CNIL Where does the automatically generated number come from?

[Will B]

I loaded up the ufile for the 2020 tax season and noticed there was an auto generated T936 - CNIL (Cumulative Net Investment Losses) section that popped up with a value. I don't recall having a T936 filled out in the past, where does it pull this information from? Is there information on my online CRA account that it would of got the information? 

[TheTaxSmith]

Hello Will B.

Basically it's a balance of all your investment incomes minus your losses. Cumulative Net Investment Losses. Over time if your losses and expenses are greater than your positive income from investments you will have a CNIL balance that affect the use of capital gains deductions. The software keeps track for you. That said you need to make sure it reconciles to the balance CRA shows on your account. You may see it stated on your Notice of Assessment. 

[gordon86]

Hey TheTaxSmith,

You never answered the question, where does the T936 come from? I have no investments and yet a T936 appeared in my Ufile auto fill this tax season. So where did it come from? Where is the software pulling this information from? How do I fix it?

Regards,

Gordon

[Curmudgeon]

Check this listing of investment income and expenses that will trigger CNIL and since it's cumulative it will appear every year.

https://help.hrblockonline.ca/hc/en-ca/articles/227762548-T936-Calculation-of-Cumulative-Net-Investment-Loss-CNIL-

[gordon86]

Thanks Curmudgeon, turns out it was interest earned from my bank. Which is on the list you linked to.

[Jeff75]

So I have the same situation.  I don't have unregistered investments, but do have an investment property.  A CNIL balance showed up but I wasn't sure exactly what it meant.  Now I see that it can be used to reduce a capital gain on the sale of an investment property.  It's still not clear how the software generated that CNIL total.  For me, it's a positive number in ufile, but since it's a CNI "Loss" does that mean it's really a negative and will REDUCE my capital gains if I apply it?  Over the years the income has exceeded the expenses on my investment properties, so there shouldn't be a cumulative loss.  I'm not sure how the software generated this number, and I don't trust it to be correct.  I looked at my CRA "my account" and don't see the CNIL listed there.  Any insights?

[TheTaxSmith]

When you first set up your file using Ufile did you include carryover balances such as your CNIL balance? If you did was it done correctly? You should be able to look up your CNIL balance online with CRA. If not ask them by phone for a printed history and balance. If your CNIL balance is in negative territory, meaning prior year expenses exceed prior year earnings the availability for the qualified capital gains deduction will be limited. CNIL will not affect capital gain claims, only the potential deduction against them. Most people will never be able to take advantage of qualified capital gains deductions. The fact that you have an investment property means you have an annual adjustment to your CNIL balance. So go back and look at the history and reconcile the CNIL in your Ufile with the one that CRA has on file.

[AlyW]

Log in to your CRA MyAccount.  Under Tax Returns, scroll down the page and click on "View Carryover Amounts."

In my case, it came from my previous year rental income.