🇨🇦 Canada · 5 min read · Published 2026-09-07 · Updated 2026-09-07

Written by Jordan Reeves · Editorial review: automated source and figure checks (how we check this)

Sources last verified: 2026-09-07

What Is the Superficial Loss Rule?

A capital loss is denied if you or an affiliated person buys the same property within thirty days before or after the sale and still holds it at the end of that window. The loss is not destroyed. It is added to the cost base of the repurchased property.

60-SECOND ANSWER

A loss on a security repurchased within thirty days is denied and added to the new cost base, deferring the deduction rather than eliminating it.

The answer:: The window runs thirty days before and thirty days after the sale, and the property must still be held at the end of it.
The trap:: Repurchasing inside a spouse's account or a corporation you control. Affiliated persons trigger the rule as surely as you do.
The recommendation:: Wait out the window, or buy something similar but not identical, so the exposure is maintained without denying the loss.

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Where the AI summary above gets this wrong

"You cannot claim a capital loss if you buy the stock back within 30 days."

That's surface-true. Here's what it misses:

The window is sixty days wide — Thirty days before the sale as well as thirty after. A purchase made shortly before selling triggers the rule too.
Affiliated persons count — A repurchase by your spouse, or by a corporation either of you controls, denies the loss exactly as your own repurchase would.
The loss is deferred, not lost — It is added to the adjusted cost base of the repurchased property, so it reduces the gain or increases the loss on the eventual sale.

→ See what a deferred loss is worth at your rate

01 What the rule actually covers

A superficial loss arises when identical property is acquired in the period beginning thirty days before the sale and ending thirty days after it, and is still held at the end of that period. The window is sixty-one days wide in total, not thirty.

Because the earlier half exists, an investor who buys more of a holding and then sells the older units at a loss shortly afterward can trigger the rule without ever repurchasing anything after the sale.

Source: Capital gains (line 12700)

02 Who counts as you

The rule reaches beyond your own accounts. A purchase by your spouse or common-law partner, or by a corporation controlled by either of you, is treated as your purchase and denies the loss.

Repurchasing inside a registered account is worse than a denial: the loss is denied outright and no cost-base adjustment is available, because a registered account has no capital gains treatment to adjust. The technique this defeats is described in tax-loss harvesting.

WORKED EXAMPLE · Try the numbers

Shows: what a given amount of additional taxable income costs you in tax at your marginal rate, and what you keep. Ignores: provincial surtaxes, credits that phase out with income, and any effect on income-tested benefits.

Amount ($)

Your marginal rate (%)

What you keep after tax

$6,700

At a 33% marginal rate, $10,000 costs $3,300 in tax and leaves $6,700.

Source: Capital gains (line 12700)

03 Why the loss is not lost

A denied superficial loss is added to the adjusted cost base of the repurchased property. When that property is eventually sold outside the window, the higher base produces a smaller gain or a larger loss, recovering the deduction.

The cost is timing, and for someone with gains to offset this year that timing matters. Waiting out the window, or buying a similar but not identical security, keeps market exposure while preserving the deduction.

Selling a similar rather than identical security is the usual way to stay invested through the window. Two broad index funds tracking different but closely related benchmarks are not identical property, and the exposure lost over thirty days is smaller than the deduction preserved in almost every case.

Source: Canadian income tax rates for individuals

The registered-account version of this is the one that actually hurts. Sell in your taxable account, buy the same fund in your TFSA the next day, and the loss is gone with no cost-base adjustment anywhere to recover it. That is a permanent cost for a one-day convenience.