Tax Slips | Frequently Asked Questions FAQs
Learn about Tax Slips Frequently Asked Questions
If a change of address was made before tax slips were issued, will the slips be sent to the correct address?
- Registered Accounts: If the address change is made before the contribution receipts are processed, the receipt will be sent to the new address. For all other tax slips, the change must be made before January 6 for the slips to be sent to the correct address.
- Non-Registered Accounts: The address change must be completed before January 6 for the slips to be sent to the correct address. T3/RL-16/NR4 and T5013/RL-15 tax slips are issued based on the residence code and address on file as of February 29.
Does a client need to file a new income tax return if they receive an amended tax slip?
No, the client does not need to file a new return. They should submit a T1-ADJ (T1 Adjustment Request) to the CRA along with the amended slip. Quebec residents should submit a TP-1.R-V (Request for an Adjustment to an Income Tax Return) to Revenu Québec. Alternatively, they can send a signed letter with the details of the adjustment request, their SIN, and the amended tax slip to their tax center.
My client’s residential address is outside Canada, but they received a tax slip for Canadian residents. Why?
Tax slips are issued based on the residence code attached to the client’s account as of January 6. If the residence code was set to Canada, the client will receive a slip for Canadian residents, regardless of their residential address.
What happens if the client’s account is not in Canadian dollars?
All tax slips, except for T3/RL-16/T5013, are issued in the currency of the account. In line with CRA regulations, T3, RL-16, and T5013 tax slips are issued in Canadian dollars. For accounts in US dollars, the summaries will show the annual average conversion rate as published by the CRA.
Does the return of capital appear on tax slips?
Yes, the return of capital is reported as follows:
- T3 Tax Slip: Box 42 (T3) and Box M (RL-16).
- T5013 Tax Slip: Box 113 (T5013) and Box 43 (RL-15).
- Return of Investment Income Summary: Reported, but not included on T5 or RL-3 slips.
My client has a joint account, but only one SIN appears on the T5 slip. Can both SINs be included?
No, there is not enough space to include both SINs on the same T5 slip. However, the CRA allows more than one individual to report income from the same slip as long as the number "2" is indicated in Box 23, confirming that the account is joint. In such cases, income can be reported by one or both spouses.
Why are eligible and other than eligible dividends reported separately on T5 and RL-3 slips?
This is normal.
- T5 Tax Slip: Eligible dividends are reported in Box 24 and other than eligible dividends in Box 10. The taxable amounts and tax credits are also reported in different boxes.
- RL-3: Eligible dividends appear in Box A1 and other dividends in Box A2.
For corporations, these amounts are consolidated in Box E for other income.
Why are eligible and other than eligible dividends reported differently on T3 and RL-16 slips?
This is normal.
- T3 Tax Slip: Eligible dividends appear in Box 49 and other than eligible dividends in Box 23.
- RL-16: Eligible dividends are reported in Box C1 and other dividends in Box C2.
What is the difference between a Trading Summary and a Statement of Securities Transactions (T5008/RL-18)?
The T5008/RL-18 Statement of Securities Transactions was updated in 2014 to align with CRA standards.
- Trading Summary: Shows all transactions, including purchases and sales.
- T5008/RL-18: Displays only the Proceeds of Disposition (sales), which assists clients in fulfilling tax obligations.
Do the T5008/RL-18 and Trading Summary tax slips report all types of security transactions?
No, transactions related to certain Guaranteed Investment Certificates (GICs) where the capital value remains the same upon purchase and maturity are not reported.
Why is income earned from Optimize Pooled Funds not reported on a tax slip?
Our custodian does not issue tax slips for Optimize Pooled Funds. Optimize issues these slips separately and notifies all clients, advisors, and Portfolio Managers before distribution.
Will my client receive an amended or cancelled NR4 tax slip to reduce the reported tax?
No, the CRA does not allow NR4 slips to be amended or cancelled to reduce the amount of tax withheld. However, clients can apply for a refund by filing an NR7-R Application for Refund of Non-Resident Part XIII Tax Withheld.
Will a client receive two contribution receipts if they make separate contributions?
If two contributions are made during the same processing period, only one receipt will be issued. Separate receipts will only be issued if the contributions are made during different processing periods.
Will a client receive a receipt for a transfer to a registered account?
No receipt is issued for a transfer between institutions (coded as "transfer 146.16"). However, receipts will be issued for transfers related to separation slips, retirement allowances, termination allowances, or estate transfers.
Will my client receive a receipt for contributions made to a TFSA account?
No, tax slips are not issued for TFSA contributions. However, information about contributions and withdrawals is sent to the government electronically.
When are tax slips issued for TFSA accounts?
Generally, investment income earned within a TFSA is not taxed, and tax slips are not issued. However, slips may be issued under certain conditions, including:
- If the TFSA is no longer a "qualifying arrangement."
- If the account contains contributions made while the holder was a non-resident.
- If the TFSA acquires non-qualified or prohibited investments.
What tax slips are issued in the case of a TFSA holder’s death?
A T4A and RL-1 (for Quebec clients) are issued if the fair market value (FMV) of the TFSA at death is lower than the amount transferred to beneficiaries. Any gain beyond the FMV is reported as income to the beneficiaries.
When are tax slips issued for an estate?
Tax slips for registered and non-registered accounts are issued at the beginning of the year during the regular processing period.
Can a T4RSP, T4RIF, or RL-2 slip be issued in the name of the spouse?
No, these tax slips must be issued in the name of the annuitant. However, the spouse’s SIN is included on the slip.
In which currency is the contribution receipt for a US RRSP issued?
Contribution receipts for US RRSP accounts are issued in Canadian dollars.