{"id":165,"date":"2014-05-08T22:26:55","date_gmt":"2014-05-09T02:26:55","guid":{"rendered":"http:\/\/www.adjustedcostbase.ca\/blog\/?p=165"},"modified":"2026-01-26T15:49:00","modified_gmt":"2026-01-26T20:49:00","slug":"tax-breakdown-service-for-etfs-and-trusts-from-cdsinnovations-ca","status":"publish","type":"post","link":"https:\/\/www.adjustedcostbase.ca\/blog\/tax-breakdown-service-for-etfs-and-trusts-from-cdsinnovations-ca\/","title":{"rendered":"Tax Breakdown Service for ETF&#8217;s and Trusts from CDSInnovations.ca"},"content":{"rendered":"<blockquote><p>AdjustedCostBase.ca now offers a streamlined method for importing phantom distribution and return of capital transactions for many exchange traded funds (ETF&#8217;s), publicly traded mutual funds, income trusts and real estate investment trusts (REITs).\u00a0 <a href=\"https:\/\/www.adjustedcostbase.ca\/blog\/streamlined-import-of-return-of-capital-and-phantom-distributions-and-for-exchange-traded-funds-etfs-publicly-traded-mutual-funds-and-trusts\/\">Learn more about this feature.<\/a><\/p><\/blockquote>\n<p>When you own exchange traded funds (ETF&#8217;s), trusts, or other kinds of publicly traded funds, your brokerage should provide with a T3 slip every year showing the tax breakdown of the distributions that were paid out.\u00a0 The information contained on the T3 slip is vital for completing your tax return as well as for updating your adjusted cost base balances.<\/p>\n<p>However, it may not always be prudent or rely on your brokerage to send you this information for the following reasons:<\/p>\n<ul>\n<li>If you own multiple funds your brokerage may send you a single T3 slip covering all distributions for all the funds.\u00a0 This is problematic because your adjusted cost base needs to be calculated separately for each security you own.\u00a0 For example, if you&#8217;ve received distributions in the form of return of capital, you need to know the allocation of return of capital for each security for adjusted cost base to be correctly calculated.<\/li>\n<li>On occasion incorrect information may be reported on a T3 slip.<\/li>\n<li>T3 slips can get sent out very late in the tax season.\u00a0 They are only required to be sent out by March 31st.\u00a0 Many brokerage will wait until this deadline to mail them out even if the necessary information is available before then.<\/li>\n<li>Non cash distributions (also known as reinvested capital gain distributions or a phantom distribution&#8221;) are not specified on T3 slips.\u00a0 Not factoring this information into your ACB calculations will result in too much tax being paid.<\/li>\n<\/ul>\n<p>A solution to these issues is to access an online service provided by CDS Innovations Inc.\u00a0 They provide the tax breakdown of all Canadian public mutual funds and limited partnerships.\u00a0 This includes all ETF&#8217;s and income trusts.\u00a0 The data is provided in the form of Excel spreadsheets that list the breakdown of the distributions per unit.\u00a0 By using this service you&#8217;ll usually be able to access the information sooner (most funds\/trusts will release their tax breakdown information before the end of February) and ensure that everything is accurately recorded.<\/p>\n<p>Tax breakdowns are usually provided by ETF providers and trusts on their web sites.\u00a0 However, this information can be difficult and cumbersome to track down.\u00a0 CDS Innovations Inc. provides everything in one place.<\/p>\n<p>The tax breakdown service from CDS Innovations Inc. can be accessed here:<\/p>\n<p>2025 and beyond:\u00a0 <a title=\"CDS Innovations Inc. Tax Breakdown Posting\" href=\"https:\/\/ctbsext.posttrade.cds.ca\/ctbsExt\/\" target=\"_blank\" rel=\"noopener\">CDS Innovations Inc. Tax Breakdown Posting<\/a><br \/>\n2024 and earlier: <a title=\"CDS Innovations Inc. Tax Breakdown Posting\" href=\"https:\/\/services.cds.ca\/taxforms\/index.html\" target=\"_blank\" rel=\"noopener\">CDS Innovations Inc. Tax Breakdown Posting<\/a><\/p>\n<p><a href=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/cds_innovations_screenshot.png\" data-rel=\"lightbox-image-0\" data-rl_title=\"\" data-rl_caption=\"\" title=\"\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-166\" src=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/cds_innovations_screenshot.png\" alt=\"CDS Innovations Inc. Screenshot\" width=\"783\" height=\"681\" srcset=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/cds_innovations_screenshot.png 783w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/cds_innovations_screenshot-300x260.png 300w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/cds_innovations_screenshot-624x542.png 624w\" sizes=\"auto, (max-width: 783px) 100vw, 783px\" \/><\/a><\/p>\n<p>Unfortunately the securities are not listed by ticker symbol so it can sometimes be hard to find the one you&#8217;re looking for.