💼 Tax

Superficial Loss — the 30-day rule

Published May 13, 2026 · 7 min read · By the WealthWise team · Updated June 20, 2026

⚠️ For informational purposes only. This article presents facts and concepts. WealthWise is not a registered investment advisor. For any investment decision, consult a licensed advisor with your provincial regulator.

Superficial loss is a CRA anti-avoidance rule: if you sell at a loss then repurchase the same security within 30 days, the loss is denied and added to the new lot’s ACB.

In short — CRA superficial loss: sell at loss then repurchase within 30 days = loss denied. How to avoid it for tax optimization.

#	Condition
1	You (or affiliated person: spouse, trust, controlled corp) repurchase identical security
2	Within 61-day window (30 days before + sale day + 30 days after)
3	You still own it at day 30 after the sale

1. Precise definition

A loss is superficial if:

You (or affiliated person: spouse, trust, controlled corp) repurchase identical security
Within 61-day window (30 days before + sale day + 30 days after)
You still own it at day 30 after the sale

Step	Detail	Amount
Starting position	Hold 100 XEQT at $35 (original ACB)	$3,500
Sale (Dec 15)	Sell 100 XEQT at $30	$3,000 proceeds
Loss realized	Loss on sale	$500
Repurchase (Dec 20)	Buy back 100 XEQT at $30	$3,000
CRA treatment	Loss denied, added to new ACB	New ACB = $3,000 + $500 = $3,500

2. Worked example

You hold 100 XEQT at $35 (ACB $3,500). Dec 15, XEQT at $30.

Sell: 100 × 30 = $3,000. Loss: $500
Buy back Dec 20: 100 XEQT at $30 = $3,000
CRA: loss denied. New ACB = 3,000 + 500 = $3,500

Lean allowed (loss stands)

Buy a similar but distinct security instead (e.g. sell XEQT, buy VEQT)
Wait at least 31 days minimum before repurchasing the same security
Distinct securities (same family but different ISIN): loss allowed

Lean denied (superficial loss)

You (or affiliated person: spouse, trust, controlled corp) repurchase identical security
Repurchase happens within the 61-day window (30 days before + sale day + 30 days after)
You still own it at day 30 after the sale
A reinvested DRIP dividend falls within the 30-day window

3. Tax-loss harvesting (legal)

Sell at loss year-end to reduce gains. To allow:

Buy similar but distinct security (sell XEQT, buy VEQT)
Wait 31 days minimum before repurchasing same

4. Common trap: automatic DRIP

Verify no DRIP transaction falls within 30-day window. One reinvested dividend can invalidate the whole loss.

5. Spouse and affiliated parties

If spouse buys same security within 30 days, rule applies. Same for controlled corps or family trusts.

6. Documentation for CRA

Keep all statements for 6 years. When in doubt, compute adjusted ACB yourself rather than trusting your broker.

Frequently Asked Questions

Sell XEQT, buy VEQT: superficial loss?

No, distinct securities (same family but different ISIN). Loss allowed.

Does superficial loss apply to TFSA?

No. TFSA being tax-free, gains and losses are not reportable.

Minimum days before repurchase?

At least 31 days after sale (or before if prior purchase).

What happens to denied loss?

Added to ACB of repurchase. You recover the loss later when definitively selling.

Sources & references

Educational content. Figures and rules verified against the official sources above; tax amounts change annually.