Form T1135: Foreign Income Verification Statement Filing Guide

To file Form T1135, the Foreign Income Verification Statement, you complete either the simplified Part A or the detailed Part B based on the cost of your foreign property, then submit it to the Canada Revenue Agency by the same date your income tax return is due. The form is required if you are a Canadian resident and the total cost of your specified foreign property exceeded $100,000 CAD at any point during the year.¹ It reports what you own abroad and the income it produced; it does not calculate any tax.

Do You Actually Need to File

The trigger is cost, not market value. If the total original cost of your specified foreign property crossed $100,000 CAD at any moment during the year, you file — even if the value dropped below that line by December 31. Individuals, corporations, and trusts all qualify. Partnerships file when less than 90% of income or loss belongs to non-resident members or certain exempt entities.²

One boundary worth naming: if you became a Canadian resident for the first time during the year, you don’t file the T1135 for that calendar year.

Joint Ownership

The $100,000 threshold applies to your share of the cost, not the property’s total. Two people who jointly own a foreign account with a cost of $180,000 each hold $90,000, so neither files for that asset. When reporting income and capital gains, report your share only, even where income tax attribution rules require one spouse to claim all the income on their return.

What Counts as Specified Foreign Property

The category is broad and covers most financial interests and tangible assets outside Canada:¹

Funds held outside Canada, including bank accounts and term deposits at foreign institutions
Shares of non-resident corporations, and shares of Canadian companies held in accounts outside Canada
Debts owed by non-residents, such as bonds, mortgages, and notes receivable
Interests in non-resident trusts acquired for consideration
Real property outside Canada held for investment or rental
Intangible property such as patents and copyrights situated outside Canada
Precious metals, gold certificates, futures contracts held abroad, and interests in foreign insurance policies

Cryptocurrency on a foreign-based exchange is treated as specified foreign property. The CRA has acknowledged that pinpointing where crypto is located can be difficult and says the question is under review, so when the location is ambiguous, include it.

What’s Excluded

Some foreign assets don’t count toward the $100,000 threshold and don’t appear on the form:

Foreign property held inside an RRSP, TFSA, RESP, RRIF, or other registered plan³
Personal-use property, including a vacation home used mainly by you or your family, plus personal items like jewelry and art. A Florida condo you list on a short-term rental platform doesn’t qualify as personal-use in the CRA’s view.³
Assets used exclusively to carry on an active business¹
Shares or debt of a foreign affiliate, which are reported on separate forms¹

Choose Part A or Part B

The form has two reporting tiers. The one you use depends on the maximum total cost of your foreign property during the year.

Part A: Simplified Method

Part A applies if the total cost of your specified foreign property stayed below $250,000 throughout the entire year.¹ Rather than listing each asset, you check a box for every type of property you held and provide three summary figures: the country codes for the top three countries where your assets were concentrated (ranked by highest month-end cost), total income from all properties combined, and total capital gains or losses from dispositions.³

Pay attention to “throughout.” If the cost hit $250,000 even for a single day, Part A is off the table for that year.

Part B: Detailed Method

Once the total cost reaches $250,000 at any point, you must complete Part B.¹ Part B sorts property into seven categories: funds held outside Canada; shares of non-resident corporations other than foreign affiliates; debts owed by non-residents; interests in non-resident trusts; real property outside Canada; property held in an account with a Canadian registered securities dealer or trust company; and other property outside Canada.

For each individual asset you report the country where it’s located, the maximum cost during the year, the cost at year-end, the gross income it generated, and any capital gain or loss on its sale. Report the full capital gain, not the taxable portion.

Currency Conversion

Every figure goes on the form in Canadian dollars. Convert each amount using the Bank of Canada exchange rate in effect at the time of the transaction, or use the average annual rate for income reporting.¹ Daily and annual rates are on the Bank of Canada’s exchange rate page.⁴ Conversion mistakes are among the most common errors on this form, and a bad rate can move your reported cost across the $100,000 line, so verify the rate before you enter figures.

Cost of Inherited or Gifted Property

The threshold uses the “cost amount” as defined in subsection 248(1) of the Income Tax Act, which generally means the adjusted cost base.³ For inherited or gifted property, the cost base follows the general rules under the Income Tax Act, typically the fair market value at the time of transfer from the deceased or donor. If you received foreign property this way, confirm the deemed cost with your tax advisor before assuming it sits below $100,000.

Submitting the Form

Electronic filing is the simplest route. Individuals, corporations, partnerships, and trusts can all file the T1135 through EFILE or NETFILE, and you get immediate confirmation the CRA received it.⁵

On paper, attach the completed T1135 to your paper-filed income tax or partnership return, or submit it separately. Either way, it goes to the Winnipeg Tax Centre at Post Office Box 14001, Station Main, Winnipeg MB, R3C 3M3.¹

Filing Deadlines

The T1135 is due on the same date as your income tax return, even if no return is required for that year:³

Most individuals: April 30 following the tax year
Self-employed individuals, or those whose spouse is self-employed: June 15 following the tax year¹
Corporations: six months after the end of the fiscal year
Trusts: 90 days after the trust’s tax year-end

Fixing an Earlier Filing

If a filed T1135 contains an error — a missing asset, the wrong country code, an incorrect cost — you can submit an amended form. Check the “amended return” box and fill in every required field, not only the ones you’re correcting.³ Use the most current version of the T1135 for the amendment, even if the original was filed on an older version.

If You Missed a Prior Year Entirely

Where you failed to file for one or more previous years and the CRA has not contacted you about it, the Voluntary Disclosures Program may offer relief from penalties, part of the interest, and criminal prosecution.⁶ The disclosure has to be voluntary: once the CRA has begun an audit or issued a demand letter, the door has closed. Applications are evaluated case by case, and simply forgetting or leaving it to your accountant is not a defense.

What Happens If You Don’t File

Late or missing filings carry escalating consequences. The base penalty is $25 per day, with a minimum of $100 and a maximum of $2,500, running from the day after the deadline until the form is filed.⁷

If the CRA issues a formal demand to file and you still don’t comply, either knowingly or through gross negligence, the penalty rises to $1,000 per month for up to 24 months, capped at $24,000, less any base penalties already assessed.⁷ The gross negligence tier requires a CRA demand that you ignore.

There’s a separate consequence beyond dollars. A missed or inaccurate T1135 can extend the CRA’s reassessment window by three years when both of these are true: you failed to report income from a specified foreign property on your income tax return, and the T1135 was not filed, was filed late, or contained inaccurate information.³ For most taxpayers, that turns the normal three-year reassessment period into six.

1
Canada.ca. Foreign Income Verification Statement
2
Department of Justice Canada. Income Tax Act – Section 233.3
3
Canada.ca. Questions and Answers About Form T1135
4
Bank of Canada. Exchange Rates
5
Canada Revenue Agency. T1135 Foreign Income Verification Statement
6
Canada.ca. What Is the VDP – Voluntary Disclosures Program
7
Canada Revenue Agency. Penalties