\u00a0 To access the data click on the Microsoft Excel file icon in the &#8220;Form&#8221; column.<\/p>\n<p>As an example, let&#8217;s look at the T3 tax form for XDV (&#8220;ISHARES DOW JONES CANADA SELECT DIVIDEND INDEX FUND&#8221;) for 2013.\u00a0 When you first open it up in Microsoft Excel, you may see the following warning about enabling macros:<\/p>\n<p><a href=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/excel_enable_macros.png\" data-rel=\"lightbox-image-1\" data-rl_title=\"\" data-rl_caption=\"\" title=\"\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-168\" src=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/excel_enable_macros.png\" alt=\"Microsoft Excel Enable Macros\" width=\"1044\" height=\"391\" srcset=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/excel_enable_macros.png 1044w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/excel_enable_macros-300x112.png 300w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/excel_enable_macros-1024x383.png 1024w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/excel_enable_macros-624x233.png 624w\" sizes=\"auto, (max-width: 1044px) 100vw, 1044px\" \/><\/a><\/p>\n<p>You will need to click on the &#8220;Enable Content&#8221; button to enable macros (the file is from a trusted source).\u00a0 After macros are enabled you should see the following:<\/p>\n<p><a href=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/XDV_t3.png\" data-rel=\"lightbox-image-2\" data-rl_title=\"\" data-rl_caption=\"\" title=\"\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-170\" src=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/XDV_t3.png\" alt=\"XDV T3 Form\" width=\"2134\" height=\"990\" srcset=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/XDV_t3.png 2134w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/XDV_t3-300x139.png 300w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/XDV_t3-1024x475.png 1024w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/XDV_t3-624x289.png 624w\" sizes=\"auto, (max-width: 2134px) 100vw, 2134px\" \/><\/a><\/p>\n<p>This forms shows the tax breakdown of the distributions for XDV for 2013 broken down for each distribution.\u00a0 Many of the rows, such as Actual Amount of Eligible Dividends (49) and Foreign Business Income (24) are immediately taxable for the current year and must be reported on your tax return.<\/p>\n<p>The following rows are relevant towards tracking your ACB and reporting capital gains:<\/p>\n<ul>\n<li>Total Non Cash Distribution ($) Per Unit<\/li>\n<li>Capital gain (21)<\/li>\n<li>Return of Capital (42)<\/li>\n<\/ul>\n<p>The <strong>&#8220;Total Non Cash Distribution ($) Per Unit&#8221;<\/strong> is a distribution that has not been distributed as a cash dividend.\u00a0 Rather, it has been reinvested in the fund.\u00a0 This is also known as a &#8220;Reinvested Capital Gains Distribution&#8221; or a &#8220;Phantom Distribution&#8221; (since the funds are reinvested but the unitholders do not receive any additional units).\u00a0 These amounts should be added to your ACB.\u00a0 Since this type of distribution results in an increase in ACB, it has the effect of reducing your capital gain when the units are eventually sold.\u00a0 So if you ignore these distributions, you&#8217;ll end up paying more capital gains tax than you need to.\u00a0 The amount is shown as a per unit value, so you&#8217;ll need to multiply it by the number of units you own.\u00a0 Non cash distributions are often paired with a capital gains distribution of equal value.<\/p>\n<p>A <strong>&#8220;Capital gain&#8221;<\/strong> distribution occurs when a dividend is paid out but it&#8217;s taxed as a capital gain.\u00a0 This can occur when a fund sells holdings, resulting in a capital gain, and this capital gain is distributed to unit holders.