I was advised that the Capital Dividend payment was tax-free to shareholders who are residents of Canada.
You are correct these dividends are tax-free.
Quoting directly from the CRA website link below: "This Chapter discusses capital dividends and the capital dividend account (CDA). The CDA keeps track of various tax-free surpluses accumulated by a private corporation. These surpluses may be distributed tax-free in the form of capital dividends to the corporation’s Canadian-resident shareholders. A corporation paying a capital dividend must file an election in respect of the dividend when the dividend is paid or becomes payable (capital dividend election). In certain circumstances, a late-filed election is acceptable (late-filed capital dividend election). If the corporation pays a capital dividend which exceeds the balance in its CDA, there will be additional tax consequences."
From my quote above - Income Tax Folio S3-F2-C1, Capital Dividends: https://bit.ly/2Aacdh3
Here is a link from TurboTax to guide you with your foreign sources: How do I report foreign income, pension, and other foreign amounts? - https://bit.ly/2BuCFAf
Also from TaxTips - Capital Dividend: https://www.taxtips.ca/glossary/capital-dividend.htm
Will Turbotax calculate Capital Dividends and maintain year to year balances?
Yes, TurboTax will calculate Capital Dividends and maintain year to year balances.
kanikabangia
New Member
VanMatt2010
New Member
philippareid13
New Member
cranston.crystal
New Member
megh87576
New Member
You have clicked a link to a site outside of the TurboTax Community. By clicking "Continue", you will leave the Community and be taken to that site instead.