A superficial loss is a capital loss the CRA disallows because you or an affiliated person repurchased the same or identical property within 30 days before or after the sale.
The superficial loss rule stops taxpayers from selling to trigger a loss while keeping the investment. If you, your spouse, or a corporation you control buys back the same or identical property within 30 days before or after the sale, and still holds it at the end of that window, the loss is denied.
The denied loss is not lost forever, it is added to the adjusted cost base of the repurchased property, so it is recognised later when you finally sell for good. The rule commonly catches tax-loss selling near year-end and transfers between personal and registered accounts.
You sell a stock for a $5,000 loss on December 20 and rebuy it on December 28. The loss is superficial and denied, but the $5,000 is added to the ACB of the repurchased shares for use on a future sale.
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Federal tax is the share of income tax that goes to the federal government, charged on taxable income in graduated brackets that are the same everywhere in Canada. Your total bill is that federal amount plus your province or territory's own tax, less the credits you claim. Payroll deductions shown on a T4 cover both layers. Quebec residents receive a refundable abatement of their federal tax because Quebec opted out of certain federal-provincial programs and funds them itself; separately, Quebec also collects its provincial tax through its own return.
Non-taxable income is money you receive that never enters taxable income. Common examples are lottery and most gambling winnings, gifts and inheritances, growth and withdrawals inside a TFSA, the GST/HST credit and Canada child benefit, most life insurance death benefits, and child support under current-rule agreements. A few amounts are reported and then deducted, such as workers' compensation and social assistance, because they still affect benefit calculations, so report anything that arrives on a slip even when no tax results.
Start with total income from every source for the year, including employment, self-employment, investments and pensions. Subtract the deductions you qualify for, such as RRSP contributions, child care costs, union dues and deductible employment expenses, to reach net income. Take off any further deductions that apply at the next stage, losses carried forward among them, and what remains is taxable income, the figure the brackets are applied to. Credits reduce the tax calculated on that figure rather than the income itself.
Open the forms and publications section of canada.ca, search by form number or title, and choose the PDF for the tax year you need, because forms change from year to year and prior-year versions stay available in the same place. Most personal filers need no printed forms at all, since software approved for NETFILE builds the T1 and transmits it. Paper filers should print the version for their province or territory of residence.
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Reviewed and fact-checked by Udit Gupta
Ex Big 4 — Ernst & Young, Deloitte · International & cross-border tax specialist · CPA Canada (In-Depth Tax Program) · Chartered accountant, ICAI & MIA
Udit Gupta has over 15 years of experience helping corporations and business owners with corporate structuring, corporate tax filing, bookkeeping, payroll, GST/HST, cross-border tax and CRA representation. Big 4 trained at Ernst & Young and Deloitte, and qualified as a chartered accountant in India and again in Malaysia, he founded his accounting practice in 2014 to serve entrepreneurs, startups and non-resident business owners across Canada. View full member bio.
The Institute of Chartered Accountants of India — member 521458 · Malaysian Institute of Accountants — member CA 44667 · Ex Big 4: Ernst & Young, Deloitte · CPA Canada (In-Depth Tax Program), completed 19 Dec 2023 · In-Depth GST/HST Part I, 12 Jul 2022 · Part II, 5 Jul 2023
Editorial policy. Every page is researched against primary sources — the Income Tax Act, CRA publications and CPA Canada guidance — and every rate or threshold is stated with the tax year it applies to.
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