Chart 5 – Applying net capital losses of other years to 2023 (for taxpayers with a pre-1986 capital loss balance)
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Chart 5 – Applying net capital losses of other years to 2023 (for taxpayers with a pre-1986 capital loss balance)
Note
The CRA offers a printer-friendly version of this chart that is identical to the one in the PDF version of the Capital Gains guide.
Use this chart to apply your net capital losses of other years to 2023 and to calculate your balance of unapplied net capital losses you can carry forward to a future year.
When you complete this chart, replace "IR" with your inclusion rate for 2000. This rate is from line 16 in part 4 of Schedule 3 for 2000, or from your notice of assessment or latest notice of reassessment for 2000.
Step 1 – Pre-1986 capital loss balance available for 2023
Complete this step only if you have a balance of unapplied net capital losses from before May 23, 1985.
Otherwise, enter "0" on line 3 and go to Step 2.
1. Balance of unapplied net capital losses you had before May 23, 1985
2. Capital gains deductions you claimed:
Before 1988
In 1988 and 1989
From 1990 to 1999
In 2000
From 2001 to 2022
Total capital gains deductions after adjustment
3. Pre-1986 capital loss balance available for 2023 (line 1 minus line 2)
Step 2 – Applying net capital losses of other years to 2023
Complete lines A to C in Step 3 of this chart before proceeding.
4. Total unapplied adjusted net capital losses of other years (total from line C in Step 3)
5. Taxable capital gains from line 12700 of your 2023 income tax and benefit return
6. Enter the amount from line 4 or 5, whichever is less.
7. You can apply all or part of the amount on line 6 against your taxable capital gains in 2023. Enter on line 7 the amount of losses you want to claim.
If you did not complete Step 1, enter the amount from line 7 on line 25300 of your 2023 income tax and benefit return. This is your 2023 deduction for net capital losses of other years. Do not complete lines 8 to 15, and enter this same amount on line 16 in Step 3. However, complete lines D to G in Step 3 of this chart to calculate the balance of unapplied net capital losses available to carry forward to future years.
If you completed Step 1, complete lines 8 to 16 and lines D to G in Step 3 of this chart to calculate the balance of unapplied net capital losses available to carry forward to future years.
8. Balance of unapplied adjusted net capital losses of other years not used to reduce taxable capital gains (line 4 minus line 7)
9. Amount from line 8
10. Amount from line 3
11. Pre-1986 deductible amount
12. Enter the amount from line 9, 10, or 11, whichever is less
13. Deduction in 2023 for net capital losses of other years (line 7 plus line 12). Enter this amount on line 25300 of your 2023 income tax and benefit return and complete Step 3 to calculate the balance of unapplied net capital losses available to carry forward to future years.
Step 3 – Calculating your balance of unapplied net capital losses of other years available to carry forward
14. Amount from line 7
15. Amount from line 12
16. Total adjusted net capital losses of other years applied in 2023 (line 14 plus line 15)
When you complete this table, replace "IR" with your inclusion rate for 2000. This rate is from line 16 in part 4 of Schedule 3 for 2000, or from your notice of assessment or latest notice of reassessment for 2000.
| Before May 23, 1985 | After May 22, 1985, and before 1988 | In 1988 and 1989 | After 1989 and before 2000 | In 2000 | After 2000 and before 2023 | Total | ||
|---|---|---|---|---|---|---|---|---|
| A | Amount of your unapplied net capital losses | not applicable | ||||||
| B | Adjustment factor | 1 | 1 | 3/4 | 2/3 | 1 ÷ (2 × IR) | 1 | not applicable |
| C | (Line A × line B) | |||||||
| D | Total adjusted net capital losses applied against taxable capital gains in 2023 (the total must equal the amount on line 16) | |||||||
| E | (Line C – line D) | * | ||||||
| F | Adjustment factor | 1 | 1 | 4/3 | 3/2 | 2 × IR | 1 | not applicable |
| G | Balance of net capital losses available to carry forward to future years (Line E x line F) | not applicable |
* The total for line E should be equal to the amount shown on your notice of assessment or reassessment for net capital losses of other years available for 2023.
