What You Should Know About a T3 and T5

‍

T3 Tax Form: Trust Income in Canada

‍

What is a T3 Tax Form?

A T3 tax form is sent to individuals who have investment income from certain trusts and any mutual funds in non-registered accounts.‍

‍

What Investments are Reported on a T3? ‍

‍

Some examples of investments that may be reported are: 

• Capital gains
• Interest
• Dividends

Upon tax season, each investment will be reported differently and have different rates as well. To find out more, click here.
‍

When Will I Receive my T3 Form?

‍

Most individuals will receive their T3 Form every year by the end of March 

Will I Always Receive T3 When I Receive Income?

Be mindful that if your interest earned is less than $50 or if your capital gains or dividends are less than $1, the mutual fund company that you invest in will not issue a T3 

Here are some other important information to know about a T3:

• The income that was reinvested with be considered as taxable even if it was used to buy more units and have not been paid in cash
• You will receive one T3 if you have invested in multiple mutual funds that are managed by the same financial institution or broker. If not, you may receive different T3’s by other institutions or brokers 

T5 Tax Form: Statement of Investment Income in Canada

What is a T5?

A T5 is a form that is used to report different types of investment income. Individuals will receive this slip when they earn more than $50 in investment income during the year. 

‍

What if the T5 statement of investment income is in both my spouse and I’s name?

Both must claim the exact portion of how much each individual has contributed to the investment account. 

What to remember: Amount to report = personal amount contributed / total amount contributed

Tyler and Katie have an investment account together that pays off interests. Katie contributed $4,000 while Tyler contributed $2,000.

Upon tax season, they both received a T5 slip with both names on it and an amount of $100 in Box 13.

Each will have to report a portion of this income in their tax returns:

• Katie will report: $100 x $4,000/$6,000 = $66.67
• Tyler will report : $100 x $2,000/$6,000 = $33.33

‍