Should RRSP and TFSA Transactions be Included when Calculating ACB?

You may own the same security in both your non-registered account and registered accounts (TFSA, RRSP, RRIF, RESP, and RDSP accounts).  As discussed, adjusted cost base should be calculated jointly when an identical security is owned in multiple non-registered accounts.

Transactions in registered accounts should not be considered when calculating ACB.  Securities in registered accounts are not subject to capital gains tax (and similarly, capital losses in a registered account cannot be used to offset capital gains in a non-registered account).  When the same security is owned in both a registered account and a non-registered account, transactions within the registered account have no affect whatsoever on the ACB and capital gains for the security in the non-registered account.

However, although the transactions in a registered account are not factored in directly to ACB, a transaction in a registered account can trigger the superficial loss rule for a transaction in a non-registered account.  Therefore, it’s still important to pay attention to the dates of transactions in a registered account when transactions for the same security occur during a similar time frame in a non-registered account.

26 thoughts on “Should RRSP and TFSA Transactions be Included when Calculating ACB?

  1. Km0m

    My broker transferred some shares of a REIT from my non-registered account to my RRSP account to make my annual contribution. Is it possible to track this using your ACB tools? If so how?

  2. Km0m

    My broker also transferred another equity, all shares, from my non-registered US trading account to my non-registered CAD trading account. Does this same rule apply? Do I treat it as a sell with a superficial loss?

  3. Km0m

    Since it is a transfer between personal accounts, how do I enter it? Do I enter it as a sell using the currency exchange, and then start it again as a new security? But the ACB would be all screwed up then.

  4. AdjustedCostBase.ca

    Km0m,

    Assuming that the stocks were transferred in-kind between your own non-registered account, you would not need to enter any transaction. There would be no affect on ACB and no capital gain or loss would be triggered.

  5. Ignac Vucko

    I have read that the superficial loss rule will apply if you sell a security in non-registered account but buy it from a registered account within the 61 day window. As such, while ACB for registered accounts don’t strictly need to be calculated, trade dates for securities that are in common between non-registered and registered accounts must be tracked.

    If this is correct, I think this FAQ answer should be modified to specifically mention this.

    Thanks

  6. Km0m

    Thanks for the heads-up. I made the correction today following acb directions regarding editing this type of transaction and I cancelled the loss when the security was sold and transferred to my registered account.

  7. Andy

    Hi,
    Could a person have a superficial loss within a registered account like RRSP when they eventually withdraw the money? Let’s say a person sells a stock in RRSP at a loss, and then a week later buys that same stock in a non-registered account, holding it for over 30 days.

  8. AdjustedCostBase.ca

    Andy,

    It doesn’t matter whether or not a loss within an RRSP account is superficial or not. Either way, the loss cannot be claimed. And in any case the loss cannot be re-added to the ACB of shares purchased in a non-registered account.

  9. F L

    Would you recommend AdjustedCostBase.ca be used to track RRSP, TFSA transactions for the purpose of tracking capital transactions and investments – portfolio tracking / trade journal usage?

  10. AdjustedCostBase.ca Post author

    F L,

    Although you’re free to do so, AdjustedCostBase.ca is not designed to be a portfolio tracking solution. It is only intended to calculated capital gains and losses on deemed dispositions. It does not support calculating rates of return or portfolio performance, nor does it handle unrealized gains or losses or calculation of total return including distributions.

  11. Phil

    Presuming that equity withdrawn from a TFSA occurs at its FMV and establishes a new ACB, if the equity drops in value and is subsequently sold at a loss, does it create a capital loss that could later be used to offset a capital gain? Would deeming provisions be triggered in the case where the amount of money originally invested is less than the loss? Example – cash inside a TFSA purchased stock at $1/share and increased to $5/share before it was withdrawn. After being withdrawn, if the stock dropped to zero, the value of the capital loss would be less than the amount originally paid.

    Thanks!

  12. zasid

    this sound all so complex do you have any blog post series like for beginner investor to understand this tax madness in Canada like from AtoZ at a beginner level like a 5yr could understand I have met with accountant who did my taxes last year and he asked me to ACB on my RRSP shares and charged me for it and now in your article it says ACB Is not require in registered account am so so so confused feels like he took advantage of me of not knowing this.

  13. AdjustedCostBase.ca Post author

    Phil,

    Yes, a capital loss would occur in that scenario (provided that the superficial loss rule does not apply). The fact that the original purchase price is higher than the final selling price has no impact.

