Line 25400 - Capital gains deduction
Line 25400 - Capital gains deduction
If you have capital gains arising from the disposition of qualified farm or fishing property (QFFP) or qualified small business corporation shares (QSBCS), you may be eligible for a capital gains deduction to reduce your taxable income.
Use Form T657, Calculation of Capital Gains Deduction, to calculate the capital gains deduction.
If you have investment income or expenses in any year from 1988 to 2025, you will also have to complete Form T936, Calculation of Cumulative Net Investment Loss (CNIL) to December 31, 2025.
You can choose to claim any amount of eligible capital gains to deduct in a year, up to the maximum allowable amount.
If a reserve was claimed in a prior year and it relates to a disposition of capital property that was a QFFP or QSBCS, the maximum amount of the capital gains deduction that you can claim is based on the year that the property was disposed of. This also applies to any taxable capital gain allocated and designated to you by a trust that had claimed a capital gains reserve on a disposition of QFFP or QSBCS in a prior year of the trust.
For more information, go to canada.ca/line-25400.
