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ACB after your put is assigned: a full Canadian example

When your put is assigned, the premium you got lowers the adjusted cost base (ACB) of the shares. When your call is assigned, the premium is added to the sale price. Here's a full cycle, worked out, where the trade loses.

Options guide · 9-minute read · Updated 2026-10-28

The short answer

Your Adjusted cost base (ACB) is what your shares cost you for Canadian tax. When a put you sold is assigned, the rule is simple:

ACB = (strike × 100) − the premium you got + any fees.

Sell a $45 put for $1.00 and get assigned, and your ACB is $4,400, or $44 a share. When a call you sold is assigned, the premium goes the other way. It's added to your sale proceeds.

This matters in a regular, non-registered account. In a TFSA or RRSP, there's no ACB to track for tax. More on that below.

The loop of selling puts and then calls is the wheel strategy. For the rest of the Canadian picture, see selling options in Canada.

One wheel cycle, line by line (hypothetical)

All numbers are made up, in Canadian dollars, in a regular account. The stock is a made-up company, XYZ, listed in Toronto. We ignore fees to keep the math clean. In real life, add them to your ACB.

Step 1, March. XYZ is at $48. You sell one $45 put for $1.50. You collect $150.

Step 2, April. XYZ falls to $42. You're assigned. You buy 100 shares at $45, or $4,500. Your ACB: $4,500 − $150 = $4,350 ($43.50 a share).

Step 3, May. XYZ is at $39. You sell one $43 call for $0.80, and collect $80. It expires. XYZ is at $38. That $80 is a capital gain on its own. It does not change your ACB. Only an assigned call touches the shares.

Step 4, June. You sell a second $38 put for $1.20, collecting $120. XYZ falls to $35. You're assigned again: 100 more shares at $38, or $3,800. This lot's cost: $3,800 − $120 = $3,680.

Step 5, the pool. Canada uses average cost. Identical shares in all your non-registered accounts are pooled into one ACB. You don't track lots separately.

Step 6, August. XYZ has slid to $33. You decide you're done and sell all 200 shares for $6,600.

Where that leaves you

The two put premiums aren't missing. They're already inside the $8,030. That's why you don't report them a second time.

Only half of a capital loss is usable, the same as a gain. The usable part offsets capital gains this year, the three years before, or any year after. It can't offset your salary.

What if the call had been assigned?

Change Step 3. XYZ jumps to $46 before expiry, and your $43 call is assigned. You sell 100 shares at $43.

• Proceeds: $4,300 + the $80 premium = $4,380
• ACB: $4,350
• Capital gain: +$30

So the premium joins the sale price, not the cost. And there's no June put, no pool, and no August sale. A small gain instead of a big loss. The difference between those two paths is the whole story of the wheel: the premiums are small, and the share price decides the result.

When the trade crosses a year-end

Say you sell a put in December and it's assigned in January. At the end of December, the put was open. Many people report the December premium as a gain for that year.

Then the January assignment moves that premium into the shares' ACB instead. The first year's return may need a fix. Bring this one to your tax preparer.

Why none of this applies in a TFSA or RRSP

Inside a TFSA or RRSP, gains aren't taxed year by year. So there's no ACB to report, and no capital loss to claim.

That cuts both ways. The −$1,430 loss above, inside a TFSA, can't offset anything. And your TFSA room doesn't come back. You still want a record of what you paid, to judge your own trades, but the CRA doesn't need it.

One trap does cross over. If you sell shares at a loss in a regular account and buy them back in your TFSA within 30 days, the loss is denied. See the superficial loss rule with options.

Keep this record for every trade

1. Date, strike and premium of every option, in Canadian dollars.
2. How it ended: expired, bought back, assigned or called away.
3. The running pooled ACB after every buy and sale.
4. Fees, added to cost or taken off proceeds.
5. For US stocks, the exchange rate on each trade date.

Your broker's T5008 slip may show a cost that ignores the premium. Your own record is what's right. See how to report options on a Canadian tax return. Our ACB calculator for options keeps the running pool for you. For the US view of the same idea, see cost basis. As of October 2026, the CRA's Capital Gains guide (T4037) is where to check the current rules.

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