Why options need their own ACB treatment
An option’s premium is not a share purchase, and writing an option is not a share sale. What the premium eventually becomes for tax purposes — a capital gain, a capital loss, or an adjustment to the ACB of the underlying shares — depends entirely on how the position is closed out: bought back, exercised, assigned, or left to expire. A ledger that only understands buys and sells cannot track that correctly.
Supported option transaction types
myCostBase tracks single-leg equity and ETF options through the following events:
Long options (options you buy)
- Buy to open
- Sell to close
- Exercise a long call — buy the underlying shares
- Exercise a long put — dispose of the underlying shares
- Expiry worthless — the full premium becomes a capital loss
Written options (options you sell/write)
- Write to open
- Buy to close
- Expiry worthless — the full premium becomes a capital gain
- Assignment on a written call — forced sale of the underlying shares
- Assignment on a written put — forced purchase of the underlying shares
How the deferred-premium pool works
Premium received for writing an option is not taxed immediately. myCostBase holds it as deferred premium in a weighted-average pool for that option series — same underlying security, type, strike, and expiry — the same way it pools cost for identical shares. When you partially close a written position, the ledger allocates a proportional share of the deferred premium to that closing transaction, rather than treating each contract as an isolated lot.
What happens on exercise, assignment, and expiry
- Long call exercised: the option’s premium is added to the ACB of the shares you acquire at the strike price.
- Long put exercised: treated as a disposition of the underlying shares at the strike price; the premium reduces the sale proceeds.
- Written call assigned: the underlying shares are sold at the strike price, and the premium is added to the proceeds of that disposition.
- Written put assigned: the underlying shares are purchased at the strike price, and the premium reduces the ACB of the newly acquired shares.
- Expiry worthless: the full premium is realized as a capital loss (long options) or a capital gain (written options), with no underlying share transaction.
Contract multiplier
Each option security has a contract multiplier — the number of underlying shares one contract controls. It defaults to 100, the standard for most listed equity and ETF options, and can be edited for non-standard or adjusted contracts, such as those affected by a stock split or other corporate action. Getting the multiplier wrong silently misstates every calculation built on that option, so confirm it during setup.
What’s not supported yet
myCostBase covers single-leg long and written option positions. Multi-leg strategies — spreads, straddles, collars, and other combined positions — and complex broker lifecycle linking across legs are not yet supported.
Where to go next
For the setup decisions that affect which accounts belong in your ACB pool, see Pooled ACB Across Brokerages. For how ETF-specific adjustments interact with the same ledger, see ETF Return of Capital and ACB Adjustments.