Fidelity’s tax calculator allows you to estimate your year-end tax balance based on your employment income, investment income, RRSP contributions, FHSA contributions, charitable donations and amount of taxes paid. The calculator will show your tax savings based on the specified RRSP and FHSA contribution amount.

All federal and provincial taxes and surtaxes are taken into account. However, the calculator assumes that only the basic personal tax credit, as well as the dividend tax credit and Canada employment amount, if applicable, are available. You may be entitled to other tax deductions and credits. It is assumed that the full amount of donations, subject to the 75% net income limitation, is used to calculate the donation tax credit, although that may not be the optimal tax reduction strategy in all circumstances. It is also assumed that taxable income for provincial purposes is the same as federal.

The calculator is intended to estimate your taxes only. Your personal tax situation may have additional complexities that cannot be factored in by this tax calculator. We recommend you consult your investment professional or tax advisor for a comprehensive review of your personal tax situation.

Interest: This amount is taxed at the same rate as your employment income.

Capital gains: Starting June 25, 2024, the capital gains inclusion rate will be increased from one-half to two-thirds for capital gains of over $250,000 per year for Canadians. The 2024 calculator accounts for this. For more information, see: https://www.canada.ca/en/department-finance/news/2024/06/fair-and-predictable-capital-gains-taxation.html

Canadian dividends: Canadian dividends receive preferential tax treatment compared with interest income. There are two types of dividends: eligible and other than eligible. The calculator assumes the dividend to be an eligible dividend; and it is therefore grossed up by 38% for the 2012 and later tax years. The corresponding non-refundable dividend tax credit, which can reduce your taxes owing, is also included in the calculation.

Charitable contributions: You can claim eligible amounts of gifts to a limit of 75% of your net income. For 2015 and prior years, a 15% federal credit and 6% provincial credit will be calculated on the first $200 of donations, and a 29% federal credit and 11% provincial credit on remaining donations. For donations made after the 2015 tax year, the calculation will incorporate the new tax credit rate of 33%, which applies to the eligible amount of gifts greater than $200, to the extent that an individual has income that is subject to the new 33% income tax rate.

RRSP contribution: Total up any contributions from the previous year, any contribution amounts contributed in the 60 days after the end of the taxation year, and any unused contributions from prior years. Refer to your Notice of Assessment from the Canada Revenue Agency (CRA) to find out your current RRSP contribution limit and any unused contributions in previous years.

FHSA Contributions: Contribution limits are capped at a lifetime $40,000 or $8,000 per year. Lifetime limits only begin to accumulate once a qualifying account has been opened. Investment growth can compound on a tax-free basis for up to 15 years from the time an account is opened, or the investor turns 71, whichever comes first. Refer to your Notice of Assessment from the Canada Revenue Agency (CRA) to find out your current FHSA contribution limit and any unused contributions in previous years.

Taxes paid: The amount of taxes withheld by your employer (at source) or tax instalments you have already remitted to CRA for the taxation year.

Go to the Canada Revenue Agency (CRA) website for more information.