  14. rick

    I hold Dorel in both my TFSA and margin accounts, my ACB in my margin is $4.20 and stock is around $26 as they are paying a special dividend of $12 U.S at close on Feb1 so a big cap gain if i sell so:-
    TFSA hold until close on Feb 1 at lets say $26 so the divi goes into my TFSA avoiding tax, the shares will not “price adjust” until market opens Feb 2 so transfer to margin account before open at $26 which will boost my ACB, market opens divi comes off the price at lets say $16 CDN and stock trades below my new ACB, sell to claim a tax loss and wait 30 days then buy back in TFSA thus avoiding the tax on the divi i would have to pay if i moved it now to my margin to boost my ACB , i create extra TFSA room for 2023and i get a tax loss, am i correct and allowed to do this? Thank you

  15. AdjustedCostBase.ca Post author

    Rick,

    While the Dorel special dividend had a record date of January 18, 2022, the shares are now trading with “due bills” meaning that the right to receive the dividend is still attached to the shares:

    https://www.dorel.com/blogs/news/dorel-completes-sale-of-sports-segment-to-pon-holdings-for-us-810-million-and-declares-special-dividend-of-us-12-00-per-share

    I think this means that the dividend would be deposited into your non-registered account if the shares are transferred before February 2.

    It might be feasible to transfer the shares out of your TFSA at the higher price and still receive the dividend inside your TFSA. For example, as a result of delays in processing the transfer or due to flexibility allowed by your brokerage in selecting the share price as yesterday’s closing price. However, you would risk running afoul of the CRA’s “advantage rules.” This reminds of the TFSA swap schemes that lead to swap transactions being disallowed a few years ago:

    https://financialpost.com/personal-finance/taxes/the-swap-scheme-that-led-to-a-forty-fold-increase-in-one-womans-tfsa

    https://www.canada.ca/en/revenue-agency/services/tax/technical-information/income-tax/income-tax-folios-index/series-3-property-investments-savings-plans/series-3-property-investments-savings-plan-folio-10-registered-plans-individuals/income-tax-folio-s3-f10-c3-advantages-rrsps-rrifs-tfsas.html

  16. rick

    Thank you. I called Dorel investor relations and the divi goes into my TFSA after close today (Feb.1), as you explain their will be a delay in adjusting the stock price to allow for the divi (about $16 CDN) until the market opens tomorrow , so early tomorrow my broker would give me the closing price from today and that way the divi goes to the TFSA avoiding tax, i get the higher stock price in my margin account to increase my ACB but my concern too is the CRA will disallow it, worst case i think is they will say the ACB of the shares i move from my TFSA will be the price they open at on Feb.2nd which will still be a lot higher than my current $4.20 ACB, do you feel that is the worst case too?

  17. AdjustedCostBase.ca Post author

    Rick,

    Per the link above the CRA may impose a tax of 100% on the advantage received. Also, if the FMV of the transferred shares gets reduced then your available TFSA contribution room would decrease. If you’ve already filled that room based on the higher share value then you would end up over-contributing to your TFSA.

  18. Tim

    Thank you for the great site and tools, especially on the premium side. I do have one last thing I can’t wrap my head around though.

    I bought shares of the same company in both my non registered account and my TFSA, but the non registered account is by far the larger amount of shares. It is as follows:

    TFSA:
    March 11, buy 8 shares
    April 13, buy 1 share
    May 27, buy 2 shares
    October 18, sell all 11 shares in TFSA

    Non registered:
    March 11, buy 1,084 shares
    43 transactions, both buying and selling, sometimes reaching 13,000 shares held, until Aug 4.
    August 5, sell all shares in non registered account

    Is the full loss in the non registered account a superficial loss because of the whopping 11 shares in the TFSA?

    Any insight is appreciated.
    Thanks!

  19. AdjustedCostBase.ca Post author

    Tim,

    In the scenario where shares are purchased and fully sold in a non-registered account, with shares remaining in a registered account, it’s unclear to me whether the remaining shares in the registered account would trigger the superficial loss rule. The shares in the registered account are clearly a separate pool of shares, so it would seem that these remaining shares would not qualify as repurchased shares, but on the other hand I’m not aware of any clear guidance on this.

    But if the superficial loss rule does apply, it would likely not have a significant impact in your case if you use the CRA’s rules for partial superficial losses:

    https://www.adjustedcostbase.ca/blog/applying-the-superficial-loss-rule-for-a-partial-disposition-of-shares/

    In particular if you sold 13,000 shares with 11 shares remaining in your registered account, then at most only a small fraction of the loss (11/13,000) would be superficial

  20. Tim

    Thank you for the input, I have currently used the partial superficial loss on some of the sales in the non registered account. When doing so I have not carried the ACB forward on any of them, is that how you think it should be done as well?

    And then to make it more complicated, when finding the min of S, P, or B for the formula, is S only that specific sale? I ask because across those months and 43 transactions I have 15 sales.

    This leads to me having scenarios where in one day I sold 1,900 shares in one transaction and can claim a partial loss because the shares at the end of the period was 1,300. But then I also sold another 1,200 shares that same day and as it is less than the 1,300 at the end of the period, and less shares than bought in the period, I can’t claim any loss.

    Thanks again for your input and time.

  21. AdjustedCostBase.ca Post author

    Tim,

    The denied loss can be added to the ACB in the case where shares are repurchased in a non-registered account. But in cases where the shares are repurchased in a registered account (such as an in-kind transfer from a non-registered to a registered account) then the superficial loss is permanently denied, and cannot be added back to your ACB in your non-registered account.

    I’m not sure how the formula should be applied in cases where there are multiple sales and purchases occurring in a superficial loss period.

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