How to Amend a Previously Filed Tax Return

How to change a tax filing to claim investment management fees

If you pay investment management fees for your non-registered investment account, those fees are generally tax-deductible. You can claim them on line 22100 — carrying charges, interest expenses and other allowable expenses. Fees charged for tax-preferred accounts, such as tax-free savings accounts (TFSAs) or registered retirement savings plans (RRSPs), are not deductible.

The Canada Revenue Agency (CRA) recognizes two main categories of deductible investment-related fees:

1. fees to manage or take care of your investments, and
2. fees (other than commissions) paid for advice on buying or selling a specific share or security, or for the administration or management of the shares or securities.

In practical terms, that means management fees that are charged as a percentage of your non-registered investment account are typically deductible. Commissions for buying or selling specific securities and mutual fund management expense ratios (MERs) are usually not deductible under this rule. In addition, the fees must be paid to a person or company whose principal business is advising clients on buying or selling specific securities, or whose main activity includes administering or managing shares or securities.

Can you claim a past expense on your current year’s tax return?

In most cases you cannot take a receipt from a previous year and directly claim it on the current year’s tax return. Deductible expenses should be claimed in the tax year in which they were incurred. Some items, though, are designed to be carried forward after being reported in the correct year — examples include charitable donations and capital losses. Those still must be reported in the year they arise, even if you plan to use them in a later year.

How to amend a previous tax return

If you discover you missed claiming deductible investment management fees in a prior year, you have options to correct that tax return. There are three common ways to request an adjustment with the CRA:

1. Submit a T1 adjustment request (T1-ADJ) using tax software or by mailing the completed form and supporting documents to the CRA tax centre that serves your area.
2. Send a signed letter to your tax centre describing the change and including copies of supporting receipts or statements.
3. Use the CRA’s online service and its “change my return” option to request the amendment electronically.

When you request an adjustment, include clear documentation showing the fees were paid in the year claimed, such as statements from your investment manager or account statements that itemize the charges. This will help the CRA process your request more quickly and minimize follow-up questions.

How many years back can you go to change your tax return?

The CRA normally accepts adjustment requests for any of the previous 10 calendar years. For example, in 2024 you could request changes to returns as far back as 2014. If you need to amend a return older than the usual period, you can still submit a written request, but the CRA’s standard practice is to limit adjustments to that 10-year window.

What if your adjustment results in tax owing?

If correcting a past return increases the tax you owe — for instance, because you omitted income or claimed an incorrect credit — the Voluntary Disclosures Program (VDP) may be an option. The VDP allows taxpayers to come forward voluntarily to correct past errors and, if accepted, can provide relief from penalties and potential prosecution. To be eligible, the submission generally must be voluntary, complete, relate to an issue that is at least one year past due, and include full disclosure of relevant information and documentation. Applicants should also provide payment of estimated taxes owing or request a payment arrangement.

To use the VDP, prepare a complete disclosure including all returns, forms and schedules needed to correct the omission, and submit it in writing following the CRA’s procedural guidance.

Claiming management fees on a previous tax return

Your non-registered management fees should be tax-deductible if they meet the CRA’s conditions. If the fees were paid in 2021 and 2022 and you didn’t claim them then, you can ask the CRA to adjust those returns. For recent years, an electronic or written adjustment is the simplest route. Be sure to provide clear documentation showing the fees were charged and the services they cover.

When preparing an adjustment request, include:

• the tax year being corrected and a brief explanation of the change;
• copies of account statements or invoices showing the management fees and the dates they were charged;
• any schedules or calculations that show how the deduction affects your overall tax position; and
• your contact details so the CRA can request additional information if needed.

Correcting prior returns can lead to a refund for overpaid tax, or it may increase the amount owing. If you expect to owe tax as a result of any other corrections you are making, consider whether a voluntary disclosure is appropriate. If you are uncertain about how to proceed, a tax professional can help you assemble the documentation and submit the adjustment in a way that follows CRA rules.

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