How to Report T5 Investment Income on Your Tax Return
A T5 reports investment income over $50: bank interest, dividends, and capital gains distributions. Each box maps to a specific line of your T1 — and the dividend tax credit means eligible dividends are taxed at a lower effective rate.
The Steps
Follow these in order
Each card shows the phase, expected time, and any cost. Data checked against official CAN sources(2025-Latest).
0 of 7 steps
- Before You Go 20 min
Collect every T5 — including small ones
Every financial institution that paid you $50+ in investment income issues a T5, and the CRACanada Revenue Agency — Canada's tax agency. It administers income tax, benefits like the GST/HST credit, and CRA My Account.Click for official info ↗ receives a copy. Missing slips generate automated letters months later. Log into each bank and brokerage and download tax slips from the documents section; CRACanada Revenue Agency — Canada's tax agency. It administers income tax, benefits like the GST/HST credit, and CRA My Account.Click for official info ↗ My Account's Auto-fill my return catches them all.
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- Before You Go 15 min
Read the boxes correctly
Box 10: interest from Canadian sources (fully taxable at your marginal rate). Box 11: eligible dividends (enhanced gross-up + credit). Box 12: non-eligible dividends (smaller gross-up). Box 15: foreign dividends (with foreign tax paid in box 16 — claimable as Foreign Tax Credit). Boxes 18/21: capital gains. Each maps to a specific T1 line; software does the routing.
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- Fill / Prepare 10 min
Enter interest income (Box 10)
Interest is taxed at your full marginal rate — no preferential treatment. It goes on line 12100 (was line 121). If you have interest under $50 without a T5, report it anyway; the obligation follows the income, not the slip.
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- Fill / Prepare 15 min
Enter dividends and claim the tax credit
Eligible dividends (Box 11) are grossed up 38% then offset by the federal dividend tax credit (15.0198% of the grossed-up amount) plus provincial credits — the net effect is a lower rate than salary. Your software calculates Schedule 4 and the credit automatically; just enter the box amounts exactly as printed.
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- Fill / Prepare 15 min
Handle foreign dividends and withholding tax
US stocks in a non-registered account lose 15% to US withholding (claim it back via the Foreign Tax Credit on line 40500). Inside a TFSA the withholding is unrecoverable; inside an RRSP it does not apply to US dividends. This is why US stocks belong in RRSPs first for many investors.
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- Submit & Pay 10 min
File and reconcile with your assessments
NETFILENETFILE — CRA's service for filing your own tax return online using certified software.Click for official info ↗ your return; the CRACanada Revenue Agency — Canada's tax agency. It administers income tax, benefits like the GST/HST credit, and CRA My Account.Click for official info ↗ computer-matches every T5 within weeks. If a slip is wrong, ask the issuer for an amended T5 before filing — do not adjust it yourself. Keep slips and brokerage summaries 6 years.
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- Follow Up 20 min
Plan next year: use TFSA and RRSP room
Interest and dividends inside a TFSA are tax-free (no T5 issued); inside an RRSP they are tax-deferred. If your T5s are growing, check your TFSA and RRSP contribution room on your Notice of Assessment and shelter the highest-taxed income first (interest, then foreign dividends, then eligible dividends).
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FAQ
Frequently Asked Questions
I did not get a T5 but I earned bank interest. Do I report it?
Yes. Banks only issue T5s for $50+ per account, but all interest is taxable regardless. Add it up from your statements and report it on line 12100. The CRACanada Revenue Agency — Canada's tax agency. It administers income tax, benefits like the GST/HST credit, and CRA My Account.Click for official info ↗ can assess unreported income years later with penalties.
What is the difference between a T5 and a T3?
T5 covers interest and dividends paid directly to you. T3 covers income flowing through trusts and mutual funds — capital gains distributions, return of capital, foreign income. Both go on your T1; Auto-fill my return captures both.
Do I pay tax on T5 income inside my TFSA?
No — TFSA investment income is tax-free and generates no T5 to you. The exception is US withholding tax on US dividends inside a TFSA, which the US takes and Canada cannot credit back. US stocks are more tax-efficient inside an RRSP.
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