Calculator / RRSP
RRSP tax savings calculator for 2025 and 2026
Compare estimated income tax before and after a proposed RRSP deduction.
RRSP tax savings
Your tax with and without the deduction
Use a deduction within your available RRSP room. Quebec is not supported. This simplified comparison excludes CPP/EI credits and most personal credits.
Estimated tax savings
$1,482.50Modelled deduction: $5,000.00. Approximately $296.50 saved per $1,000 deducted.
- Tax saved 9%
- Tax still owed 91%
- Tax before deduction
- $17,145.95
- Tax after deduction
- $15,663.45
- Effective savings rate
- 29.6%
Before you rely on it
What to know
The assumptions and limits behind this estimate.
01
Savings depend on your brackets
An RRSP deduction lowers taxable income, so the saving depends on which tax brackets it comes out of. A $1,000 deduction saves less than $1,000.
02
Your room is personal
This tool does not know your available contribution room. Confirm it on your latest notice of assessment or CRA account.
The method
How it's calculated
The steps the calculator follows, in order.
01
Estimate tax without the deduction
The same simplified federal and provincial model as the tax refund calculator: brackets, basic personal amounts, the Canada employment amount and selected provincial adjustments.
02
Estimate tax with it
Subtract the deduction from income, up to your employment income, and run the same model again.
03
Take the difference
The drop in tax is the estimated saving. It is also shown per $1,000 deducted and as a percentage of the deduction.
Example
A worked example
The calculator's starting values, worked through so you can check the result above.
Take an Ontario employee in 2025 earning $85,000 who plans a $5,000 RRSP deduction.
Before the deduction, modelled tax is $17,145.95: $11,430.50 federal, $4,965.45 Ontario and a $750 Ontario Health Premium. With it, taxable income falls to $80,000 and modelled tax to $15,663.45.
The saving is $1,482.50, or $296.50 per $1,000. All $5,000 comes off income taxed at 20.5% federally and 9.15% in Ontario, so it saves 29.65%. The health premium stays at $750, its maximum at both incomes.
At $60,000 of income, the same deduction saves $1,340, or 26.8%. The last $2,375 of it reaches income below $57,375, where the federal rate is 14.5%, so those dollars save less.
Withdrawals are taxed as income later, so a deduction usually defers tax rather than removing it.
Questions
Common questions
Short answers to what people often ask about this estimate.
Only if the tax deducted from your pay stays the same. Then the saving shows up as a larger refund or a smaller balance owing when you file.
A larger deduction can pull income down into a lower bracket, where each dollar saves less. Provincial adjustments, such as the Ontario Health Premium, can also change. The calculator works this out by estimating tax both ways.
On your latest notice of assessment or in CRA My Account. Contributions above your limit by more than $2,000 are taxed at 1% a month until they are withdrawn.
Yes. Contributions made in the first 60 days of a year can be deducted on the previous year's return.
No. You can carry unclaimed contributions forward and deduct them in a later year, which may save more if you expect a higher income then.
No. A donation to a registered charity gives you a tax credit instead of a deduction: 14.5% federally on the first $200 you give in 2025 and 29% above that, plus your province's credit. The donation credit calculator works it out for your province.
The withdrawal is added to your income for that year, and the financial institution withholds tax. Home Buyers' Plan and Lifelong Learning Plan withdrawals follow their own rules.
Methodology
Methods and sources for every calculator
Every calculator documents its method, its assumptions and the official sources behind its rules.