Whether you are claiming losses or gains, having investments or a rental property can make your return more complex. With seven days to go before the deadline, here are seven tips for investors looking to make a claim:
- Your principal residence has a capital gains exemption, but if you move out and start renting it out, part of the gain may be taxable when you sell it.
- If you realized a profit or loss on a non-registered investment, you need to report it on a Schedule 3. You can carry capital losses back three years or forward indefinitely until you can use them.
- You need to have the right records and paperwork to calculate your capital gains and losses accurately.
- Dividends from Canadian corporations receive beneficial tax treatment, so make sure you understand the Dividend Tax Credit.
- If you over-contributed to your RRSP by more than $2,000, you will be subject to a penalty tax. However, if you withdraw the excess amount you can claim an offsetting deduction against the amount you have to include in income.
- You can donate stocks or shares directly to a charity to avoid the capital gain and receive a receipt to make the claim on your return.
- You cannot claim capital expenses for a rental property until you sell it. Then it reduces your capital gain.
Any of these seven tips can help save you a few tax dollars and get your return in on time. And with only seven days to go, these become even more useful as the deadline clock ticks down.