This short guide covers the basics of filling out your T776 form for rental income. If you need more information, the CRA has an in-depth guide that covers these topics in greater detail.
Enter the identifying information for your rental property in this tab.
Address: Enter the address of the rental property (if you have more than one, enter the address from which you earn the most income). If your property was located outside of Canada, enter the property’s street address, city, and country, but enter your own Canadian postal code.
Co-owner or a partner? Most of the time, if you own the rental property with other people, you are a co-owner. Learn more.
Fiscal period: If this is the first year renting your property, enter the year, month, and day you began your rental operation. Otherwise, leave it as January 1. All rental property operations have a December 31 year‑end.
Co-owner (or partner) information
This tab only appears if you indicated this was a co-ownership or partnership.
Enter your percentage of the co-ownership/partnership in the first row of the table. Add information about your co-owners/partners in the subsequent rows.
If you share a Wealthsimple Tax account with your co-owner/partner you can share the T776 from this section so you don’t need to enter the information twice. Keep in mind certain “selfish” fields (like the Co-owner/Partner table) will need to be completed in both profiles. Learn more.
Income & Expenses
Use this tab to report your income and certain expenses.
Gross rents: Enter the gross rents from your main rental property in the first row. If you have other rental properties, use the “Add another unit” button to report income from each additional property.
Other related income: Include any income that you receive that isn’t specifically rent but that is related to the rental property.
Expenses are broken out into two types:
- current - these are expenses that provide a short-term benefit. These can be deducted from your gross rental income in the year and are claimed in the Income and Expenses tab.
- capital - these are expenses that provide a benefit that lasts multiple years. These can be deducted over a period of years and are claimed in the Capital Cost Allowance (CCA) tab.
Here’s more information from the CRA on how to determine whether an expense is a current or capital expense.
Report your current expenses in this tab. They can be reported in three different ways:
If you have tracked your rental expenses separately from your personal expenses, enter only the total rental expenses in the “Total expense” column and do not use the “Personal use portion” fields.
If your expenses were for both rental and personal use, and all of your expenses were incurred at exactly the same personal use rate, you can use the “Personal use portion field” that appears above all of the expenses fields.
If your expenses were for both rental and personal use, but all the expenses didn’t incur the same personal use rate, leave the “Personal use portion (if it’s the same for all your expenses)” field blank, and instead enter your personal portion per expense in the “Personal portion” column.
If you are a co-owner or partner, use the first option (enter the total expenses for the property in the first column only).
If you have any questions about what can be deducted in each category, use the links in the Expenses section.
Capital Cost Allowance (CCA)
Use this tab to report your capital expenses. If you have motor vehicle expenses, don’t include them in the Capital Cost Allowance (CCA) tab; use the Motor Vehicle Expenses tab(s) to claim both motor vehicle expenses and CCA for the vehicle.
If you own more than one rental property, you have to calculate your overall net income or loss for the year from all your rental properties before you can claim CCA. You cannot use CCA to create or increase a rental loss.
The amount of CCA you can claim depends on the type of capital property you own and the date you acquired it. For each, you’ll need to figure out what class it belongs to. Here’s a list of common classes.
You can choose whether you want to report only the totals of your CCA or have Wealthsimple Tax calculate this for you. If you fall under any of the limitations described below or if you have already done the CCA calculations as part of your annual accounting, you should use the “report totals only” option and track your CCA manually. Reporting totals sends the same information as using the Wealthsimple Tax CCA tables, so your audit risk will not increase.
Additions and dispositions table
Type: If you acquired or disposed of a capital property in the year, report this in the “Additions & Dispositions” table.
Class: Select the CCA class relevant to the capital property you’re adding or disposing of.
Total cost/Proceeds: Enter the amount you paid for or sold your capital property for (whichever is applicable) in the Total cost/proceeds column. Enter the values in positive numbers; the choice of addition or disposition in the “Type” column will determine whether the amount is used as an addition or disposition in the CCA calculation.
