A $50,000 capital gain, added to $80,000 of other income in Ontario, adds about $7,597 in federal and provincial tax. Only half of the gain, $25,000, is taxable. The tax is 15.19% of the gain. Try your own gain and income above.
How capital gains are taxed
A capital gain is what you sell an asset for, minus what you paid and minus selling costs. In Canada, half of the gain is added to your taxable income and taxed at your regular rates. So your other income matters.
Why your other income matters
The gain sits on top. At $80,000, the taxable half is taxed at 29.65% and at higher rates as it crosses brackets. With a lower income, more of it falls at lower rates. The calculator works out your tax with and without the gain and shows the difference.
What counts as a gain
Stocks, funds, cryptocurrency, rental property and cottages can all produce gains, and so can land, art and shares in a private company. Your home is usually exempt if it was your principal residence for every year you owned it. Gains inside a TFSA or an RRSP are not taxed as capital gains, which is why those accounts matter.
Capital losses
A loss can cancel gains, and it is worth tracking even in a year with no sales because it may help later. It first offsets gains in the same year, and any extra can carry back three years or forward forever. Watch the superficial loss rule, which denies a loss if you buy the same asset back within 30 days. Our guide on the superficial loss rule covers it.
Records and cost base
Track what you paid and what you sold, with the dates. For shares held in more than one lot, the CRA uses the average cost. Records matter most for crypto and rental property, where the numbers are easy to lose over ten years of buying, renovating and selling.
Your gain is the sale price minus your adjusted cost base and selling costs. The base includes the purchase price and fees, and it shifts with things like reinvested distributions. For a property, add major renovations and legal fees. Get it right.
A second example
Take a $100,000 gain with $150,000 of other income. The tax on it is about $23,096, or 23.10% of the gain. That is below the top marginal rate because part of the taxable gain falls in lower brackets. The bigger your other income, the more of the gain is taxed at higher rates.
Timing a sale
Sell in a lower income year and the tax drops. Spreading a large gain over two years can too, where that is possible. Registered accounts such as a TFSA avoid the tax entirely. For larger sales, especially property and business shares, a tax professional can help.
Where to go next
Learn the rate on the next dollar with the marginal tax rate calculator. See your regular bill in the income tax calculator. Selling a rental or home? The land transfer tax calculator covers the buyer’s side.
Frequently asked questions
How much of a capital gain is taxable?
Half of the gain, at the time of writing.
Is the tax rate on gains 50%?
No. Half of the gain is added to income and taxed at your regular rates.
Is my home exempt?
Usually, if it was your principal residence for every year you owned it.
Can capital losses reduce the tax?
Yes. Losses cancel gains and can carry back three years or forward.
Are TFSA gains taxed?
No. Gains inside a TFSA are tax free.
What is the superficial loss rule?
It denies a loss when you buy the same asset back within 30 days.
Sources and updates
Last reviewed: . Full disclaimer. How we build calculators. Editorial policy.
Estimate only. This calculator gives general information for planning. It is not tax, legal or financial advice, and it is not affiliated with the City of Toronto, MPAC or the Canada Revenue Agency. Results depend on the numbers you enter and may differ from official amounts. Check official sources or a qualified professional before you decide.