The ISAs is in U.S. dollars and earns 3.90%. While this is a deposit product and typically doesn’t generate capital gains, it appears the taxpayer sold or redeemed units at a price different from the book value, which triggered a realized gain.
These gains were not reported on a T5008, so I’ve manually entered them on Schedule 3 of the T1 (see below).
That would be the appropriate procedure for ANY gain not otherwise reported. Typically the T5008s only report gains of which the holding party/broker is aware. They aren’t always aware.
I noticed a blank T5008 slip in the Non-Registered Account Year-End Resource Package. Following it is a “Securities Transactions Details” document showing two investment savings accounts where box 20 (cost) equals box 21 (proceeds). Since these are investment savings accounts, I assume the blank T5008 with no amounts does not need to be entered in the T1?
Non-Registered Account Year-End Resource Package contains, Two T5’s, Realized Gains and Losses report, and T5008 (no amounts - mentioned above).
Client provided two official T5 tax slips.
However, regarding the realized gains and losses report in package, could I request the client obtain an official tax document, as well? The first page of Non-Registered Account(s) Year-End Resource Package states, “The information displayed within these reports is not an official record of your account or official tax documents.”
I’m always amazed that the year end packages include a T5008 with the owner’s name/address, SIN or BN, but no numbers. I keep investment records going back to the time of the Ark. Brokers often get the cost wrong, especially if there’s been any ROC. Any ROC is a reduction in cost, not income. Or, an individual rolls his personal investments to his investco on a tax deferred basis, and the broker records the “new” cost as the market price at the transfer date, and that’s wrong. For any investco, the last page of the financial statements is a schedule of investments, reconciling the opening balance with the closing balance, using the correct cost base, and a final column with market value. Client can see at a glance that his Nortel shares aren’t coming back. When I do a T1 or T2, I download CRA’s version of the T5008’s and compare each to the actual numbers, changing them as needed. Sometimes there’s a ton of transactions, so I download slips as an Excel file, and work with them in Excel. Never have had a question from CRA. Might be overkill, but I like things done right.
I would like to know if others are in agreement with the following:
If T5008 slip contains no information or amounts no need to report it on T1
Manually enter the realized gains from these Investment Savings Account (ISA) transactions based on the realized gains and losses report on Schedule 3 of the T1 tax return, as noted in the original post.