PUR(%): If you use a given capital property for both your personal needs and the needs of the rental property, you will have to determine what your personal use rate is. For example, if you use an item 75% of the time for the rental property and 25% for your own use, enter 25.
If your personal use rate for the property won’t change from year to year, enter your personal use rate in the PUR column. If your personal use rate may change from year to year, leave this column blank. You can fill in your current year personal use rate in the next table.
Business part: This is the amount for your addition/disposition that will be included in the overall CCA calculation. If you entered a PUR amount, Business part will be the amount of the cost/proceed that is for the business only. If you didn’t enter a PUR amount, it will be the same as the cost/proceed amount.
This column will also take into account and calculate the half-year rule for any additions.
Wealthsimple Tax will automatically add these additions and dispositions to the CCA calculation table. If you have multiple additions/dispositions under the same class, these will be grouped together on one line in the CCA calculation table.
CCA calculation table
Class: Select the CCA class relevant to the capital property for which you want to claim CCA.
UCC Start: If you have any CCA classes with a closing Undepreciated Capital Cost (UCC) balance from last year, add last year’s UCC end amount into the UCC Start column (if you used Wealthsimple Tax last year, we’ll carry these forward for you automatically). Because CCA is a class-based system you should generally only have one row per class.
However, if you have two capital expenses with the same class but each has a different PUR rate, then each should be reported in its own row so that the proration of the expense with the higher PUR isn’t applied to the expense with the lower PUR.
Additions/Proceeds: These fields will automatically be filled out with the information from the Additions and Dispositions table above.
PUR(%): If you have a personal use rate for the class for the year, enter that in the PUR column. Your maximum CCA will be decreased by the percentage of your personal use of the capital property.
Max CCA: The maximum CCA that can be claimed based on the information provided in the previous columns will be calculated in this column. If your fiscal year is not a full year (it’s the first/last year of your rental business), this amount will be prorated.
CCA Claimed: If you want to claim a different amount than the maximum allowable CCA, enter that amount in the CCA Claimed column. You might want to do this if you are already in a loss position this year (remember, you can’t use CCA to create or increase a loss), or you think you might be in a higher tax bracket next year.
If you have a recapture we’ll include this in your income for you.
If you have a disposition for less than your UCC start, you have a terminal loss. If you have a terminal loss, don’t include it in the CCA table; instead claim it in this field. Learn more
Wealthsimple Tax CCA tables don’t support:
- Assets (other than Class 10.1 vehicles) that are able to be allocated to their own class (rather than grouped with items of the same class).
- Assets that are eligible for straight line depreciation.
- Classes in which you have a terminal loss.
Motor vehicle expenses
Use this tab to claim the cost of your vehicle if you use it for your rental property. If you didn’t keep a detailed log book and receipts you might not want to claim this amount. The CRA is known to often request records for motor vehicle claims. Here’s more information from the CRA on how to complete this section.
The motor vehicle expenses you can claim are different depending on the number of rental properties you own. Here’s more information from the CRA on the different expenses you can claim.
If this is a co-ownership or partnership, there will be two separate Motor Vehicle Expenses tabs, one for your personal motor vehicle(s) and one for any motor vehicle(s) owned by the co-ownership/partnership.
Use this tab to report any other rental information. This includes:
- GST/HST number, if applicable
- tax shelter number, if applicable
- if this was your first or final year of business
- debts that exist with respect to the property
There are a few additional pieces of information needed from Québec residents specifically for their provincial tax return.
Québec CCA Calculation
The amount of CCA that you claim on your federal return and provincial return may be different so we provide a separate table for claiming CCA on your Quebec return. There are also certain classes of CCA that have different rules for Québec than for federal. Learn more.
Other than the differences in what can be claimed and how the classes behave differently, the Québec CCA Calculation table works the same as the CCA Calculation table.
Costs Incurred for Work on a Property
If you have contractors who do repair work on your rental property, Revenu Québec asks you to provide information about the contractors and the work done. Learn more.