Form T657 Calculation of Capital Gains Deduction - Canada

Form T657 Calculation of Capital Gains Deduction in Canada is used to calculate the amount of capital gains deduction that can be claimed on the sale of certain qualified small business corporation shares. The deduction helps to reduce the taxable capital gain on these shares.

Individual taxpayers in Canada who are claiming the capital gains deduction would typically file Form T657 - Calculation of Capital Gains Deduction.

FAQ

Q: What is Form T657?A: Form T657 is used to calculate the Capital Gains Deduction in Canada.

Q: What is the Capital Gains Deduction?A: The Capital Gains Deduction is a tax benefit for individuals in Canada who have realized a capital gain from the sale of qualified small business corporation shares, qualified farm or fishing property.

Q: Who can claim the Capital Gains Deduction?A: Individuals who meet specific eligibility criteria, such as being a Canadian resident, owning qualified shares or property, and meeting ownership and active business use requirements, can claim the Capital Gains Deduction.

Q: What is the purpose of Form T657?A: Form T657 is used to determine the amount of the Capital Gains Deduction that an individual can claim on their tax return.

Q: What information is required on Form T657?A: Form T657 requires information about the individual's shares or property, the proceeds of disposition, the adjusted cost base, and the capital gains deduction limit.

Q: Are there any specific rules or limitations for claiming the Capital Gains Deduction?A: Yes, there are specific rules and limitations, such as the $1,000,000 lifetime limit for the Capital Gains Deduction and the requirement to have a minimum ownership period.

Q: Do I need to submit Form T657 with my tax return?A: No, you do not need to submit Form T657 with your tax return. However, you should keep it for your records in case the CRA requests it for verification.