A number of visitors to Canadian Tax Resource write me with their questions. I haven’t published reader questions and answers in quite some time and over the Christmas break, I will post a number of recent questions posed by visitors.
If you have a question, please feel free to ask. While, I cannot provide official tax advice, I can certainly let you know my thoughts and hopefully point you in the right direction.
Reader Question – Put & Call Option Losses
Last year, I put a lot of money in buying option calls and option puts. Some of these I sold at a profit. Most of them expired worthless. So, in the end my net loss was over $10,000. Should I have got some tax form from my bank regarding this loss that I can then claim against any capital gains in future years?
The treatment of your options trading for tax purposes is dependent on your classification as either an investor or trader. If your investments normally result in capital gains or losses then your gains or losses on the disposition of options are on account of capital and gains or losses would be capital gains or losses.
Your investment dealer must provide you information about dividends and interest paid to you from holding securities and must also provide you with confirmations of your acquisitions and dispositions (other than expiry). Other than that, you are required to report your own capital gains or losses.
