What is the TFSA limit for 2026?

$7,000, unchanged for a third consecutive year. Someone eligible since 2009 who has never contributed has $109,000 of cumulative room. Unused room carries forward indefinitely, and withdrawn amounts are restored as room the following calendar year.

What return should I assume?

There's no correct answer, which is why we show a range. Historical long run equity returns have been higher than 6%, but past returns don't predict future ones, and portfolios usually become more conservative as a target date approaches. We default to 6% before fees and show 4% and 8% alongside. Whatever you assume, subtract your fees and adjust for inflation.

How much do investment fees cost over 30 years?

A great deal. On $500 a month over 30 years at a 6% gross return, a 0.2% MER produces about $483,500 while a 2% MER produces about $347,000 a difference of roughly $136,500, or over 27% of the ending balance, on identical contributions.

Do I pay tax on investments in a TFSA?

Generally no all growth and withdrawals are tax free. Two exceptions: dividends from US listed US companies face a 15% withholding tax that isn't recoverable in a TFSA, and the CRA can reclassify frequent trading as business income and tax it fully.

TFSA or RRSP which should I use first?

It depends on your marginal rate now versus in retirement. An RRSP deduction is worth more if your current rate is higher than your expected retirement rate, which favours higher earners. A TFSA is generally better at lower incomes, where the deduction is worth little and flexibility is worth more. If you're a first time home buyer, the FHSA usually beats both.

How are dividends taxed in Canada?

Canadian dividends are grossed up and then reduced by a dividend tax credit. Eligible dividends from public corporations are grossed up 38% with a 15.0198% federal credit; non eligible dividends are grossed up 15% with a 9.0301% credit. Provincial credits apply on top. At lower incomes the combined credit can exceed the tax, producing a zero or negative effective rate.

How is interest income taxed?

Fully 100% of interest is included in taxable income at your marginal rate. It's the least favourably treated form of investment income, which is why GICs and bonds are usually better held inside registered accounts.

Where should I hold US stocks?

In an RRSP, if they pay dividends. US listed US dividends are exempt from the 15% US withholding tax in an RRSP under the Canada US treaty. In a TFSA the withholding applies and isn't recoverable; in a non registered account you can usually claim a foreign tax credit.

What's the difference between nominal and real returns?

Nominal is the raw number; real is what it buys after inflation. $500 a month for 30 years at 6% produces about $502,300 nominally roughly $277,300 in today's purchasing power at 2% inflation. Both are correct; they answer different questions.

Can a 0% average return lose money?

Yes. A year of +50% followed by a year of −50% averages 0%, but $100 becomes $150 and then $75 a 25% loss. Compound growth follows the geometric mean, which is always lower than the arithmetic mean when returns vary, and the gap widens with volatility.

How much do I need to invest to have $1 million?

It depends on your return and horizon. At 6%, roughly $1,000 a month for 30 years gets you there nominally. But $1 million in 30 years has the purchasing power of about $552,000 today so if you meant a million in today's money, your nominal target is closer to $1.81 million.

Does my province affect my investment returns?

Not in a registered account nothing is taxed. In a non registered account it does, because investment income is taxed at provincial as well as federal rates. The effective top rate on capital gains ranges from about 22.25% in Nunavut to 27.40% in Newfoundland and Labrador.

Is this calculator free?

Yes. No account, no email, no limits and we don't sell investments or take commission from anyone who does.

Investment Calculator Canada

Q: What is the capital gains inclusion rate in Canada in 2026?

50%, for individuals, corporations and trusts. Half of any gain is added to your taxable income and taxed at your marginal rate. The proposed increase to 66.67% on gains above $250,000 was announced in Budget 2024, deferred in January 2025, and cancelled on 21 March 2025 it never became law. There is no $250,000 threshold.

See what your investments could actually be worth after fees, after inflation, and after tax.

Enter your contributions and time horizon, pick your account type and province, and we'll show you a range rather than a single number. Because a projection running thirty years out is an estimate, and anyone presenting it as a forecast is selling you something.

Investment Calculator

Canadian Account Type

Starting investment ($)

Contribution ($)

Frequency

Est. Return (%)

Time (Years)

Compounding Frequency

Estimated Future Portfolio Value (2046)

$302,370

Total invested: $130,000 · Compound growth: +$172,370

Total Invested

$130,000

Principal + contributions

Compound Earnings

+$172,370

at 7% average return

Future Value

$302,370

in 20 years (2046)

Compound Growth ProgressionYear

TFSA Growth Note: All interest, dividends, and capital gains earned in a TFSA are 100% tax-free in Canada.

What This Calculator Assumes

We put this first, because it's the part that determines whether the number above means anything.

A thirty year projection is not a forecast. Nobody knows what markets will do over that period, and small changes in assumption produce enormous changes in outcome.

Here is the same person contributing the same $500 a month for thirty years:

Annual return	Ending value
4%	$347,000
6% (Base)	$502,300
8%	$745,200

Identical contributions of $180,000 in every case. A $398,000 spread, produced entirely by an assumption.

That's why we default to 6% rather than something more flattering, show the range alongside it, and let you change it. And why we show the inflation adjusted figure next to the nominal one, every time.