Jerry has unapplied net capital losses of $6,000 he incurred before May 23, 1985. He claimed a capital gains deduction of $500 in 1986 and of $300 in 2000 (Jerry's inclusion rate in 2000 was 2/3 or 66.6666%). Jerry also has the following unapplied net capital losses: $4,000 from 1988 and $6,000 from 1990. He reported a taxable capital gain of $10,000 on line 12700 of his 2023 income tax and benefit return. He completes Chart 5 to calculate the maximum deduction he can claim for his unapplied net capital losses of other years in 2023 and to determine the loss balance that he can carry forward to a future year.
Step 1 – Pre-1986 capital loss balance available for 2023
Complete this step only if you have a balance of unapplied net capital losses from before May 23, 1985. Otherwise, enter "0" on line 3 and go to Step 2.
2. Capital gains deductions you claimed:
Step 2 – Applying net capital losses of other years to 2023
Complete lines A to C in Step 3 of this chart before proceeding.
If you did not complete Step 1, enter the amount from line 7 on line 25300 of your 2023 income tax and benefit return. This is your 2023 deduction for net capital losses of other years. Do not complete lines 8 to 15 and enter this same amount on line 16 in Step 3. However, complete lines D to G in Step 3 of this chart to calculate the balance of unapplied net capital losses available to carry forward to future years.
If you completed Step 1, complete lines 8 to 16 and lines D to G in Step 3 of this chart to calculate the balance of unapplied net capital losses available to carry forward to future years.
Step 3 – Calculating your balance of unapplied net capital losses of other years available to carry forward
When you complete this table, replace "IR" with your inclusion rate for 2000. This rate is from line 16 in part 4 of Schedule 3 for 2000, or from your notice of assessment or latest notice of reassessment for 2000.
| Before May 23, 1985 | After May 22, 1985, and before 1988 | In 1988 and 1989 | After 1989 and before 2000 | In 2000 | After 2000 and before 2023 | Total | ||
|---|---|---|---|---|---|---|---|---|
| A | Amount of your unapplied net capital losses | 6,000 | 0 | 4,000 | 6,000 | 0 | 0 | not applicable |
| B | Adjustment factor | 1 | 1 | 3/4 | 2/3 | 1 ÷ (2 × IR) | 1 | not applicable |
| C | (Line A × line B) | 6,000 | 0 | 3,000 | 4,000 | 0 | 0 | 13,000 |
| D | Total adjusted net capital losses applied against taxable capital gains in 2023 (the total must equal the amount on line 16) | 6,000 | 0 | 3,000 | 3,000 | 0 | 0 | 12,000 |
| E | (Line C – line D) | 0 | 0 | 0 | 1,000 | 0 | 0 | * 1,000 |
| F | Adjustment factor | 1 | 1 | 4/3 | 3/2 | 2 × IR | 1 | not applicable |
| G | Balance of net capital losses available to carry forward to future years (Line E x line F) | 0 | 0 | 0 | 1,500 | 0 | 0 | not applicable |
Jerry has to apply his older losses first. Because the total amount of adjusted losses that he used in 2023 was $12,000 (from line 16 above), he applies $6,000 of his adjusted net capital losses incurred before May 23, 1985, and $3,000 of his adjusted net capital loss incurred in 1988. He then uses $3,000 ($12,000 – $6,000 – $3,000) of his adjusted net capital loss incurred in 1990. Jerry has unapplied net capital losses of $1,500 that he can carry forward to a future year.
* The total for line E should be equal to the amount shown on your notice of assessment or notice of reassessment for unapplied net capital losses of other years available for 2023.
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- Date modified:
- 2024-01-23