On January 31, 2025, the Honourable Dominic LeBlanc, Minister of Finance and Intergovernmental Affairs, announced that the federal government is deferring the increase of the capital gains inclusion rate from one-half to two-thirds. The new implementation date is January 1, 2026, instead of June 25, 2024. This change applies to capital gains realized annually above $250,000 by individuals, all capital gains realized by corporations, and most types of trusts. The capital gains inclusion rate determines the taxable portion of capital gains.
The government will maintain or enhance existing capital gains exemptions while introducing a new investment incentive. Details regarding the Gains Exemption and the introduction of the Canadian Entrepreneurs’ Incentive will be provided when available.
As a result of the Institute’s continuous advocacy efforts, we are pleased to announce that the CRA has confirmed no amended T4s will be required for the 2024 tax year reporting of employee security options.
If the employer reports using the old codes, the corresponding deduction should be reported as 1/2 of the benefit. If they report using the new codes, the corresponding deduction should be reported as 1/3 of the benefit.
The employee will be able to properly claim the full 1/2 deduction on their personal income tax return.
The CRA has also confirmed that for the 2025 taxation year, filers will only use the new codes 90, 91, and 92. The old codes (38, 39, and 41) will only be used for late filing or for amendments.