Reserves on dispositions of capital property
You have made a capital gain and you are claiming a reserve on
the capital gain. We recommend that you read the chapter,
"Claiming a reserve" in Guide T4037
Capital gains.
To know the rules for this reserve, you may visit the following
link:
https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/t4037.html
Also review Form T2017 Summary of Reserves on Dispositions of
Capital Property, which you can find at the following link:
https://www.canada.ca/en/revenue-agency/services/forms-publications/forms/t2017.html
For Quebec residents, please visit the following link
https://www.revenuquebec.ca/en/online-services/forms-and-publications/current-details/in-120-v/
Please read Part 5 of the guide IN-120.
When you sell an asset, you must declare it in your tax return
and to do this, follow these steps:
1 - On the "Left side menu on the Interview
tab", select the "Interview setup";
2 - On the screen on your right, go to the "Investment
income and expenses" group, check the
box »Capital gains (or losses) and capital gain
history" and click "Next" at the bottom
of the page;
3 - Go back to the "Left side menu on the Interview
tab" and select the "Capital Gains (or losses)
& ABIL" and the screen on your right choose your
option;
4 - In this case, you can choose "Real estate,
depreciable property, and other properties" then enter the
relevant information and on the line "Reserve on
disposition" enter the amount of the reserve which may not
exceed 80%.
Refer to Schedule 3 of the Tax Return. See line 19700
total capital gains and the reserves on line 19200. The program
will generate Form T 2017 Summary of Reserves on Dispositions of
Capital.
For Quebec residents, the program will generate Schedule G
and the amount of the reserve will be entered on line 32 while the
capital gain will be on line 44.
If you use the software the following year, the reserves on
dispositions will be carried forward to the following year.
If you need help, you can contact the CRA at the following
telephone number 1-800-959-8281.
ID: 20191217163234IB.xml
Webpage: KPA330-20191217163234IB.htm
