RRSP and TFSA calculator 2026 (Canada)

How the RRSP tax refund works

RRSP contributions are deducted from your taxable income, so you get back the tax you would have paid on that money at your marginal rate. Your employer usually takes tax from your pay as if you hadn’t contributed, so the saving comes as a refund when you file. CPP and EI aren’t reduced.

Example: $80,000 income, $6,000 into an RRSP

• Ontario: a refund of $1,779 (29.65%: 20.5% federal plus 9.15% Ontario), so the contribution really costs $4,221.
• British Columbia: a refund of $1,692.
• Quebec: a refund of $2,167.05, part of it from Revenu Québec.
• Put the refund in a TFSA: with $3,000 of your own, $4,779 a year goes into the TFSA as well.
• At 65: starting with $20,000 in an RRSP and $10,000 in a TFSA at 35, at 5.5% growth with 1% fees, both could be worth about $534,000 in today’s money.

2026 limits

• RRSP: 18% of last year’s earned income, up to $33,810, less any pension adjustment, plus unused room from earlier years. Your notice of assessment shows your exact room.
• RRSP deadline: contributions made by 1 March 2027 count towards your 2026 return.
• TFSA: $7,000 for 2026. If you’ve been 18 or over and living in Canada since 2009 and never contributed, your total room is $109,000.
• Over-contributing: costs 1% a month on the excess. RRSPs allow a $2,000 cushion; TFSAs don’t.
• FHSA: first-time buyers can also put in $8,000 a year, up to $40,000, with a deduction like an RRSP and tax-free withdrawals for a home.

RRSP or TFSA?

• RRSP first if your tax rate now is higher than you expect it to be in retirement, typically on incomes over about $58,000.
• TFSA first on a lower income, for money you may need before retirement, or if you expect the Guaranteed Income Supplement: TFSA withdrawals don’t count as income, so they don’t reduce GIS or OAS.
• Both: putting each RRSP refund into a TFSA is a simple way to use both.

Your RRSP must become a RRIF or annuity by the end of the year you turn 71. Withdrawals are then taxed as income, and CPP and OAS come on top. To see your full tax bill, use the Canada income tax calculator. This calculator uses 2026 federal and provincial tax with the basic credits only. Growth is not guaranteed.