T5 – Investment Income

As your investments grow, it becomes important to track the income they generate and how it’s taxed. The T5 Statement of Investment Income reports interest, dividends, and other earnings from non-registered accounts, and it plays a key role in your tax return.

At Optimize, we use your T5 to assess tax efficiency, plan withdrawals, and shape strategies that align with your goals. Understanding it helps you see how your investments affect your taxable income each year.

The Foundation of Investment Income Reporting

The T5 form is issued by financial institutions or investment providers when the income you earn from non-registered investments meets or exceeds certain thresholds. You might receive a T5 if you:

Earned more than $50 in interest or dividends from a savings account, GIC, or bond.
Held dividend-paying stocks or Canadian mutual funds in a non-registered account.
Received income from a segregated fund, mortgage investment corporation, or corporate bond.

Your T5 slip reports a range of investment income types, including:

Interest income.
Eligible and non-eligible dividends from Canadian companies.
Foreign income and taxes paid to other countries.
Royalties or other specified investment income.

Each type of income is taxed differently, which is why it is important to know how it appears on your tax return.

Why the T5 Matters in Your Financial Plan

T5 slips tell a story about how your money is working for you outside of registered plans. They also remind us that every source of income has a tax impact. This matters when you are:

Holding investments in a non-registered account alongside RRSPs or TFSAs.
Earning dividend income as part of a broader cash flow plan.
Trying to reduce or manage your overall taxable income in retirement.
Planning charitable donations or tax-loss harvesting to offset investment income.

Learn how to read a T5 form to better understand the details and terminology used throughout your return.

Even if you reinvested the income rather than withdrawing it, T5-reported amounts are still taxable. That is why we look carefully at the form each year as part of your tax planning and income strategy.

Tip: T5 slips often cover multiple types of investment income. Matching each amount to the right section of your T1 helps us calculate your tax accurately and assess opportunities to improve tax efficiency in the future.

Learn How to Read a T5

Understanding your T5 helps you see how interest, dividends, and other investment income affect your taxes and financial plan. Whether from a joint, corporate, or personal account, it shows what you earned and how it’s taxed.

At Optimize, we believe clarity around tax slips leads to better decisions. This article explains the T5 in simple terms so you can approach tax season with confidence.

Identification and Basic Information

This section identifies who earned the income, where it came from, and for which period.

Recipient’s name and address
Confirms that you are the person who earned the income and should be reporting it on your return.

Payer’s name and address
The institution or company that paid the income — usually a bank, brokerage, or trust company.

Tax year
Indicates the year during which the income was earned. You must report it for the same calendar year.

Account number
Used by CRA and your financial institution to track the source of the income.

Interest, Dividends, and Other Investment Income

This section lists different types of investment income earned in non-registered accounts. Each type of income is taxed differently and shows up on a different line of your T1 return.

Box 13 – Interest from Canadian sources
This includes interest from bank accounts, GICs, and bonds. Fully taxable at your marginal rate and reported on Line 12100.
Box 14 – Other income
May include income that doesn’t fall into a specific category, such as certain structured products. Also taxed at your marginal rate.
Box 24 – Actual amount of dividends other than eligible dividends
Typically applies to private corporations. Reported on Line 12010 and grossed up by 15 percent.
Box 25 – Actual amount of eligible dividends
Dividends from public Canadian corporations. Reported on Line 12000 and grossed up by 38 percent for tax purposes.
Box 26 – Other income from Canadian sources
Can include royalties or income not categorized elsewhere. Reported on Line 13000.

Important: If you received dividends, they are “grossed up” for tax purposes — meaning the taxable amount on your return will be higher than the actual cash you received. This is offset by the dividend tax credit, which reduces your tax owing.

Foreign Income and Tax Paid

These boxes relate to investment income earned outside Canada, which may be taxed in both countries unless properly reported.

Box 15 – Foreign income
Income such as dividends or interest earned from foreign investments. Reported in Canadian dollars on Line 12100.
Box 16 – Foreign tax paid
Shows any foreign withholding tax that was deducted before income was paid to you. May be claimed as a foreign tax credit on Line 40500.

Tip: If your foreign income is significant, Optimize may recommend strategies to reduce tax drag — including moving foreign holdings to your RRSP or other registered accounts where the income is sheltered.