Canada Revenue Agency
www.cra.gc.ca
Common menu bar links
Example of a completed Chart 5
To return to the previous page use the browser back button
Jerry has unapplied net capital losses of $6,000 he incurred before May 23, 1985. He claimed a capital gains deduction of $500 in 1986 and of $300 in 2000 (Jerry's inclusion rate in 2000 was 2/3 or 66.6666%). Jerry also has the following unapplied net capital losses: $4,000 from 1988 and $6,000 from 1990. He reported a taxable capital gain of $10,000 on line 127 of his 2011 income tax and benefit return. He completes Chart 5 to calculate the maximum deduction he can claim for his unapplied net capital losses of other years in 2011 and to determine the loss balance that he can carry forward to a future year.
| 1. | Balance of unapplied net capital losses you had before May 23, 1985 | $ | 6,000 | 1 | ||||||||
| 2. | Capital gains deductions you claimed: | |||||||||||
| Before 1988 | $ | 500 | ||||||||||
| In 1988 and 1989 | $ | × 3/4 = | + | |||||||||
| From 1990 to 1999 | $ | × 2/3 = | + | |||||||||
| In 2000 | $ | 300 | × [1 ÷ (2 × 2/3)] = | + | 225 | |||||||
| From 2001 to 2010 | + | |||||||||||
| Total capital gains deductions after adjustment | = | $ | 725 |  |
− | $ | 725 | 2 | ||||
| 3. | Pre-1986 capital loss balance available for 2011 (line 1 minus line 2) | = | $ | 5,275 | 3 | |||||||
| 4. | Total unapplied adjusted net capital losses of other years (total from line C in Step 3) | $ | 13,000 | 4 | |||||
| 5. | Taxable capital gains from line 127 of your 2011 income tax and benefit return | $ | 10,000 | 5 | |||||
| 6. | Enter the amount from line 4 or line 5, whichever is less | $ | 10,000 | 6 | |||||
| 7. | You can apply all, or part, of the amount on line 6 against your taxable capital gains in 2011. Enter on line 7 the amount of losses you want to claim | − | $ | 10,000 | 7 | ||||
| If you did not complete Step 1, enter the amount from line 7 on line 253 of your 2011 income tax and benefit return. This is your deduction in 2011 for net capital losses of other years. Do not complete lines 8 to 15 and enter this same amount on line 16 in Step 3. However, complete lines D to G in Step 3 of this table to calculate the net capital losses available to carry forward to future years. If you completed Step 1, complete lines 8 to 16 and lines D to G in Step 3 of this table to calculate the net capital losses available to carry forward to future years. |
|||||||||
| 8. | Balance of unapplied adjusted net capital losses of other years not used to reduce taxable capital gains (line 4 minus line 7) | = | $ | 3,000 | 8 | ||||
| 9. | Amount from line 8 | $ | 3,000 | 9 | |||||
| 10. | Amount from line 3 | $ | 5,275 | 10 | |||||
| 11. | Pre-1986 deductible amount | $ | 2,000 | 11 | |||||
| 12. | Line 9, 10, or 11, whichever is less | + | $ | 2,000 | 12 | ||||
| 13. | Deduction in 2011 for net capital losses of other years (line 7 plus line 12). Enter this amount on line 253 of your 2011 income tax and benefit return and complete the rest of the chart to determine your balance of unapplied net capital losses available to carry forward. | = | $ | 12,000 | 13 | ||||
| 14. | Amount from line 7 | $ | 10,000 | 14 | |
| 15. | Amount from line 12 | + | $ | 2,000 | 15 |
| 16. | Total adjusted net capital losses of other years applied in 2011 (line 14 plus line 15) | = | $ | 12,000 | 16 |
When you complete this table, replace "IR" with your inclusion rate for 2000. This rate is from line 16 in Part 4 of Schedule 3 for 2000, or from your Notice of Assessment or latest Notice of Reassessment for 2000.
| (Do not complete the shaded areas) | Before May 23, 1985 | After May 22, 1985, and before 1988 | In 1988 and 1989 | After 1989 and before 2000 | In 2000 | After 2000 and before 2011 | Total | |
|---|---|---|---|---|---|---|---|---|
| A | Amount of your unapplied net capital losses | 6,000 | 0 | 4,000 | 6,000 | 0 | 0 | |
| B | Adjustment factor | 1 | 1 | 3/4 | 2/3 | 1 ÷ (2 × IR) | 1 | |
| C | (Line A × line B) | 6,000 | 0 | 3,000 | 4,000 | 0 | 0 | 13,000 |
| D | Total adjusted net capital losses applied against taxable capital gains in 2011 (the total must equal the amount on line 16) | 6,000 | 0 | 3,000 | 3,000 | 0 | 0 | 12,000 |
| E | (Line C − line D) | 0 | 0 | 0 | 1,000 | 0 | 0 | * 1,000 |
| F | Adjustment factor | 1 | 1 | 4/3 | 3/2 | 2 × IR | 1 | |
| G | Net capital losses available to carry forward to future years (Line E ×line F) |
0 | 0 | 0 | 1,500 | 0 | 0 | |
Jerry has to apply his older losses first. Because the total amount of adjusted losses that he used in 2011 was $12,000 (from line 16 above), he applies $6,000 of his adjusted net capital losses incurred before May 23, 1985, and $3,000 of his adjusted net capital loss incurred in 1988. He then uses $3,000 ($12,000 - $6,000 - $3,000) of his adjusted net capital loss incurred in 1990. Jerry has unapplied net capital losses of $1,500 that he can carry forward to a future year.
* The total for line E should be equal to the amount shown on your Notice of Assessment or Reassessment for net capital losses of other years available for 2012.
To return to the previous page use the browser back button
