	$0.00	0	-$90.63 
*-$269.90* 

12/4/2014	Buy	200	$47.84	$9.95	$9,577.95	200 *ACQ*
12/19/2014	Buy	200	$40.32	$9.95	$17,651.90	400 
12/22/2014	Sell	400	$42.35	$9.95	$0.00	0	*-$721.85* 


10/28/2014	Buy	100	$27.26	$4.97	$2,730.97	100 *HSE*
10/28/2014	Buy	100	$27.27	$4.98	$5,462.95	200 
11/4/2014	Buy	100	$26.66	$6.63	$8,135.08	300 
11/4/2014	Buy	50	$26.66	$3.32	$9,471.40	350 
12/11/2014	Sell	350	$22.92	$9.95	$0.00	0	*-$1,459.35* 


11/4/2014	Buy	700	$6.10	$9.95	$4,279.95	700 *SGY*
12/9/2014	Buy	700	$4.33	$9.95	$7,320.90	1400 
12/11/2014	Sell	1400	$4.00	$9.95	$0.00	0	*-$1,730.85* 


11/24/2014	Buy	350	$56.83	$9.95	$19,899.44	350 *TD*
12/9/2014	Sell	350	$54.96	$9.95	$0.00	0	*-$672.90*


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## AltaRed (Jun 8, 2009)

I did not check the mathematical answers but no superficial loss issues in methodology in that group. The key is NOT to buy back the same security within 31 days of declaring a loss.


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## Guban (Jul 5, 2011)

AltaRed said:


> I did not check the mathematical answers but no superficial loss issues in methodology in that group. The key is NOT to buy back the same security within 31 days of declaring a loss.


Within 30 days before or after the sale that results in a loss.

http://www.taxtips.ca/personaltax/investing/taxtreatment/shares.htm


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## Contrast2 (Nov 2, 2014)

AltaRed said:


> I did not check the mathematical answers but no superficial loss issues in methodology in that group. The key is NOT to buy back the same security within 31 days of declaring a loss.


What about in CVE's case? Because that's the only stock that I re-bought after selling it entirely within 31 days, although my first transaction was a capital gain and a loss thereafter. All the other transactions I think are okay because I bought them and sold all at once.


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## AltaRed (Jun 8, 2009)

Contrast2 said:


> What about in CVE's case? Because that's the only stock that I re-bought after selling it entirely within 31 days, although my first transaction was a capital gain and a loss thereafter. All the other transactions I think are okay because I bought them and sold all at once.


You are fine because all your sells were all cap gains before you bought the second time. Had one or both been losses, you would have been into superficial losses.


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## mrPPincer (Nov 21, 2011)

Guban is right. Directly from CRA..


> What is a superficial loss?
> When you dispose of property for a loss, and you or a person affiliated with you, acquires it within the month before or after the sale.


http://www.cra-arc.gc.ca/tx/ndvdls/...tng-ncm/lns101-170/127/lss-ddct/menu-eng.html


EDIT.. Correction.. further research at CRA and I see AltaRed is right too, you are ok after all..
CRA seems to conflict what I quoted above at this location;
http://www.cra-arc.gc.ca/tx/ndvdls/.../lns101-170/127/lss-ddct/sprfcl/menu-eng.html


> What is a superficial loss?
> 
> A superficial loss can occur when you dispose of capital property for a loss and:
> 
> ...


(bolding mine)

So as long as you didn't own shares or options to buy any of them within 30 days after the sale the losses won't be superficial.


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## AltaRed (Jun 8, 2009)

Ouch! 

I had always assumed it was only AFTER the sale of the property, i.e. re-purchase within 30 days after the capital loss triggered by the sale. I've never heard of a situation where someone buys stock X at Price Y and then resells it all, for example, 15 days later at Price (Y minus some number).

That situation makes no sense.


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## mrPPincer (Nov 21, 2011)

If they DID own shares within 30 days after selling, then this (what I deleted from my above post) would still hold true:



> Sorry to say, but looks like..
> 
> The 200 shares of CVE purchased Dec.9 and sold on Dec.11 are a superficial loss (the 200 purchased on Nov.4 are not).
> Same with the 300 shares of DOL, and the 400 ACQ.
> ...


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## mrPPincer (Nov 21, 2011)

I agree it makes no sense, way too overly complicated..


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## techcrium (Mar 8, 2013)

AltaRed said:


> I did not check the mathematical answers but no superficial loss issues in methodology in that group. The key is NOT to buy back the same security within 31 days of declaring a loss.


What if you sold a security in a non-registered account for a tax loss and then on the same day, bought back the security in your TFSA?


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## Contrast2 (Nov 2, 2014)

http://www.adjustedcostbase.ca/blog/what-is-the-superficial-loss-rule/

^ I read that a while ago and he clears up a lot of things, I think what might be working in my favour is that I sold all my shares and not a partial amount. This is what he says about fully sold shares: 



> How about when shares and bought, and then fully sold immediately after? Can a capital loss be claimed in this case? As long as all the shares a sold, and you don’t repurchase the shares within the 30-day period following the sale’s settlement date, you can claim a capital loss. Remember that two conditions must apply for the superficial loss rule: shares must be bought within the 61-day period, AND, some shares must still be owned at the end of the period. In the case where all shares are sold (and nothing’s repurchased) the superficial loss rule does not apply as long as you don’t own any shares at the end of the 61-day period.
> 
> Again, this is assuming that you’re trading on capital account. A high trading frequency and short holding period could result in your transactions being considered on income account (see above).


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