Free calculator
See how much tax your RRSP contribution saves, what it really costs you, and how your marginal rate changes, for any province and for 2026, 2025 or 2024.
An RRSP contribution is deducted from your income before tax is calculated. The tax you would have paid on that slice of income comes back as a bigger refund, or a smaller balance owing.
Because the deduction comes off the top of your income, it saves tax at your marginal rate. That’s why the same contribution saves far more for someone earning $150,000 than for someone earning $50,000.
You pay tax when you withdraw. The strategy works best when you contribute in high-income years and withdraw in lower-income years, usually retirement.
| Tax year | Maximum |
|---|---|
| 2026 | $33,810 |
| 2025 | $32,490 |
| 2024 | $31,560 |
Your room is 18% of the previous year’s earned income, up to the limit, plus unused room carried forward.
Questions
It depends on your marginal tax rate. A contribution reduces your taxable income, so each dollar saves tax at the rate on the top slice of your income. At higher incomes that can be 40% to over 50%.
The 2026 RRSP dollar limit is $33,810. Your actual room is 18% of the previous year’s earned income up to that limit, plus any unused room carried forward. It is shown on your notice of assessment.
Contributions made in the first 60 days of the year can be deducted on the previous year’s return, or in any later year.
You can contribute now and deduct later. If you expect a higher income next year, carrying the deduction forward can save more tax.
You can go over your room by $2,000 without penalty. Beyond that, the excess is taxed at 1% per month until it is withdrawn or new room absorbs it.
More calculators
Federal and provincial tax, refund and marginal rates
Small business deduction and combined rates
CPP, EI and income tax per pay period
Compare T4 salary and T5 dividends
Estimate your federal and provincial credit
Five questions, one-minute answer
Months left and when to start raising
Book a call and we'll run it properly, against your books, not a form.