Swift Accounting & Business Solutions Ltd.
2440 Kensington Rd NW, Calgary, AB T2N 3S1
(403) 999-2295 · mailbox@swiftltd.ca
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Section 85 Rollover Calculator (2026)
Enter the property, the note or cash you take back and the elected amount. See the tax triggered, the cost base of your shares and their paid-up capital.
Enter the fair market value to see the rollover.
Tax triggered by the transfer
The tax shown is the extra tax this year on top of your other income, with the election filed on time.
Estimate based on 2026 rules. Not tax advice.
How it's calculated
- The elected amount runs from the larger of the boot and the lesser of fair market value and cost (UCC for depreciable property) up to fair market value. Blank uses the minimum.
- Tax now is the extra personal tax on any gain above cost, or on recapture of capital cost allowance, stacked on your other income.
- The shares you receive have a cost base of the elected amount less the boot. Paid-up capital is capped at the same amount (section 85(2.1)).
- Private company shares moved to a corporation you or your family control fall under section 84.1. Boot above the larger of old paid-up capital and hard cost base is a deemed non-eligible dividend.
- The lifetime capital gains exemption can shelter a gain on qualifying small business shares. It can trigger alternative minimum tax, which is not calculated.
Frequently asked questions
What is a section 85 rollover?
It lets you transfer property to a Canadian corporation at an amount you choose, usually your cost, so the gain is deferred instead of taxed. The corporation takes that amount as its cost, and you receive shares, a note or both.
What is boot?
Boot is anything you take back other than shares, such as a promissory note. It sets the lowest elected amount you can choose. Boot above your cost triggers a gain, and for private company shares it can also trigger a deemed dividend under section 84.1.
What is the hard cost base?
It is your cost base without gains you already sheltered with the lifetime exemption. Under section 84.1, the larger of old paid-up capital and hard cost base is the most boot you can take back before a deemed dividend arises.
How is the election filed?
You and the corporation both sign Form T2057 and file it by the earlier of your two filing due dates for the year of the transfer. Late elections carry penalties, and a missed election can cost you the deferral.
Can I roll land and a building together?
Not here. Land and a building are separate properties with their own elected amounts and allocation rules. Run each one on its own, and ask a Swift accountant before you file.
Talk to a Swift accountant
Planning a rollover? A Swift accountant can set the elected amount and prepare the election.