Adjusted cost base (ACB) is the number that determines your taxable capital gain when you sell a Canadian investment. Calculating it correctly is your legal obligation — not your broker’s. This page explains what a complete ACB calculator needs to handle and how myCostBase functions as a full ACB tracker for Canadian investors.
What adjusted cost base means for Canadian investors
Adjusted cost base is the average cost per share of a security, calculated across all taxable accounts you hold for that security, and adjusted over time for events that change your cost. When you sell, your capital gain equals:
Proceeds of disposition − Adjusted cost base − Selling commissions = Capital gain or loss
The “adjusted” part is what makes this calculation more complex than a simple average: return-of-capital distributions from ETFs reduce your ACB; DRIP reinvestments add to it; stock splits change the per-share figure; and transfers between brokerages must carry the original cost forward without a reset.
CRA’s rule is the weighted average pooling method: every share of the same security held in any taxable account by the same investor is one pool. If you hold XEQT at Wealthsimple and Questrade, you don’t have two ACBs — you have one pooled ACB across both positions.
What transactions affect adjusted cost base
A complete ACB calculator must handle all of the following:
| Transaction | Effect on ACB |
|---|---|
| Purchase (buy) | Increases total ACB; recalculates ACB per share |
| Sale (full or partial) | No change to ACB per share; reduces share count only |
| DRIP reinvestment | Increases total ACB and share count (treated as a purchase at distribution price) |
| Return of capital (ROC) | Reduces total ACB; lowers ACB per share |
| Phantom income / reinvested gains | Increases total ACB (you paid tax on this income) |
| Stock split | Doubles shares, halves ACB per share; total ACB unchanged |
| Stock consolidation | Reduces shares, increases ACB per share; total ACB unchanged |
| Broker transfer (taxable to taxable) | ACB carries through at original cost — no reset at market value |
| Superficial loss denial | Denied loss added to the ACB of the repurchased shares |
Why simple ACB calculators fall short
A one-transaction ACB calculator can compute the gain on a single buy-and-sell scenario. It cannot:
- Pool across multiple brokerage accounts
- Apply annual ETF distribution adjustments (ROC, phantom income)
- Handle years of DRIP reinvestments across dozens of dates
- Convert USD trades at Bank of Canada daily rates per transaction
- Carry ACB through broker transfers at original cost
- Reconcile against T5008 Box 20 at year end
For the single-security, single-account investor with no ETF distributions, a simple calculator or spreadsheet is adequate. For most Canadian investors with diversified taxable portfolios — particularly those holding ETFs across multiple accounts or trading USD-denominated securities — a running ledger is the appropriate tool.
ACB calculation example
Two purchases and a partial sale of a Canadian stock:
January 2022: Buy 100 shares of RY.TO at $132.00. Commission: $9.95.
- Total ACB: $13,209.95
- ACB per share: $132.10
June 2022: Buy 50 more shares at $128.00. Commission: $9.95.
- New total ACB: $13,209.95 + (50 × $128.00) + $9.95 = $19,619.90
- Total shares: 150
- ACB per share: $130.80
March 2024: Sell 60 shares at $140.00. Commission: $9.95.
- Proceeds: (60 × $140.00) − $9.95 = $8,390.05
- ACB deducted: 60 × $130.80 = $7,848.00
- Capital gain: $542.05
- Remaining: 90 shares at ACB per share of $130.80
The ACB per share does not change when you sell a partial position. Only the share count decreases.
Average cost base calculator vs. ACB ledger
“Adjusted cost base” and “average cost base” refer to the same calculation method — both use the weighted average pooling approach required by CRA. The term “average cost base calculator” is sometimes used interchangeably with ACB calculator. The calculation is identical; the terminology differs by preference.
For a complete step-by-step worked example including stocks, ETFs, USD trades, and partial sales, see How to Calculate Adjusted Cost Base in Canada.
Using the T5008 reconciliation checker
The tool above compares T5008 Box 20 (your broker’s cost or book value) against your own ACB records. This is useful at tax time to identify discrepancies before filing, understand how much of your capital gain the T5008 might be underreporting, and confirm which figure to use on Schedule 3 (your own ACB, not Box 20).
For a detailed explanation of why T5008 Box 20 is often different from your legal ACB, see T5008 Box 20 and Adjusted Cost Base.
How myCostBase functions as an ACB calculator
myCostBase maintains a running ACB ledger for every security across all your taxable accounts. As you enter or import transactions, the system:
- Pools identical securities across all accounts automatically
- Applies ETF distribution adjustments (ROC reductions, phantom income additions) from provider data
- Converts USD trades at Bank of Canada daily rates per transaction date
- Flags T5008 mismatches at year-end with a reconciliation report
- Maintains an audit trail with per-entry adjustments and ACB history
The free plan supports unlimited manual transaction entry for one tax owner. You can start with a single security to verify the calculation against your own records before migrating your full history.
For investors currently using a spreadsheet, see Adjusted Cost Base Spreadsheet for Canadian Investors for a comparison of when each approach is appropriate.