The T1135 Reporting Threshold: Do You Need to File in Canada?

Form T1135, the Foreign Income Verification Statement, only applies once your foreign holdings cross a specific dollar threshold set out in the Income Tax Act. Below that number, you generally don't need to file at all. Above it, the filing obligation applies to your entire combined foreign property for the year — not just the portion above the line. The trouble is that the threshold is calculated in a way that surprises a lot of people, because it isn't measured account by account.

This article explains how CRA calculates the threshold and what counts toward it. We deliberately don't quote a specific dollar figure here — always verify the current, exact threshold directly with CRA's guidance or a tax professional rather than relying on a number you saw somewhere online. Dollar thresholds in tax legislation can be updated, and getting this wrong has real consequences either way.

It's a Combined Total, Not a Per-Account Test

The single biggest misunderstanding about the T1135 threshold is thinking it applies separately to each foreign account or asset. It doesn't. CRA adds together the cost amount of every piece of specified foreign property you hold — every foreign bank account, every foreign shareholding, every foreign loan receivable, every applicable piece of foreign real estate — and compares that combined total to the threshold.

That means someone with modest amounts spread across three or four foreign accounts can trigger the filing requirement just as easily as someone with one larger account, once everything is added up.

What "Cost Amount" Means (and Why It's Not Market Value)

CRA measures the threshold using cost amount — generally your original acquisition cost, adjusted in certain circumstances — not the current fair market value of the property. This matters in two directions:

• If a foreign investment has grown significantly in value, you might still be below the filing threshold if your cost amount is well below the current market value.
• Conversely, if you paid a high price for something that has since dropped in value, your cost amount — and therefore your filing obligation — is based on what you paid, not what it's worth today.

Amounts in foreign currency need to be converted to Canadian dollars for this calculation.

How to Work Through the Calculation

1. List every foreign holding that fits within specified foreign property (see our companion article on what counts as specified foreign property).
2. Determine the cost amount of each one, converting foreign currency to Canadian dollars.
3. Add them all together to get your combined total for the year.
4. Check whether that total crossed the threshold at any point during the year — not just at year-end. Even a brief period above the line can be enough to trigger the requirement for the whole tax year.
5. If you're at or near the line, get a professional to confirm the current threshold figure and whether your calculation is right, rather than guessing.

Why You Shouldn't Rely on a Number You Read Online

Dollar thresholds in the Income Tax Act can be updated by Parliament, and older articles, forum posts, or social media threads may reference a figure that's since changed, or may simply be inaccurate. Filing when you didn't strictly need to is a minor inconvenience. Failing to file when you should have is a genuine compliance problem. Given that asymmetry, always confirm the current, exact threshold directly from CRA's guidance or with a tax professional before deciding not to file. If you'd like a professional to review your numbers first, Treadstone Law's flat-fee pricing is published upfront, so you know what a consultation costs before you commit to one.

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