T691: Alternative Minimum Tax

What’s in this article?

 

What is this?

Form T691 is used to calculate the federal tax payable under the Alternative Minimum Tax (AMT). The AMT is a separate way of calculating tax where the minimum tax exceeds the amount of tax payable under the regular tax calculation. The AMT was designed to address public concern about the possible unfairness of a system where high-income Canadians pay little or no tax.

You may have to pay minimum tax if you claimed any of the following and if your adjusted taxable income is more than the basic exemption of $40,000 as calculated on form T691:

  • Taxable capital gain;
  • Loss from claiming capital cost allowance on rental properties;
  • Loss from a limited partnership;
  • Most carrying charges on certain investments;
  • Loss from resource properties resulting from, or increased by, claiming a depletion allowance, exploration and development expenses, and Canadian oil and gas property expenses;
  • An ​employee home relocation loan deduction;
  • Security options deduction;
  • Federal political contribution tax credit;
  • Investment tax credit;
  • Labour-sponsored funds tax credit;
  • Federal dividend tax credit; or
  • Overseas employment tax credit.

Note: If you paid minimum tax on any of the preceding seven years and are not subject to AMT in the current year, you may be able to claim credits against your taxes for the current year for all or part of the minimum tax paid previously. To do so, you must complete the applicable sections of form T691.         

If you are a Québec resident, complete form TP-776.42-V: Alternative Minimum Tax to calculate the minimum tax payable or if you want to claim a deduction for AMT paid in the preceding seven years.

 

Am I eligible?

If you claimed any of the following amounts or credits, you must complete form T691 to determine if you are subject to AMT.

  • Taxable capital gain or loss, including from claiming capital cost allowance on rental properties;
  • Loss from a limited partnership;
  • Most carrying charges on certain investments;
  • Loss from resource properties resulting from, or increased by, claiming a depletion allowance, exploration and development expenses, and Canadian oil and gas property expenses;
  • An ​employee home relocation loan deduction;
  • Security options deduction;
  • Federal political contribution tax credit;
  • Investment tax credit;
  • Labour-sponsored funds tax credit;
  • Federal dividend tax credit; or
  • Overseas employment tax credit.

If your adjusted taxable income is greater than the basic exemption amount of $40,000 as calculated on form T691, you may have to pay minimum tax.

Note: If you are a trust, do not use this form. Instead, use Schedule 12 of the T3 package to calculate the AMT.

 

Where do I claim this?

Follow these steps in H&R Block’s tax software to file your 2015 taxes:

  1. Click the PREPARE tab.
  2. Click the OTHER icon. You will find yourself here:
  3. Under the MISCELLANEOUS section, select the checkbox labelled Alternative minimum tax (T691).
  4. Scroll to the bottom of the page and click Continue.

When you arrive at the page for the Alternative minimum tax (T691), enter your information in the software.

  

Where can I learn more?