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Glossary term
Tax Slips — T4, T5, T3, T4A
Standardized forms that payers send to you and the CRA reporting your income. T4 — employment income; T5 — investment income (dividends, interest); T3 — trust/ETF distributions; T4A — pension, scholarships, self-employed commissions. All appear in CRA My Account by late March and auto-fill into tax software.
Related terms
ACB
Adjusted Cost Base — the tax cost of an investment: purchase price + commissions + reinvested distributions,…
Capital Gains Inclusion Rate
The share of a capital gain added to taxable income. In Canada it's 50% — sell an investment at a $10,000 gai…
Marginal Tax Rate
The tax rate on your next earned dollar (combined federal + provincial). Canada uses progressive brackets: th…
PRE
Principal Residence Exemption — shelters the capital gain on selling a home that was your principal residence…
CDA
Capital Dividend Account — a notional CCPC account tracking the tax-free half of capital gains (the 50% not i…
Eligible vs Non-Eligible Dividends
Two categories of Canadian dividends with different gross-up and dividend tax credit. Eligible (from public-c…
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