I’m filing a T2 for a HoldCo. I’ve already reported T5008 dispositions on Schedule 6, and I’ve reported both the T5008 gains and the T3 Box 21 taxable capital gains on Schedule 125 (GIFI).
TaxCycle is pulling capital gains into Schedule 7 only from Schedule 6, so the T3 Box 21 amount isn’t included in Schedule 7.
Also the Eligible portion of taxable capital gains in S7 is calculated (Blue).
What’s the correct way to get T3 Box 21 included in Schedule 7 without creating a dummy Schedule 6 disposition or overriding the amount calculated there?
For the proper amount of capital gains to show up on Schedule 7, you need to report the gains of your T5008 and the gains on the T3 on Schedule 6. The total in the GIFI schedule should then be the same as Schedule 6 and Schedule 7.
I usually add a line like “per 202x T3 CIBC”
Thanks. I thought about that, but my concern is that Schedule 6 is meant to report actual dispositions by the corporation (proceeds/ACB/outlays).A T3 Box 21 amount is a trust-allocated taxable capital gain, not a disposition by the corporation, so putting it on Sch 6 can look like the corp sold a capital property that it didn’t.
I also considered overriding the Schedule 7 amount, but that feels like a workaround too .I’m wondering if there’s a more technically correct way to have T3 Box 21 flow into Schedule 7 in TaxCycle without creating a notional disposition.
Assuming your HoldCo either owns units of a mutual fund or is the beneficiary of a Family Trust or Testamentary Trust that legally holds the capital property, the holdings ARE capital property. The only way it would not be capital property (as far as I can think…) is if your HoldCo is actively trading - that is, the income would be considered BUSINESS income - fully taxable, rather than as capital gains.
