Category Archives: Advanced ACB Topics

Calculating Capital Gains with Incomplete Records

In order to accurately calculate adjusted cost base and capital gains a complete history of all transactions is required, including not only purchases and sales, but also reinvested distributions, return of capital, phantom distributions, and splits.  A common and unfortunately occurrence is when a Canadian investor has owned a security for a long time, has […]

Calculating Capital Gains on Redemptions of Bonds and Preferred Shares

Often preferred shares are issued with conditions allowing the issuer to redeem the shares after a certain date for a predetermined price (the issuer has the option to redeem the shares, but not the obligation).  Preferred shares can also have a predetermined maturity date, whereby the issuer has the obligation to redeem the shares on […]

Capital Gains and Losses for In-Kind Contributions to Registered Accounts

An in-kind contribution to a registered account is where shares are transferred directly into the account, as opposed to cash.  When making an in-kind contribution to a registered account (such as an RRSP or TFSA), it’s possible for a capital gain to be realized, even if the shares are transferred directly.  Even though you haven’t […]

Order of Transactions for Calculating Adjusted Cost Base

When calculating adjusted cost base, it’s important to use the correct ordering of the transactions.  In some cases it may not matter – for example, in a sequence of multiple buy transactions, the order within that sequence will not affect the final result.  But where buy transactions are interlaced with sell transactions, the order matters. […]