Line 40427 – Minimum tax carryover
If you paid minimum tax on any of your 2015 to 2023 returns, but you do not have to pay minimum tax for 2024, you may be able to claim credits against your taxes for 2024 for all or part of the minimum tax you paid in those years.
To calculate your claim, complete the parts of Form T691, Alternative Minimum Tax that apply.
Minimum tax
Minimum tax limits the tax advantage you can receive in a year from certain incentives. You have to pay minimum tax if it is more than the federal tax you calculate in the usual manner.
To find out if you have to pay this tax, add the amounts shown in B below and 60% of the amount on line 12700 of your return. If the total is $40,000 or less, you probably do not have to pay minimum tax. If the total is more than $40,000, you may have to pay minimum tax. Therefore, complete Form T691, Alternative Minimum Tax.
You also may have to complete Form 428 or Form T2203, Provincial and Territorial Taxes for Multiple Jurisdictions, to calculate additional provincial or territorial tax for minimum tax purposes.
Here is a list of the most common situations where you may have to pay minimum tax:
A. You reported a taxable capital gain on line 12700 of your return.
B. You claimed any of the following on your return:
- a loss (including your share of a partnership loss) resulting from, or increased by, claiming capital cost allowance on rental properties
- a loss from a limited partnership that is a tax shelter
- most carrying charges (line 22100) on certain investments
- a loss from resource properties resulting from or increased by claiming a depletion allowance, exploration expenses, development expenses, or Canadian oil and gas property expenses
- a deduction on line 24900 for security options
C. You claimed any of the following tax credits on your return:
- a federal political contribution tax credit on line 41000
- an investment tax credit on line 41200
- a labour-sponsored funds tax credit on line 41400
- a federal dividend tax credit on line 40425
Completing your tax return
Complete Form T691 to calculate your claim for minimum tax carryover and enter the result on line 40427 of your return.
If you are filing electronically, keep your Form T691 for your records. If you are filing a paper return, attach your Form T691.
Be sure to complete Form 428 for your province or territory of residence as the provincial or territorial credit is calculated separately.
For Quebec residents, complete the corresponding form and attach it to your provincial tax return for Quebec.
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