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First time doing my own taxes, trying to declare day-trading


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Hi all, first time filing taxes here. I'm sure that comes up a lot :)


I am trying to declare day trading income. The amount of trades is relatively small (~20 I think), but trying to declare them is a bit confusing. I have done some reading and determined that it qualifies as "income" rather than an investment, since many of these trades were settled the same day. Some were not, but based on sections 9 and 10 of https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/it479r/archived-transactions-securities.html it appears I meet the other qualifications as well due to a nearly complete degree in a finance related field, and significant time studying the topics.

Anyways, it seems like what I should be doing is declaring it as self-employed business income. The closest I see is T2125 - Business Income, but there are fields for which I have no answer (Federal account number). Do I leave these fields blank? I believe the closest NAICS code is 523110 - Investment banking and securities dealing.

I was under the impression when I started this that you would simply need to take documents from your broker (T5, T5008, both of which I have) and fill the fields in the software similar to a T4. Of course that isn't so. Any help would be appreciated, especially if you've been in this situation before and can give me more specific advice. The complexity of this has started to make me nervous, so I'm seriously considering taking it to a professional at this point just so I don't screw something up with the CRA.


Thanks, Chris

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You need to consult a tax accountant or a tax lawyer to find out how you should report your trading profit/loss.  NetFile is a tax filing software only that allows you to prepare your taxes and file them electronically (optionally) to all the tax agencies but is not a tax-advising service.  It cannot and does not offer tax advice as it is not qualified to do so. 

Good luck!   

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Hey C B, try doing a search for "day trading" and look at what other people have done and their questions. Day trading is usually considered by CRA as business income rather than capital gains and losses. Yes taking it to a professional CPA is usually a good choice. That said there is value in asking this community which increases your knowledge and helps your understanding moving forward.

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  • 7 months later...

Declaring trading income used to be a headache for me. In general, my beginning of trading was complicated. Starting from the construction of trading tactics to the declaration of income. But I found an answer to both problems at https://www.humaninvesting.com. Everything is much easier than it seems once you find the correct information. You declare your taxes, and the process is relatively easy. If you do it right, having a very high income from trading is very simple. So, I recommend you to inform more.

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Hello AustinsJfBellm,

Day trader definition :
A day trader is a person who makes their living buying, selling securities. The Canada Revenue Agency looks at several factors to define investment professionals for purposes of taxation. If a taxpayer is using day trading as a way to earn or substantially supplement his income, he is not eligible to claim capital gains, and its advantageous tax rate, on those investment earnings.
A person who works in the investment industry and makes frequent short-term investment turnovers, such as a stockbroker, for example, may be considered a day trader as well.

The CRA looks at several factors to consider if a taxpayer is in the business of buying and selling securities. A professional investor will have many buying and selling transactions.

    Knowledge and experience with securities markets and transactions and time spent analyzing markets and investments also identify those engaged in investment as a business. Purchases may also be financed on margin or other debt, and the shares purchased generally won’t pay dividends.
    OF note, each securities transaction generates a T5008 slip, which identifies the purchaser by name and social insurance number, so the CRA can monitor.
    The size of the capital gains claimed may also factor into the determination that the taxpayer invests as a business. capital gains through Schedule 3.

You should consult with an accountant.

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  • 4 months later...

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