T2 Schedule 6: half the net gain to Schedule 1 line 113 for 2026

What goes in each part of Schedule 6?

Use Schedule 6 when the corporation disposed of capital property, actually or by a deemed disposition, or claims an allowable business investment loss (ABIL) in the year canada.ca. Each disposition sits on its own row with the date acquired, proceeds of disposition, adjusted cost base (ACB) and outlays and expenses, and the gain or loss is proceeds minus the other two canada.ca.

Line 050 sits above Part 1. Answer yes if any disposition relates to a deemed disposition designated under paragraph 111(4)(e) after an acquisition of control, and attach a statement naming the properties canada.ca. Property in Part 7 stays out of every other part.

How does Part 9 turn the net gain into the taxable amount?

Part 8 adds amounts A to F (F only if it's a gain), adds capital gains dividends received on line 875 and last year's capital gains reserve on line 880, then subtracts this year's closing reserve on line 885. Both reserve figures come from Part 1 of Schedule 13, and the result on line 890 is the capital gain or loss before ABILs canada.ca.

The 50% comes from section 38: a taxable capital gain is one half of the gain and an allowable capital loss is one half of the loss laws-lois.justice.gc.ca. That rate holds for 2026 because the two thirds increase was cancelled; see the 2026 inclusion rate. The current form is the 2024 version, which applies 50% on amount R canada.ca.

Line 902 is for a partnership interest sold to a tax exempt entity, a non resident, or a partnership or trust with such members. Only the part of that gain attributable to non depreciable capital property gets 50%; that part goes in Part 4, and the rest goes on line 902 canada.ca.

How much of a $213,000 gain is taxed in 2026 after a $105,000 reserve?

Your client is a holding corporation with a December 31, 2026 year end and no reserve from 2025. During 2026 it sells public company shares for $180,000 (ACB $100,000, commissions $2,000), a vacant lot for $400,000 (ACB $250,000, legal fees $10,000) and a bond for $45,000 (ACB $50,000). The buyer of the lot pays $100,000 at closing and gives a $300,000 mortgage due after 2026.

The reserve here is the lesser of two caps: the gain times the share of proceeds not due until after year end ($105,000), and 4/5 of the gain in the year of sale ($112,000) canada.ca. In 2027 the $105,000 comes back on line 880, and the new reserve can't exceed 3/5 of $140,000, or $84,000. So at least $21,000 more of the gain is reported in 2027 even if the buyer pays nothing. The rules behind the caps are on the capital gains reserve page.

The other $54,000 of the $108,000 is not taxed, and that half is what feeds the capital dividend account (next section).

Where does the untaxed half of the gain go?

For a private corporation, the capital dividend account adds each capital gain minus its taxable capital gain, and subtracts each capital loss minus its allowable capital loss, from the start of the first year after the corporation last became a private corporation laws-lois.justice.gc.ca. In the example, $54,000 goes into the account. Paying it out tax free takes a Form T2054 election under subsection 83(2) canada.ca; see the capital dividend account.

Gifts on lines 895 and 896 work differently. Their taxable capital gain is zero under paragraph 38(a.1) laws-lois.justice.gc.ca, so the whole gain is the untaxed part that the definition adds to the account.

For a CCPC, the taxable half also counts. Aggregate investment income includes taxable capital gains net of allowable capital losses, less any net capital losses deducted under paragraph 111(1)(b) laws-lois.justice.gc.ca. That flows to Schedule 7; see T2 Schedule 7.

Which dispositions stay off Schedule 6 or follow special rules?

Depreciable property sold at a loss. Parts 2 and 4 both say not to include losses on depreciable property. A loss on a depreciable asset is never a capital loss; it's a terminal loss, deducted on Schedule 1 line 404 from Schedule 8, while recapture goes to line 107 canada.ca. Only proceeds above capital cost produce a capital gain on Schedule 6. See recapture and terminal loss and T2 Schedule 8.

Personal use property. If the ACB or the proceeds are under $1,000, use $1,000. Losses on personal use property can't be deducted, except on listed personal property or a debt canada.ca.

Listed personal property. Net LPP losses only offset LPP gains, which is why Part 6 pulls unapplied losses from Schedule 4 line 530 and a net LPP loss stays out of amount H canada.ca.

Shares and the stop loss rule. Under paragraph 112(3)(b), a loss on shares held as capital property is reduced by certain dividends received on them. It generally doesn't apply if the corporation owned less than 5% of the shares and held them more than a year. Enter the total reduction on line 160 canada.ca.

Foreign currency. Exchange gains and losses on capital transactions are capital gains and losses under subsection 39(2) and go in Part 4 canada.ca.

Book gains. The gain on the financial statements comes out on Schedule 1, and the tax figure from Schedule 6 replaces it; see T2 Schedule 1 adjustments.

What happens to a net capital loss or an ABIL?

A negative amount P goes to amount Q and then to Schedule 4 line 210 canada.ca. It doesn't reduce net income. The net capital loss can reduce taxable capital gains of the three previous years and of any future year, and the CRA works it out at the 50% rate. A carryforward is claimed on T2 line 332 canada.ca. The T1 side is on the net capital loss page.

An ABIL is different. Part 7 takes the total loss on small business corporation shares or debt, multiplies it by 1/2, and sends amount G to Schedule 1 line 406 canada.ca. It reduces income from all sources. Any part the corporation can't use becomes a non capital loss, carried back 3 years and forward 10, and after that it turns into a net capital loss with no time limit canada.ca.