What happens to non-registered account capital gains and losses?

The correct understanding of capital gains and losses in non-registered accounts is that both gains and losses must indeed be reported. When an individual sells an asset from a non-registered investment account, any capital gains realized from the sale are subject to taxation. Meanwhile, capital losses can also be reported and may be used to offset capital gains, potentially reducing the taxable amount.

In Canada, all capital gains are included in income for tax purposes at a specific inclusion rate, while capital losses can be noted to reduce taxable gains. Therefore, statements suggesting that only losses need to be reported or that they do not need to be reported at all are inaccurate. It's also important to note that while capital gains may attract a lower tax rate compared to regular income, this does not imply that they are excluded from reporting requirements.

Thus, the responsibility to report both gains and losses emphasizes the importance of accurate tax reporting and the ability to utilize capital losses for better tax management.