Capital Gains Calculator on an Investment (Canada)

What this calculator does

Selling an investment for more than you paid produces a capital gain, and in Canada part of that gain is taxable. This calculator turns a sale into the raw capital gain, the portion the CRA counts as taxable, the tax at your marginal rate, and the gain you keep after tax. It is meant for investments in a non-registered account, where a sale has tax consequences.

The after-tax gain, rather than the headline profit, tells you what a sale is worth and helps you decide whether to sell now, sell later or hold.

How the capital gain is worked out

The capital gain is the sale proceeds minus the adjusted cost base. The proceeds are what you receive; the adjusted cost base is what the investment cost you, including purchase commissions and any reinvested distributions added to your cost over time. If the proceeds are lower than the cost base, the result is a capital loss and no tax arises on the sale.

The CRA inclusion rate then decides how much of the gain is taxable. At the current rate of one half, half of the gain is included in income. The calculator reads that rate from a central parameter, so the taxable portion always reflects the rate in force.

How the tax is applied

The taxable portion is added to your other income and taxed at your marginal rate, the rate on your next dollar of income. Because that rate depends on your total income and your province, you enter it yourself. The taxable portion times your marginal rate is the tax, and the gain minus the tax is the after-tax gain.

The tool also reports the effective rate on the whole gain: the tax divided by the full gain. Because only half the gain is taxed, that rate is half your marginal rate, which is why capital gains are taxed more lightly than salary or interest.

A worked example

You sell an investment for $15,000 that cost $10,000. The capital gain is $5,000, and at a 50% inclusion rate the taxable portion is $2,500. At a 30% marginal rate the tax is $750, leaving an after-tax gain of $4,250 and net proceeds of $14,250. The effective rate on the full gain is 15%, exactly half the marginal rate.

Why the after-tax figure matters

Two sales with the same headline profit can leave you with different amounts once tax is applied, depending on your marginal rate. Looking at the after-tax gain before you sell makes it easier to compare selling one holding against another.

When to use it

• Before selling a holding, to see the tax cost of realizing the gain.
• When you can sell only one of two holdings and want the better after-tax outcome.
• At year end, to weigh realizing a gain now against deferring it.
• With losses elsewhere, to gauge how much a capital loss would offset the tax.

Assumptions and limits

The calculator treats the gain as one realized capital gain taxed at a single marginal rate. It does not model how a large gain can push part of your income into a higher bracket, and it does not net off capital losses, carry-forwards or special rules for assets such as a principal residence. It assumes a non-registered account.

Use your correct adjusted cost base and your true marginal rate, then confirm the final figures with your tax software or an adviser before filing.

A second worked example: pairing a capital loss

The first example gave a $5,000 gain, $2,500 taxable and $750 of tax at 30%. If you also realize a $5,000 capital loss in the same year, it offsets the gain entirely: the net gain is zero and no tax arises. If the loss is $2,500, the net gain falls to $2,500, the taxable portion to $1,250 and the tax to $375, half the original bill. Gains and losses are netted before the inclusion rate is applied, so a deliberately realized loss cancels the tax on an equal gain. The superficial loss rule denies the loss if you or an affiliated person buy the same security within 30 days before or after the sale and still hold it 30 days after.

How the gain is reported

A realized gain goes on Schedule 3 of your T1 return, with its proceeds, its adjusted cost base and any selling costs. Your broker’s T5008 slip lists the proceeds and sometimes a cost, but that cost is not always your true ACB, so check it against your own records. The taxable half flows to line 12700 and is added to your income. Net capital losses can be carried back three years or forward indefinitely against capital gains, so tracking losses is as useful as tracking gains.

Provincial dimension and common mistakes

The inclusion rate is the same everywhere, but your marginal rate depends on your province or territory, so the same $5,000 gain costs more tax in a high-rate province. Quebec residents also report the gain on the provincial TP-1 return. Common mistakes: a cost base that leaves out reinvested distributions and so overstates the gain; assuming one flat marginal rate when a large gain can push part of your income into a higher bracket; forgetting that gains inside a TFSA, RRSP, RRIF or FHSA are not taxed this way; and triggering the superficial loss rule by buying back too soon.

This information is general in nature and is not financial or tax advice.

About This Tool: Capital Gains Calculator on Investment Canada

Capital gains calculator on investment Canada: use this tool to get an instant, accurate estimate. The figures follow official CRA guidance and every rate and threshold is kept up to date for 2026. Adjust the inputs above to match your situation, or browse all our calculators to plan your next step.