The Money Pocket · 1-page PDF-ready sheet
Canada Capital Gains Cheat Sheet
Inclusion rate, ACB math, superficial-loss rules, and carryback windows — the CRA rules you actually need at tax time.
Updated October 9, 2026 · themoneypocket.com
The inclusion rate
Only 50% of a capital gain is taxable in Canada — you add half the gain to your income and it’s taxed at your marginal rate. The proposed increase to a two-thirds inclusion rate was cancelled in March 2025, so 50% applies to all gains.
| Proceeds of disposition | $30,000 |
| Adjusted cost base (ACB) + selling costs | − $18,000 |
| Capital gain | $12,000 |
| Taxable capital gain (50%) | $6,000 added to income |
Estimate yours with the Canada capital gains tax calculator.
Adjusted cost base (ACB)
- ACB = purchase price + commissions and other acquisition costs.
- For identical properties (the same stock or ETF bought at different times) use the average cost: total cost of all units ÷ units held. Each sale uses the average at that moment.
- Reinvested distributions and return-of-capital adjust the ACB — keep your T3/T5 slips.
- Track it with the ACB calculator.
Superficial loss rule
A capital loss is denied if you (or an affiliated person, such as your spouse or a corporation you control) buy the identical property within 30 days before or after the sale and still own it 30 days after the sale. The denied loss is added to the ACB of the replacement property, so it’s deferred — not lost forever.
Using capital losses
- Net capital losses offset taxable capital gains only (not salary), except in the year of death.
- Carry back up to 3 years (Form T1A) or carry forward indefinitely.
- Plan which years to apply losses with the capital loss planner.
Exemptions worth knowing
| Principal residence exemption | Gain on your home can be fully exempt. You must report the sale and designate the property on Schedule 3 (and Form T2091 if not every year is covered). Formula: (1 + years designated) ÷ years owned × gain. Try the PRE calculator. |
| Lifetime capital gains exemption | $1,250,000 for qualified small business corporation shares and qualified farm or fishing property (dispositions after June 24, 2024). |
| TFSA | Gains inside a TFSA are tax-free; losses inside it can’t be claimed. |
Crypto
The CRA treats cryptocurrency as a commodity. Selling, trading one coin for another, or spending crypto is a disposition. Frequent trading can be business income (100% taxable) rather than capital gains — the CRA looks at frequency, holding period, and intent.
Reporting checklist
- Report dispositions on Schedule 3; carry the taxable amount to line 12700.
- Reconcile against T5008 and T3 slips — slips often show cost as unknown or wrong.
- Keep purchase records for six years after the year you file.
- Filing and balance-due deadline: April 30 (June 15 filing for self-employed, but payment is still due April 30).
Sources: Income Tax Act (Canada) s. 38, 40, 54, 111; CRA guide T4037; Department of Finance announcement of March 21, 2025. Informational only — confirm with the CRA or a Canadian tax professional.