Capital Gains Tax Calculator
What you'll actually owe when you sell stocks, funds or property in Canada, the 2026 50% inclusion rate applied to your province's brackets, stacked on top of your other income. Selling your home? It's exempt, and we'll say so.
Rates & rules verified · July 2026Primary sources: CRA – Tax rates and income brackets · Revenu Québec – Income tax rates
Tax on this gain across Canada
Same gain, same other income, what each province and territory would charge.
How much of the gain you keep
Tax owed versus what stays in your pocket, out of the full capital gain.
How the taxable gain fills your brackets
Your taxable capital gain stacks on top of your other income. This is where each dollar of it lands.
| Income band | Rate | Gain in band | Tax |
|---|
How this is calculated
The 50% inclusion rate
In Canada only half of a capital gain is taxable. The taxable amount is gain × 50%, added to your income and taxed at your marginal rate. The proposed increase to a two-thirds (66.67%) inclusion rate was cancelled in March 2025, so the 50% rate continues for all individuals in 2026 (confirmed July 2026).
The capital gain
gain = proceeds − selling costs − ACB − capital improvements. Proceeds is the sale price; ACB (adjusted cost base) is what you originally paid plus purchase costs; selling costs are commissions and legal fees; capital improvements (renovations that add lasting value, not repairs) increase your ACB on property. Ordinary repairs and maintenance do not count.
The tax on the gain
We compute tax = T(other income + taxable gain) − T(other income), where T is your combined federal + provincial income tax including the basic personal amount credits, Ontario surtax and health premium, and the Quebec abatement where they apply. This captures the fact that a large gain can push you into higher brackets. The effective rate shown is that tax divided by the full gain (not the taxable half), so it never exceeds about half your top marginal rate.
Principal residence exemption
The sale of your principal residence is fully exempt for every year it was designated as such, the tax is $0. You still report the sale (Schedule 3 and Form T2091), but you owe nothing. Only one property per family unit can be the principal residence in a given year.
The property flipping rule
If you sold a residential property (or an assignment) you owned for less than 365 days, the profit is deemed business income, fully taxable (100%, not 50%) and the principal residence exemption is denied, unless a life-event exception applies (death, disability, birth, marriage breakdown, work relocation, insolvency, etc.). This rule applies to dispositions since January 1, 2023.
Superficial loss rule
If you realize a loss and buy back the same or identical property within 30 days before or after (by you or an affiliated person), the loss is denied and instead added to the ACB of the repurchased property.
Carrying losses
Net capital losses can be carried back 3 years or forward indefinitely, but only against capital gains, never against ordinary income (except a limited rule at death).
What this doesn't model
The lifetime capital gains exemption on qualified small-business shares or farm/fishing property, recapture of depreciation (CCA) on rental buildings, the change-in-use rules, foreign-property reporting, or the alternative minimum tax. Estimate your full-year tax with the income tax calculator, or model a rental sale end-to-end with the property investment calculator.
Common questions
What is the capital gains inclusion rate in Canada for 2026?
The inclusion rate is 50%. Only half of a capital gain is added to your taxable income and taxed at your marginal rate. The proposed increase to a two-thirds (66.67%) inclusion rate was cancelled by the federal government in March 2025, so the long-standing 50% rate continues for all individuals in 2026.
Do I pay capital gains tax when I sell my home in Canada?
No. The sale of your principal residence is fully exempt from capital gains tax under the Principal Residence Exemption for every year the home was designated as your principal residence. You must still report the sale on your tax return (Schedule 3 and Form T2091), but no tax is owed. If you sold a home you owned for less than 365 days, the property flipping rule can treat the profit as fully taxable business income instead.
How is capital gains tax calculated on stocks or a rental property?
First find the capital gain: sale proceeds minus selling costs (commissions, legal fees) minus your adjusted cost base (ACB) minus capital improvements. Then 50% of that gain is added to your other income for the year. The extra tax is the difference between your total tax with the gain and your total tax without it, using your province's combined federal and provincial brackets.
What is the superficial loss rule?
If you sell an investment at a loss and you (or an affiliated person, including your spouse or a corporation you control) buy the same or identical property within 30 days before or after the sale, the loss is denied as a superficial loss. Instead, the denied amount is added to the ACB of the repurchased property, deferring the benefit until you eventually sell it for good.
Can I carry capital losses back or forward?
Yes. Net capital losses can be carried back up to 3 years to recover tax paid on gains in those years, or carried forward indefinitely. Capital losses can only offset capital gains, not regular income (with a limited exception at death).