The capital gains change to the inclusion rate (1/2 to 2/3) will not occur until 2026

It is now official. The capital gains change to the inclusion rate (1/2 to 2/3) will not occur until 2026. That is of course subject to the Liberals, not the Conservatives, winning the next election or it may not happen at all.

In addition, the increase to the capital gains exemption will be raised to $1,250,000 from June 25, 2024.

The new Canadian Entrepreneurs’ Incentive will also proceed from 2025 onward as announced. The inclusion rate will be 1/3 on up to $400,000 of eligible capital gains.

None of this is law and a new bill would have to be introduced. So we are not done with the “capital gains chaos” but at least some clarity is emerging.

CRA Guidance on today's Capital Gains rate change deferral:
- CRA has reverted to administering the currently enacted capital gains inclusion rate of one-half.
- hashtag#T1 and hashtag#T3 forms reflecting the changes will be released in the coming weeks.
- CRA will grant relief in respect of hashtag#late-hashtag#filing hashtag#penalties and arrears interest until June 2, 2025, for impacted T1 Individual filers and until May 1, 2025, for impacted T3 Trust filers to provide additional time for taxpayers reporting capital dispositions to meet their tax filing obligations.
- hashtag#Corporations can continue to use existing forms and tax software to file using the one-half inclusion rate until further notice. CRA will coordinate corrective reassessments to reverse the application of the two-thirds inclusion rate for those that have already filed that way.
- CRA will administer the hashtag#capital hashtag#gains hashtag#exemption increase to $1.25 million.