The CRA's IT Bulletin on Condominiums states "no deduction or capitalization of the expense (reserve fund) is
permitted until the amount is laid out to earn income by the
condominium corporation".
This means you should subtract the portion of the reserve fund from the condo fees prior to reporting the deduction as a current expense on your tax return. Then when the condo corporation incurs an expense from this fund for maintenance, repairs, improvements or additions to
the common elements, you may claim a current expense or capitalize it depending on the nature of the work.
Here's the CRA documentation referred to: https://www.canada.ca/content/dam/cra-arc/formspubs/pub/it304r2/it304r2-e.pdf