\u00a0 The capital gain must be reported on your current year&#8217;s tax return (it should appear in box 21 of your T3 slip).\u00a0 A capital gain distribution does not affect ACB.<\/p>\n<p>Finally, a <strong>&#8220;Return of Capital&#8221;<\/strong> distribution is cash that&#8217;s returned to unit holders but isn&#8217;t immediately taxable.\u00a0 ACB should be reduced by the amount of the return of capital distribution.\u00a0 Since ACB is reduced, this has the effect of increasing your capital gain once the units are eventually sold.\u00a0 If you fail to account for a return of capital distribution, you&#8217;ll be evading taxes.<\/p>\n<p>The distributions for the year are each listed separately.\u00a0 For the case of XDV in 2013, there were 12 monthly distributions.\u00a0 If you made no purchases or sales of XDV for the year (i.e., the number of units owned as constant throughout the year) you can simply sum up the total annual amounts for each row.\u00a0 Otherwise, you should calculate each month separately.\u00a0 Pay close attention to the &#8220;Record Date&#8221; row for each distribution.\u00a0 Each distribution applies to a unit if and only if the unit was owned on the &#8220;Record Date.&#8221;<\/p>\n<p><a title=\"AdjustedCostBase.ca\" href=\"https:\/\/www.adjustedcostbase.ca\/\">AdjustedCostBase.ca<\/a> supports the tracking of ACB and capital gains for the distribution types mentioned above.\u00a0 Below is an example of how to enter the distribution for December 31, 2013 (distribution #12):<\/p>\n<p><a href=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/XDV_distribution_12.png\" data-rel=\"lightbox-image-3\" data-rl_title=\"\" data-rl_caption=\"\" title=\"\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-174\" src=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/XDV_distribution_12.png\" alt=\"XDV Distribution #12\" width=\"582\" height=\"515\" srcset=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/XDV_distribution_12.png 582w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/XDV_distribution_12-300x265.png 300w\" sizes=\"auto, (max-width: 582px) 100vw, 582px\" \/><\/a><\/p>\n<p>In this case the distribution contains a capital gain and an eligible dividend distribution.\u00a0 These would appear on the T3 slip you receive from your brokerage and would be included in your tax return for the current year.\u00a0 The distribution also has a non cash component and a return of capital component.<\/p>\n<p>Let&#8217;s assume that 1,100 shares of XDV are owned on the record date of December 31, 2013, with a total ACB of $27,570.<\/p>\n<p>The <strong>&#8220;Total Non Cash Distribution ($) Per Unit&#8221;<\/strong>\u00a0 and\u00a0<strong>&#8220;Capital gain&#8221;<\/strong> components can be entered jointly as a &#8220;Reinvested Capital Gains Distribution&#8221; transaction as follows:<\/p>\n<p><a href=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/reinvested_capital_gains_distribution.png\" data-rel=\"lightbox-image-4\" data-rl_title=\"\" data-rl_caption=\"\" title=\"\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-175\" src=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/reinvested_capital_gains_distribution.png\" alt=\"Reinvested Capital Gains Distribution\" width=\"1234\" height=\"349\" srcset=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/reinvested_capital_gains_distribution.png 1234w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/reinvested_capital_gains_distribution-300x84.png 300w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/reinvested_capital_gains_distribution-1024x289.png 1024w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/reinvested_capital_gains_distribution-624x176.png 624w\" sizes=\"auto, (max-width: 1234px) 100vw, 1234px\" \/><\/a><\/p>\n<p>Since no new units were issued, enter 0 for the &#8220;Additional Shares Purchased\/Received&#8221; field.\u00a0 The distribution amount is specified as $0.11827 as shown on the T3 form from CDSInnovations.ca.