T1135 (Foreign Income Verification)

The T1135 is a form the CRA requires you to file if the total cost of your foreign property exceeds $100,000 Canadian at any point during the tax year. This applies to investments held in non-registered (taxable) accounts. It does not apply to investments inside your TFSA, RRSP, or other registered accounts.

Foreign property includes stocks listed on U.S. or international exchanges, foreign ETFs, foreign bonds, real estate outside Canada, and foreign bank accounts. Canadian-listed ETFs that hold foreign stocks (like a Canadian-domiciled S&P 500 ETF) generally do not count, because the ETF itself is Canadian property.

Why it matters

The $100,000 threshold is based on the cost of the investments, not their current market value. If you bought $105,000 worth of U.S. stocks over the years and they’ve dropped to $80,000 in value, you still need to file because the cost exceeded $100,000.

Many Canadians trip the T1135 threshold without realizing it, especially if they’ve been steadily buying U.S. stocks or ETFs in a non-registered account. Missing the filing can result in penalties. The late-filing penalty is $25 per day, up to $2,500.

There are two levels of reporting. If your foreign property cost between $100,000 and $250,000, you can use the simplified method (just country and category). Above $250,000, you need to provide detailed information for each property.

Example

Say you hold $80,000 in U.S. stocks in a non-registered account and then buy another $25,000 worth of a U.S.-listed ETF. Your total cost is now $105,000, which crosses the $100,000 threshold. You need to file a T1135 with your tax return that year. If you forget and file four months late, the penalty would be around $3,000 ($25 per day for 120 days).

We cover the details, common mistakes, and how to stay on top of it in our T1135 guide.