Entrepreneurship & Small Business

Need help reporting capital gains on T2

  • Last Updated:
  • Jul 24th, 2017 10:40 am
Newbie
Jun 22, 2017
2 posts

Need help reporting capital gains on T2

Guys, I really your help on this. I've been struggling with this for days.

How do I report capital gains on T2's balance sheet? I just can not find any GIFI codes for capital gains. I completed a schedule 6 and it's included as Taxable capital gains on my schedule 1.

I know I should be getting help from a professional accountant and I'm looking for one. If anyone has any recommendations for good ones in the Brighton area, I would really appreciate it. Thanks.
6 replies
Deal Addict
Aug 19, 2013
2397 posts
1091 upvotes
A gain goes on your income statement. And an accounting gain is different then a taxable capital gain. Instead of trying to figure it out go see an accountant.

The basics. It doesn't go on your balance sheet. The asset will be removed from the balance sheet. The accounting gain gets reported on yor incoem statement. On the T2S1 you deduct the gain on the income statement and add your taxable capital gain.
Again best to get someone who knows what they are doing to do this.
Newbie
Jun 22, 2017
2 posts
Thanks for the response! I haven't had much luck finding a good corporate account in my area, but I will keep looking.

Based on your feedback, if I made $500 on stocks, I count this as capital gain and report it on my income statement. But I DO NOT include it under net income for my balance sheet? Then the money is missing from my total retained earnings...sorry I know I should be going to a professional for this, I'm just trying to figure out as much as I can in the mean time.
Deal Addict
Aug 19, 2013
2397 posts
1091 upvotes
Batman599 wrote: Thanks for the response! I haven't had much luck finding a good corporate account in my area, but I will keep looking.

Based on your feedback, if I made $500 on stocks, I count this as capital gain and report it on my income statement. But I DO NOT include it under net income for my balance sheet? Then the money is missing from my total retained earnings...sorry I know I should be going to a professional for this, I'm just trying to figure out as much as I can in the mean time.
You are thinking about it all wrong. It gets included in income on the income statement. The final net income from your income statement gets added into retained earnings at year end. You don't add or subtract individual amounts. I can tell from your questions that you do not have a good grasp on basic accounting so please stop trying to figure it out on your own and just go hire someone. You will cause yourself more problems if you are not keeping proper records for a corporation (which include double entry bookkeeping) and if report things for taxes incorrectly. You will pay more for someone to fix the mess
Sr. Member
Jan 18, 2017
607 posts
527 upvotes
AB
So there are 3 moving parts here:

Sch125: You're going to show your NET capital gain(loss) as a line item in the revenue section of the schedule.

Sch6: You're going to show your total proceeds received on the sale(s), less the original ACB of the investment(s), which will calculate your TAXABLE net gain/loss. This needs to flow through to the S1.

Sch1: There is going to be two parts here: (1) The first part is where you remove the net S125 gain/loss. (2) Second part is where you include the Sch 6 taxable gain/loss.

It's a bit tricky getting all the parts to flow together correctly. For complicated stuff I generally recommend talking to a tax guy.
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MR CROSSBORDER KNOW IT NOTHING, but ready to spew forth. (Also a CPA)
Member
Jun 25, 2011
336 posts
117 upvotes
Alberta
crossborderguy wrote: So there are 3 moving parts here:

Sch125: You're going to show your NET capital gain(loss) as a line item in the revenue section of the schedule.

Sch6: You're going to show your total proceeds received on the sale(s), less the original ACB of the investment(s), which will calculate your TAXABLE net gain/loss. This needs to flow through to the S1.

Sch1: There is going to be two parts here: (1) The first part is where you remove the net S125 gain/loss. (2) Second part is where you include the Sch 6 taxable gain/loss.

It's a bit tricky getting all the parts to flow together correctly. For complicated stuff I generally recommend talking to a tax guy.
Dude you should be teaching accounting. This simple concept is way overly complicated by many people but you really explained in layman term for others.
Sr. Member
Jan 18, 2017
607 posts
527 upvotes
AB
Thanks, appreciate it. I've humoured the thought of teaching a night course or something similar (I have a regular practice to run during the day), but I worry that I would get in trouble for just ignoring the textbook and teaching accounting properly. Academics get involved and needlessly complicate things. How they manage to write 800+ pages on Intro Accounting is astounding.
albertaguy wrote: Dude you should be teaching accounting. This simple concept is way overly complicated by many people but you really explained in layman term for others.
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MR CROSSBORDER KNOW IT NOTHING, but ready to spew forth. (Also a CPA)

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