The specific assumptions:

Contributions are monthly, at the end of each month, and constant. Real contributions usually rise with income
Returns compound monthly at a constant rate, with no year to year variation. Real returns are volatile see below, this matters more than it sounds
Fees are deducted from the return; set your MER in the fee field
Inflation defaults to 2%, the Bank of Canada's target
Tax treatment follows the account type you select
No withdrawals during the period

How Compound Growth Works

Compounding is growth earning growth. Each period's return is calculated on a balance that already includes previous returns, so the curve steepens over time.

The consequence people underestimate is how much of the final number arrives late. In the default scenario, $180,000 of contributions becomes $502,300 meaning roughly $322,300, about 64% of the total, is growth. And most of that growth accrues in the final third of the period, because that's when the balance is largest.

Which is why time in the market matters more than the amount. Someone contributing $500 a month for thirty years ends with far more than someone contributing $1,000 a month for fifteen despite identical total contributions.

What Your Money Will Actually Be Worth

Here's the thing almost no investment calculator shows you.

That $502,300 is not $502,300 in the money you spend today. At 2% annual inflation over thirty years, it has the purchasing power of roughly $277,300 in today's dollars.

Both figures are correct. They answer different questions. The nominal figure is what the account statement will say. The real figure is what it will buy.

Why this matters for planning

If you've decided you need "a million dollars to retire," you almost certainly mean a million in today's purchasing power. At 2% inflation over thirty years, that's about $1.81 million nominally. Planning to the nominal figure when you meant the real one leaves you roughly 45% short.

Why Average Returns Mislead

This is the most important piece of arithmetic on this page, and it's counterintuitive enough that most people get it wrong.

A "0% average return" can lose you 25% of your money.

Arithmetic vs Geometric mean

Compound growth follows the geometric mean, not the arithmetic one. The geometric mean is always lower when returns vary, and the gap widens with volatility.

A portfolio advertising an 8% average return will compound at less than 8% if those returns are bumpy. A steadier 6% can beat a volatile 8% over a long period.

What this calculator does about it

It uses a constant rate, which is standard and which draws a smooth curve. Real returns never look like that. A realistic thirty year path includes several losing years, at least one severe drawdown, and long stretches of nothing much.

What Fees Cost

Fees look small annually and are enormous over a lifetime, because you pay them on the compounded balance.

Same $500 a month over thirty years, assuming a 6% gross return:

Annual fee (MER)	Net return	Ending value
0.2% index ETF	5.8%	$483,500
2.0% typical mutual fund	4.0%	$347,000

A $136,500 difference. That's over 27% of the ending balance, gone to fees, on identical contributions and identical gross performance. Put another way: the 2% fee consumed more than three quarters of your total contributions.

Where to Invest TFSA, RRSP, FHSA and Non Registered

Account type changes your outcome as much as your return does, because it determines what gets taxed.

TFSA

Contributions come from after tax income. All growth and all withdrawals are permanently tax free.

RRSP

Contributions are deductible, reducing your taxable income now. Growth is tax deferred, and withdrawals are fully taxable.

FHSA

For first time home buyers: contributions are deductible like an RRSP, and qualifying withdrawals are tax free like a TFSA.

Non registered

No limits, no restrictions, and fully taxable annually but how it's taxed depends on the type of income.

2026 Contribution Limits

Account	2026 limit
TFSA	$7,000 unchanged for a third year
TFSA cumulative room	$109,000 (since 2009)
RRSP	$33,810 or 18% of prior year income
FHSA	$8,000/year, $40,000 lifetime
RESP	$50,000 lifetime per beneficiary

How Investment Income Is Taxed

In registered accounts TFSA, RRSP, FHSA, RESP none of this applies. Growth is tax free or tax deferred.

Income type	Treatment	Relative tax cost
Interest	100% included in income	Highest
Non eligible dividends	15% gross up, smaller credit	High
Eligible dividends	38% gross up, larger credit	Lower can be zero at low incomes
Capital gains	50% included	Lowest at higher incomes

Capital Gains in 2026 What Actually Changed

The capital gains inclusion rate in Canada is 50% in 2026. Half of any gain is added to your taxable income and taxed at your marginal rate. There is no separate capital gains tax and no holding period discount.

The proposed increase to 66.67% on gains above $250,000 was cancelled on 21 March 2025. It was never enacted into law. So for 2026: a flat 50% inclusion rate, for everyone. No $250,000 threshold. No two tier system.

Why Use the CalcVault Investment Calculator

Range projectionsShows low, base and high return scenarios side by side.

Today's dollars toggleIncludes inflation adjusted purchasing power calculations.

Fee & MER modelingAccurately shows lifetime cost of mutual fund and ETF MERs.

Verified 2026 tax rulesIncludes confirmed 50% capital gains inclusion rate for 2026.

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Investment Calculator FAQs

Sources and Disclaimer

Method: Contributions are modelled as end of month payments compounding monthly at the rate you set, net of fees. Real dollar figures divide the nominal result by cumulative inflation at your chosen rate.

Sources: Canada Revenue Agency (contribution limits, capital gains rules, TFSA/RRSP), Department of Finance Canada (cancellation of proposed inclusion rate increase on 21 March 2025), Revenu Québec.

Limitations: Projections are illustrative, not predictions. Actual returns vary year to year and can be negative.

Disclaimer: CalcVault is not an investment dealer or financial advisor. This calculator and content are general information only and do not constitute investment or tax advice.