\u00a0 This has the affect of <em>increasing<\/em> the total ACB by:<\/p>\n<pre>  1,100 units x $0.11827\/unit\r\n= $130.10<\/pre>\n<p>Next, the <strong>&#8220;Return of Capital&#8221;<\/strong> transaction must be accounted for as a &#8220;Return of Capital&#8221; transaction type:<\/p>\n<p><a href=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/return_of_capital.png\" data-rel=\"lightbox-image-5\" data-rl_title=\"\" data-rl_caption=\"\" title=\"\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-177\" src=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/return_of_capital.png\" alt=\"Return of Capital Transaction\" width=\"1233\" height=\"312\" srcset=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/return_of_capital.png 1233w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/return_of_capital-300x75.png 300w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/return_of_capital-1024x259.png 1024w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/return_of_capital-624x157.png 624w\" sizes=\"auto, (max-width: 1233px) 100vw, 1233px\" \/><\/a><\/p>\n<p>The amount is entered as $0.00382 per share as shown on the T3 form.\u00a0 This has the affect of <em>decreasing<\/em> the total ACB by:<\/p>\n<pre>  1,100 units x $0.00382\/unit\r\n= $4.20<\/pre>\n<p>You must also account for the other 11 transactions for the year, although the rest of the transactions do not have a non-cash or capital gain component.<\/p>\n<p>Let&#8217;s assume that the following purchases were made for XDV:<\/p>\n<ul>\n<li>Initially buy 1,000 shares for $25.00 on January 2, 2013 with a $10 commission.<\/li>\n<li>Buy 100 shares for $25.50 on July 10, 2013 with a $10 commission.<\/li>\n<\/ul>\n<p>The complete list of transactions for XDV for 2013 would appear on AdjustedCostBase.ca as follows after entering all 12 distributions:<\/p>\n<p><a href=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/transactions_for_XDV.png\" data-rel=\"lightbox-image-6\" data-rl_title=\"\" data-rl_caption=\"\" title=\"\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-180\" src=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/transactions_for_XDV.png\" alt=\"Transactions for XDV\" width=\"1220\" height=\"565\" srcset=\"https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/transactions_for_XDV.png 1220w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/transactions_for_XDV-300x138.png 300w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/transactions_for_XDV-1024x474.png 1024w, https:\/\/www.adjustedcostbase.ca\/blog\/wp-content\/uploads\/transactions_for_XDV-624x288.png 624w\" sizes=\"auto, (max-width: 1220px) 100vw, 1220px\" \/><\/a><\/p>\n<p>If the number of units owned was constant throughout the year, we could have combined the 12 return of capital transactions into one.\u00a0 Since the number of units was constant for the first 6 return of capital transactions they could be combined into one (ditto for the last 6).<\/p>\n","protected":false},"excerpt":{"rendered":"<p>AdjustedCostBase.ca now offers a streamlined method for importing phantom distribution and return of capital transactions for many exchange traded funds (ETF&#8217;s), publicly traded mutual funds, income trusts and real estate investment trusts (REITs).\u00a0 Learn more about this feature. When you own exchange traded funds (ETF&#8217;s), trusts, or other kinds of publicly traded funds, your brokerage [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[],"class_list":["post-165","post","type-post","status-publish","format-standard","hentry","category-tax-tools-and-resources"],"_links":{"self":[{"href":"https:\/\/www.adjustedcostbase.ca\/blog\/wp-json\/wp\/v2\/posts\/165","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.adjustedcostbase.ca\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.adjustedcostbase.ca\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.adjustedcostbase.ca\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.adjustedcostbase.ca\/blog\/wp-json\/wp\/v2\/comments?post=165"}],"version-history":[{"count":33,"href":"https:\/\/www.adjustedcostbase.ca\/blog\/wp-json\/wp\/v2\/posts\/165\/revisions"}],"predecessor-version":[{"id":1590,"href":"https:\/\/www.adjustedcostbase.ca\/blog\/wp-json\/wp\/v2\/posts\/165\/revisions\/1590"}],"wp:attachment":[{"href":"https:\/\/www.adjustedcostbase.ca\/blog\/wp-json\/wp\/v2\/media?parent=165"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.adjustedcostbase.ca\/blog\/wp-json\/wp\/v2\/categories?post=165"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.adjustedcostbase.ca\/blog\/wp-json\/wp\/v2\/tags?post=165"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}