Step 2 - Total income

Step 2 - Total income

Income you earned that was not reported on an information slip must still be reported on your tax return.

Amounts that are not reported or taxed

You do not have to report certain non-taxable amounts as income, including:

• lottery winnings of any amount, unless the prize can be considered income from employment, a business or property, or a prize for achievement

• most gifts and inheritances

• amounts paid by Canada or an allied country (if the amount is not taxable in that country) for disability or death of a war veteran due to war service

• the GST/HST credit (and related provincial and territorial credits and benefits), CCB (and related provincial and territorial benefits) and CCR

• family allowance payments and the supplement for handicapped children paid by the Province of Quebec

• compensation received from a province or territory if you were a victim of a criminal act or motor vehicle accident

• most amounts received from a life insurance policy following someone's death

• most types of strike pay that you received from your union, even if you performed picketing duties as a requirement of membership

• amounts that are exempt from tax under the Indian Act (for more information, go to canada.ca/section87-tax-exemption)

• most amounts received from a TFSA

Reporting foreign income and other foreign amounts

Report, in Canadian dollars, your foreign income and other foreign currency amounts (such as expenses and foreign taxes paid).

In general, the foreign currency amount should be converted using the Bank of Canada exchange rate in effect on the day that the amount arises. In certain situations, the CRA will accept an exchange rate quoted by another source other than the Bank of Canada if the rate is:

• widely available

• verifiable

• published by an independent provider on an ongoing basis

• recognized by the market

• used in accordance with well-accepted business principles

• used to prepare financial statements (if any)

• used consistently from year to year

Each of the conditions above must be met for the rate to be accepted. Other sources of foreign exchange rates that the CRA generally accepts include rates from Bloomberg L.P., Thomson Reuters Corporation, and OANDA Corporation.

In certain circumstances, an average of exchange rates over a period of time may be used to convert foreign currency amounts. See Income Tax Folio S5-F4-C1, Income Tax Reporting Currency. Also refer to this folio for information about converting foreign amounts generally.

For more information about converting foreign income taxes paid, see Income Tax Folio S5-F2-C1, Foreign Tax Credit.

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