Schedule 6. Capital Gains and Losses
Schedule 6 (T2SCH6) summarizes dispositions of capital property during the tax year and computes taxable capital gains, allowable capital losses, and the capital dividend account credit.
Federal · Updated September 23, 2026
Definition
Schedule 6 (T2SCH6), "Summary of Dispositions of Capital Property," is the corporate equivalent of the individual Schedule 3. It reports dispositions of capital property (shares, bonds, real estate, depreciable assets with capital gains above their tax capital cost, personal-use property) and calculates the taxable capital gain (TCG) or allowable capital loss (ACL) for the year. The result flows to line 113 of Schedule 1. Net Income for Tax.
File Schedule 6 in any year the corporation disposes of capital property, receives a deemed disposition, or needs to claim the capital gains reserve under s.40(1)(a)(iii). The schedule also generates the non-taxable half of a capital gain, which is the primary source of credits to the Capital Dividend Account (CDA).
Key rules
Inclusion rate (2026): Under the rules in effect for 2026, the capital gains inclusion rate remains 50% for corporations. For an ordinary capital gain, one-half is taxable under ITA section 38. A private corporation also tracks the non-taxable portion, net of relevant non-deductible capital losses and other adjustments, in its CDA. Exceptions such as qualifying gifts of listed securities require separate treatment.
Capital gain = Proceeds – ACB – Outlays and expenses Capital loss = ACB + Outlays and expenses – Proceeds Taxable capital gain (TCG) = 50% × Capital gain Allowable capital loss (ACL) = 50% × Capital loss CDA credit per gain = 50% × Capital gain (non-taxable half)
Disposal details: Use the asset categories on the current corporate Schedule 6 and keep the purchase cost, tax cost adjustments, sale proceeds and disposal costs. A corporation does not claim an individual’s lifetime capital gains exemption. A qualifying reserve can defer a portion of a gain when sale proceeds remain receivable; the ordinary maximum is five years, subject to the statutory limits and exceptions.
Loss restrictions: Superficial-loss and corporate affiliated-person stop-loss rules can deny or suspend a claimed loss. Repurchasing identical property within the 30-day period before or after a sale requires checking ownership at the end of that period and the applicable corporate rule. An immediate deduction is not assured.
Example
Oakwood Holdings Ltd., a private corporation with no opening CDA adjustments or other gains and losses, sold shares of a public company during 2026:
Proceeds 80,000 Less: adjusted cost base 50,000 Less: selling commissions 1,500 Capital gain 28,500
Taxable capital gain (50%) 14,250 before the separate allowable loss below Non-taxable portion (50%) 14,250 → CDA credit
Separate transaction: sale of land at a loss Proceeds 60,000 ACB 70,000 Capital loss 10,000 Allowable capital loss (50%) 5,000 Non-allowable portion (50%) 5,000 → reduces the CDA
The two transactions together produce $14,250 − $5,000 = $9,250 of net taxable capital gains for Schedule 1 line 113, and a $9,250 net addition to the capital-gain component of the CDA.
Common mistakes
Recording the book gain on Schedule 1 line 113. Line 113 is the taxable capital gain from Schedule 6 (50%), not the full accounting gain. The full book gain is reversed on line 401 of Schedule 1.
- Forgetting to update the CDA balance for the non-taxable portion. Schedule 89 can request CRA verification of the balance. A capital-dividend election is made on Form T2054; Schedule 89 is not that election.
- Netting gains and losses improperly. Allowable capital losses only offset taxable capital gains, never ordinary income (see Schedule 4. Corporation Loss Continuity).
- Treating recapture on depreciable property as a capital gain. Recapture is ordinary income on Schedule 8. Capital Cost Allowance; only proceeds exceeding original cost produce a capital gain.
- Missing the superficial loss denial on tax-loss selling within 30 days.
Official source
Related concepts
Sources
- CRA Form T2SCH6
- Income Tax Act s.38
- Income Tax Act s.39
- Income Tax Act s.40
- Income Tax Act s.89(1) (CDA)
See also
Keep the books behind these numbers current.
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