Canada Capital Gains Tax Calculator
How much tax will you pay when you sell investments or a rental property? This calculator applies the 50% inclusion rate and your combined federal + provincial marginal rate.
How to use this calculator
- Enter capital gain.
- Enter your other taxable income.
- Enter province or territory.
- Your results appear instantly below and update as you change the numbers.
How this calculator works
Canada taxes capital gains at your marginal rate on only half the gain: for 2026 the inclusion rate is 50% for all taxpayers (the proposed increase to two-thirds for gains over $250,000 was cancelled). The taxable gain is added to your income, so the tax depends on which bracket it falls into — the calculator shows the increase in combined federal + provincial tax. Your principal residence is exempt, as is most of the gain from selling a small business (the lifetime capital gains exemption, $1,275,000 for 2026). Worked example: a $50,000 gain for an Ontario taxpayer earning $90,000 adds $25,000 of taxable income, which is taxed at roughly 30% — about $7,550 of tax, or 15% of the actual gain.
Frequently asked questions
What is the capital gains inclusion rate for 2026?
50% for everyone. The previous government proposed raising it to 66.7% for gains over $250,000, but that change was cancelled, so individuals, corporations and trusts all include half their gains at the 2026 rate.
Do I pay capital gains tax on my primary residence?
No. The principal residence exemption means the gain on your home is completely tax-free. Rental properties, vacation homes, and investment properties do not qualify, and a home flip or development project may be taxed as business income instead.
How is the gain on a rental property taxed?
Half the gain is added to your income in the year of sale, and you also have to 'recapture' any capital cost allowance previously claimed — that recapture is taxed as ordinary income. Many sellers see a combined effective rate of 25–27% on the total property gain.
Can I reduce capital gains tax?
Yes — hold investments inside a TFSA (never taxed), use RRSP contributions to push income into a lower bracket, offset gains with capital losses from the current or past three years, and use the lifetime capital gains exemption for qualified small business shares.
Disclaimer: Results are estimates for general information only and do not constitute financial, tax, or legal advice. Figures reflect the current tax year and may change. Always confirm current limits and consult a qualified professional before making decisions. Official figures: canada.ca tax rates · CPP rates · CMHC mortgage insurance.