Tax-Loss Harvesting Calculator Canada

You sell an investment that is worth less than you paid for it, in a regular investing account. That locks in a capital loss, which cancels profits you made selling other investments, so less of your income is taxed. The same day, you buy a similar investment so your money stays in the market. You end up holding roughly the same thing and paying less tax this year.

No. Nothing that happens inside a TFSA, RRSP or FHSA is reported on your tax return: profits there are not taxed, and losses there cannot be claimed. Harvesting only works in a regular, non-registered account, sometimes called a cash or margin account. If your only investments are in registered accounts, you have nothing to harvest, and nothing to pay tax on either.

Half. If you buy shares for $10,000 and sell them for $15,000, your capital gain is $5,000, and $2,500 of it is added to your income. You pay your normal tax rate on that $2,500. At a 30% rate that is about $750. A capital loss works the same way in reverse: half of it cancels taxable gains, which is why the tool shows each dollar of loss saving half of your tax rate.

No. A capital loss can only cancel capital gains, not employment income, interest or most other income. That is why the tool asks for the profits you have already taken. If you have no gains this year, the loss is not wasted: it carries back to gains from the last three years or forward to any future year.

The part you cannot use becomes a net capital loss. You can send it back to cancel capital gains you reported in any of the three previous years by filing Form T1A with your return, and the CRA refunds the tax you paid on them. You do not need to amend the old returns. Anything still left over carries forward to every future year with no expiry, and the CRA keeps track of the balance on your notice of assessment.

It is the CRA rule that stops you from selling at a loss and buying the same thing straight back. The loss is denied if you, your spouse or common-law partner, a corporation you control, or your own RRSP or TFSA buys the same or an identical investment in the 30 days before or the 30 days after your sale, and still holds it 30 days after. A denied loss in a regular account is added to the cost of the new purchase, so it comes back later. A loss denied because your RRSP or TFSA bought the investment is gone for good.

Something similar that is not the same investment. For index funds, the usual answer is a fund from another company that follows a different index. For example, XIC follows the S&P/TSX Capped Composite Index and VCN follows the FTSE Canada All Cap Domestic Index: both hold most of the Canadian stock market, so switching from one to the other keeps your money working without breaking the 30-day rule. Two funds that track the same index are riskier, because the CRA can treat them as identical.

Wednesday, December 30, 2026. A sale counts in the year it settles, and Canadian stock and ETF trades settle one business day after you place them. The TSX is closed on December 25 and 28, so a trade on December 30 settles on December 31. A trade placed on December 31 settles in January and counts for 2027.

Mostly it is tax you pay later instead of now. The replacement you buy costs less than your original did, so if it climbs back and you sell it, you report a bigger gain then. It still pays off in three ways: you keep and invest the saving today, you can pay less overall if you sell the replacement in a lower-income year such as retirement, and a loss carried back turns into a real refund from a year that is already closed. For a saving of a few dollars, the trading fees and your time may not be worth it.

Your broker sends a T5008 slip or an annual gains and losses summary showing the sale. You report the sale on Schedule 3 of your tax return, and most tax software fills it in from the slip. To carry a loss back to an earlier year, also file Form T1A with this year's return. Keep your own record of what you paid, because the book value on the slip is not always right after transfers or reinvested dividends.

It gives a close planning estimate. It uses 2026 federal and provincial tax brackets with the basic personal amount, and values any carried-back or carried-forward loss at today's rate, since it cannot know your rate in other years. It leaves out fees, foreign exchange on US-dollar holdings, losses you already carry from earlier years, and credits for dependants, tuition or medical expenses. Check your book value on your broker statement before you sell.