Enter proceeds of disposition, adjusted cost base and expenses directly related to the sale in Canadian dollars. The capital result is proceeds minus ACB minus selling expenses. Then enter other taxable income and choose the province or territory.
Adjusted cost base and selling expenses
ACB often starts with purchase cost and may include acquisition fees and later adjustments. Selling expenses are costs incurred to make the disposition, such as commissions or legal fees. Identical properties, foreign currencies and special assets may require additional CRA rules.
How additional tax is estimated
Only the portion of a positive capital gain displayed by the calculator is added to taxable income. The estimate calculates progressive federal and provincial base tax once without and once with that amount. The difference is the additional tax shown, including when the gain crosses multiple tax brackets.
Example
Proceeds of CAD 50,000, an ACB of CAD 30,000 and CAD 1,000 of selling expenses produce a CAD 19,000 capital gain. The displayed taxable portion is added to other income, so the additional tax depends on both income and the selected province.
Losses and special cases
A negative result is displayed as a capital loss but is not automatically applied against earlier, current or future gains. The principal residence exemption, Lifetime Capital Gains Exemption, TFSA, RRSP, alternative minimum tax and asset-specific rules are excluded.
ACB generally starts with purchase cost. Eligible acquisition expenses and later adjustments are added. Identical properties such as shares may require an average-cost calculation.
What portion of a capital gain is taxable?
The calculator displays the tax year and inclusion rate loaded from the central Canadian rules above the inputs. Only that portion is added to taxable income.
How do capital losses affect the estimate?
A negative capital result is shown as a loss and creates no additional current-year tax in this estimate. The calculator does not determine when the loss can offset taxable capital gains.
Does this calculation apply to a principal residence?
No. A potential principal residence exemption is not calculated. Do not treat a principal-residence gain as fully taxable without checking the eligibility rules.
Are TFSA or RRSP investments included?
No. The calculator is intended for non-exempt capital gains outside registered accounts. TFSA and RRSP rules are not modelled.
Which tax year do the rules apply to?
The tax year is displayed in the calculator. The tax brackets and inclusion rate come from the dated central Canadian rules.
Why not multiply the gain by one marginal tax rate?
The taxable portion may cross several tax brackets. The calculator therefore compares estimated tax before and after adding that amount.
