Hi everyone,
Sorry in advance if this question is completely dumb! I’m trying to understand the consequences of a stock splitting and how it will affect how the CRA treats the eventual sale.
To try to make it as simple as possible, in November of 2021, I bought 54 shares of Hut 8 mining for $1000.
In December 2023, Hut 8 underwent a 5 for 1 reverse stock split, leaving me with 10 shares. When I look on my TD app now, it shows that the book cost for buying these shares was $144 and that they are now worth $750, leaving me with a “profit” of $607. However, in reality, I’m still down $250 compared to what I originally paid.
While I have no immediate plans to sell (hoping to at least get to a point where I can break even lol), I’m wondering the tax implications of the way it’s currently laid out in my account. If I were to sell now, at an actual loss of $250, in the eyes of the CRA would this still be viewed as a profit?
Thanks in advance, I really appreciate any clarification anyone could offer. Clearly I’m not very knowledgeable on the topic, lol 😬