Capital Gains Tax Canada 2025 — Calculator by Province

Capital gains tax in Canada is based on a portion of your gain being added to your income and taxed at your marginal rate. As of 2025, the inclusion rate is 50% for individuals. This means only half your capital gain is added to taxable income. Use our provincial calculator below for an accurate estimate.

Capital Gains Tax Calculator

Capital Gain Amount ($) Your Other Annual Income ($) Province

Capital Gains Tax Rates by Province 2025

Province	Top Marginal Rate	Max Cap Gains Rate (50% inclusion)
Ontario	53.53%	26.77%
British Columbia	53.50%	26.75%
Alberta	48.00%	24.00%
Quebec	53.31%	26.65%
Saskatchewan	47.50%	23.75%
Manitoba	50.40%	25.20%
Nova Scotia	54.00%	27.00%
New Brunswick	52.50%	26.25%
Newfoundland	54.80%	27.40%
PEI	51.37%	25.69%

How Capital Gains Are Taxed in Canada

Canada does not have a separate flat capital gains tax rate. Instead, a percentage (the inclusion rate) of your capital gain is added to your regular income and taxed at your marginal rate. The formula:

Capital Gain = Sale Price − Adjusted Cost Base (ACB) − Selling Costs
Taxable Gain = Capital Gain × 50% (inclusion rate)
Tax = Taxable Gain × Your Marginal Tax Rate

What Assets Generate Capital Gains?

Stocks, ETFs, mutual funds (in non-registered accounts)
Real estate (non-principal residence)
Cryptocurrency and digital assets
Business assets (goodwill, equipment at above book value)
Options and derivatives
Collectibles and personal-use property above $1,000

  2024 Inclusion Rate Proposal: The 2024 federal budget proposed increasing the capital gains inclusion rate from 50% to 66.67% for individuals on gains above $250,000/year. This was not legislated before Parliament prorogued in January 2025. As of 2025, the 50% inclusion rate still applies while the status of this proposal remains uncertain.

Capital Losses and Carry-Overs

Capital losses can only offset capital gains — they cannot be applied against employment income, interest income, or rental income. Unused capital losses can be:

Carried back 3 years to offset prior capital gains
Carried forward indefinitely

This makes tax-loss harvesting a valuable strategy. By realizing capital losses in your portfolio, you can offset gains and reduce your tax bill for the current year or recover taxes paid in prior years.

Lifetime Capital Gains Exemption (LCGE)

The LCGE provides a major shelter for entrepreneurs. For 2025, the exemption is $1,250,000 on qualifying property including:

Qualified Small Business Corporation (QSBC) shares
Qualified farm property
Qualified fishing property

Careful planning (holding period, asset tests, business activity tests) is required to ensure shares qualify for the LCGE before a business sale.

Capital Gains vs. Business Income

Not every gain on asset sales is treated as a capital gain. The CRA may reclassify gains as business income (100% taxable) if:

You engage in frequent, systematic trading (especially in a TFSA)
You flip real estate within 365 days (anti-flipping rules)
Your primary intention at purchase was to resell for profit

Shelter Capital Gains in Your TFSA

Capital gains inside a TFSA are completely tax-free. Use KOHO's savings tools to maximize your TFSA contributions and grow investments without the tax bill.

Open KOHO — Use Code 45ET55JSYA