The reconciliation checker above compares the cost or book value reported in Box 20 of your T5008 tax slip with your documented adjusted cost base, identifies the dollar discrepancy, and estimates its tax effect using the assumptions you enter.
Canadian securities dealers use Form T5008 (Statement of Securities Transactions) to report applicable securities transactions to recipients and the Canada Revenue Agency (CRA). You may receive individual slips or a consolidated statement.
Box 21 reports proceeds of disposition or settlement amount. Box 20 reports cost or book value, but CRA cautions that it may or may not reflect the investor’s ACB and may need adjustment.
Why T5008 Box 20 can differ from adjusted cost base
Under the Income Tax Act’s identical-property rule, shares of the same class held under the same taxable ownership can form one weighted-average ACB pool even when they are held through different brokerages.
Broker records can still be valuable evidence, but the table below shows information you should verify before treating Box 20 as the final ACB:
| Factor or scenario | What to verify | ACB treatment | Possible Box 20 effect |
|---|---|---|---|
| Inter-broker transfers | Whether the original transaction history and cost information carried forward | A transfer between accounts under the same ownership is not normally a disposition by itself | A placeholder or incomplete cost can cause a difference |
| Cross-brokerage pooling | Whether identical property is held in another taxable account under the same ownership | Combine identical property in the applicable ACB pool | An account-level figure may omit outside holdings |
| ETF return of capital (ROC) | Whether all relevant fund adjustments are included | ROC generally reduces ACB | Missing adjustments can overstate ACB |
| DRIP reinvestments | Whether every reinvested distribution is recorded | A reinvestment generally adds a new acquisition to the pool | Missing purchases can understate ACB |
| USD exchange rates | May use an actual conversion, daily source, reporting-period average, or another documented method. | Use a CRA-supported rate method consistently and retain the source and date. | FX difference: Reconcile the source, date, currency code, and calculation. |
What CRA says about Box 20
CRA’s T5008 guidance for individuals says Box 20 may or may not reflect ACB and that the investor must make any needed adjustments when determining and reporting the gain or loss.
When completing your Canadian income tax return:
- Do not automatically accept Box 20 if your verified transaction ledger shows a different figure.
- Enter proceeds, ACB, and outlays in the appropriate securities section of Schedule 3 and use the line numbers shown on the return for the relevant tax year.
- Retain the reconciliation and source records supporting any adjustment to the broker figure.
Worked Example: Tax Impact of a Box 20 Mismatch
Consider an investor who transferred 100 shares of Royal Bank of Canada (RY.TO) from Brokerage A to Brokerage B:
- Original purchase at Brokerage A: 100 shares @ $$120.00 = \mathbf{$12,000.00\text{ CAD}}$ documented ACB.
- Transfer to Brokerage B: Brokerage B recorded a placeholder book value of $$95.00/\text{share} = \mathbf{$9,500.00\text{ CAD}}$.
- Sale at Brokerage B: 100 shares sold @ $$145.00 = \mathbf{$14,500.00\text{ CAD}}$ (Box 21 Proceeds).
Comparison of Tax Outcomes:
| Metric | Broker T5008 Box 20 | Your True ACB Ledger | Discrepancy & Tax Impact |
|---|---|---|---|
| Proceeds of Disposition (Box 21) | $$14,500.00\text{ CAD}$ | $$14,500.00\text{ CAD}$ | $$0.00$ |
| Adjusted cost base | $$9,500.00\text{ CAD}$ | $$12,000.00\text{ CAD}$ | $-$2,500.00\text{ CAD}$ (understated cost) |
| Realized capital gain | $$5,000.00\text{ CAD}$ | $$2,500.00\text{ CAD}$ | $+$2,500.00\text{ CAD}$ overreported gain |
| Taxable capital gain (illustrative 50% inclusion rate) | $$2,500.00\text{ CAD}$ | $$1,250.00\text{ CAD}$ | $+$1,250.00\text{ CAD}$ excess taxable amount |
| Estimated Tax (at 43.5% bracket) | $$1,087.50\text{ CAD}$ | $$543.75\text{ CAD}$ | $$543.75\text{ CAD}$ overpaid in tax |
With the illustrative 50% inclusion rate and 43.5% marginal rate shown above, supporting and reporting the $$12,000\text{ CAD}$ ACB reduces the estimated tax by $$543.75\text{ CAD}$. The actual tax effect depends on the law applicable to the disposition and the taxpayer’s circumstances.
Records to keep with the reconciliation
Keep the following records to support the reported adjusted cost base if CRA asks for more information:
- Trade Confirmations: Buy and sell confirmations showing date, share quantity, unit price, and commissions.
- Running ACB Ledger: A date-sorted ledger demonstrating the weighted average cost after every purchase, transfer, and sale.
- Annual T3 Tax Slips: For ETFs and mutual funds, keep copies showing Box 42 (Return of Capital) to justify cumulative cost adjustments.
- Brokerage Transfer Statements: Documentation showing the date of transfer between financial institutions.
Scope note: This reconciliation tool evaluates single-security dispositions. It estimates a tax effect from the assumptions entered; it does not determine the applicable inclusion rate or replace tax advice. For multi-account portfolio reconciliation and T5008 CSV batch imports, use myCostBase.