# Reporting T5008/RL18 details...?



## Sixth_Circle

We received a T5008/RL18 trading summary from our investment advisor, and I understand that this information must be reported on a Schedule 3. I'm just not sure what needs to be reported and what goes where.

For example, say we have the following trades listed for our joint non-registered account:

TCN - Transfer in kind ETF shares to TFSA ($xx PROCEEDS)
SEL - Sold ETF shares ($xx PROCEEDS)
BUY - Bought ETF shares ($xx COST)
*Questions:*
1. The form states that SELL transactions are reportable to CRA, but also states transfers-in-kind to TFSAs "may be reportable". That's too vague. How do I know if or when these must be reported?
2. If shares were bought at various times, what do you use for the acquisition date? For example, bought 250 in 2011 for x price, 350 in 2012 for x price, then transferred or sold 500 in 2013?
3. Our advisor is fee-based (viridian) and thus no commissions or trading fees, at least none specific to any particular trade. How do you calculate outlays and expenses? 

Thanks for any guidance.


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## Spudd

1. The form states that SELL transactions are reportable to CRA, but also states transfers-in-kind to TFSAs "may be reportable". That's too vague. How do I know if or when these must be reported?

They must be reported if you transferred them to the TFSA at a higher cost than you bought them for. You report this as a capital gain. 

2. If shares were bought at various times, what do you use for the acquisition date? For example, bought 250 in 2011 for x price, 350 in 2012 for x price, then transferred or sold 500 in 2013?

You can leave acquisition date blank (it's an optional field). This is what I did for ones where I had multiple acquisition dates.

3. Our advisor is fee-based (viridian) and thus no commissions or trading fees, at least none specific to any particular trade. How do you calculate outlays and expenses? 

No idea, sorry.


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## Eclectic12

For Schedule 3, likely part 3 "Publicly traded shares, mutual fund units ...", the info needed is:
Number of shares/units, Name of fund/corp & class of shares, year of acquisition, proceeds, adjusted cost base & disposition expenses.

Two things for the ACB ... on Schedule 3, this is the ACB for all shares (some writers/sites mean ACB per share which is different). 

Secondly, I've seen errors by my broker in the "book value" column so I'd go back to the buy/sell slips (or the monthly statements) to calculate the book value myself. This is likely critical for the ETF if it is paying RoC as part of the distributions as I highly doubt the broker is including reducing the ACB (or book value) by the RoC portion of the payments. Even if the ETF or investment does not pay RoC, I like to have an independent verification.

The proceeds - ACB - disposition costs will end up with either a capital gain (positive number) or capital loss (negative number). The loss is applied to any gains that tax year. If the overall is a capital loss, the loss can be carried back three years or carried forward until there is a capital gain to use it against.


For #1 ... +1 for that it has to be reported. It is a deemed sale where even though you still own it, it is treated as if you sold and contributed cash.
Just remember that if it was transferred at a capital loss, you can't claim the loss.


For #2 ... I use the year of the first purchase. I like to see exactly what's happened in case a couple of years have passed before looking at it again, so in the year I bought/sold Blackberry three times, I recorded three lines on Schedule 3, section 3 with the same year of acquisition and each capital gain/loss for the buy/sell pairs. 

Others have posted here that they prefer a summary, so they use the data of the first acquisition and the total proceeds from all three buy/sell pairs, the total ACB and the total disposition expenses. 


For #3 ... If this is anything like my mom's fee based advisor, the monthly statements when the buy/sell happens lists the commission to buy/sell. So check your statements as you may be paying commissions despite the fee. If so, you will need to correctly add the buy cost to the ACB and record the sell cost in the Schedule 3, part 3 disposition expenses (i.e. outlays and expenses).

For her - the commissions are taken out of the lump sum she placed with them. If you can't find it on the monthly statements or whatever reporting they provide, I'd call them to ask as they likely have a flat amount.


Cheers


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## Guban

2. I use the last purchase date. I think CRA is looking for superficial losses. Otherwise, does this date really matter to them?


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## Eclectic12

^^^^

Interesting ... I was thinking it was to give them the ability to quickly scan the historical share price range and compare possible scenarios.


Cheers


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## AltaRed

Guban said:


> 2. I use the last purchase date. I think CRA is looking for superficial losses. Otherwise, does this date really matter to them?


I have typically either used the earliest date, or the date of the biggest purchase. Your point is a good one, but wouldn't CRA already know that from the T5008 data that the financial institutions submit to CRA anyway?


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## Eclectic12

I don't receive a T5008 form so maybe someone who does can confirm if the buy transactions are recorded on this form.

The closest description of a box that might record buy transactions seems to be boxes 22, 23 & 24 "Securities received on settlement (if applicable)", where the description says:


> In some securities transactions, securities are received as proceeds of disposition.


So AFAICT - there aren't any buy transactions being recorded on this form. 

http://www.cra-arc.gc.ca/tx/bsnss/tpcs/slps/fnncl/t5008/t5008slp/cmpltng/bxs/menu-eng.html


Even if they were - it likely would depend on how long a history CRA's computers keep as for some of my stocks, it's been years since I bought so that the current tax year form or annual trading summary won't have a buy entry.


Cheers


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## AltaRed

Whether the broker puts the information on a T5008 or simplly calls it the Annual Trading Summary, buys and sells are reported to CRA.


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## Sixth_Circle

Thanks for the replies and discussion, it's appreciated. Our returns have historically been very basic; things like ACBs can get heady and complex for those of us who are unaccustomed.


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## Eclectic12

There's a good link in the "How Investment Taxes Work" sticky in this section. Or usually a book on investing or taxes will have a chapter that includes some sample calculations.

It is the simple case for a stock but when you google, there are several good articles outlining the differences for a MF or ETF or REITs. CRA has a good walk through of the calculations for a MF but not so good for explaining it, IMO.


I'd suggest learning about it at your own pace as the issue I see with being dependent on others is that it is difficult to catch any problems without understanding the requirements/calculations. If found that if I took my time and learned a bit at a time - I later was wondering why I didn't learn it earlier plus why I thought it was so mysterious and difficult.

At the end of the day, it is identifying which calculations happen when, how to record it and multiplication/addition/subtraction (not difficult math!).


Cheers


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