RRSP Calculator — Tax Savings & Contribution Room 2026
Tax saved by an RRSP contribution at your province's marginal rate, your 2026 contribution room (18% of earned income to $33,810), over-contribution check, growth to retirement, tax on withdrawal and whether an RRSP or TFSA wins.
| Marginal rate at your income | — |
|---|---|
| Tax before / after the contribution | — |
| Net cost of contributing | — |
| Your 2026 contribution room | — |
| Over-contribution check | — |
| Growth to retirement | — |
| Tax on withdrawal at retirement | — |
| RRSP vs TFSA for this money | — |
| Deadline | — |
In short
An RRSP contribution is deducted from taxable income, saving tax at your marginal rate — about 30% at $90,000 in Ontario, so $10,000 contributed returns roughly $2,970 — and the 2026 limit is 18% of 2025 earned income up to $33,810 plus unused room; contributions by 2 March 2027 count for 2026, and the Home Buyers' Plan allows a $60,000 tax-free withdrawal for a first home.
Who this is for: Canadians deciding how much to contribute before the March deadline, comparing RRSP with TFSA, or checking room and over-contribution limits.
RRSP contributions: the refund, the room and the retirement tax
A Registered Retirement Savings Plan contribution is deducted from taxable income, so it saves tax at your marginal rate now and grows tax-deferred; withdrawals are taxed as income later. The 2026 limit is 18% of 2025 earned income up to $33,810, less any pension adjustment, plus all unused room from earlier years — the exact figure is on your notice of assessment.
- Where it works best: when your marginal rate today (say 43% at $150,000 in Ontario) is higher than it will be in retirement (say 24% at $50,000), you keep the difference. If your rate will be the same or higher, a TFSA is usually better.
- Timing: contributions in the first 60 days of 2027 can be deducted for 2026; you can also contribute now and claim the deduction in a future higher-income year.
- Over-contributions: a $2,000 lifetime cushion is allowed; beyond that the excess is taxed at 1% a month.
- Special withdrawals: up to $60,000 tax-free for a first home under the Home Buyers' Plan (repaid over 15 years starting the fifth year) and $20,000 for education under the Lifelong Learning Plan.
- Spousal RRSPs let a higher earner contribute to a lower-earning spouse's plan to split retirement income.
See also: OAS Clawback Calculator 2026.
Assumptions
- Tax saving = tax at income − tax at (income − contribution) using the 2026 federal + provincial engine; marginal rate = tax on the next $100.
- Room = min(18% × earned income, $33,810) − pension adjustment + carried-forward room; over-contribution tolerance $2,000.
- Future value = contribution × (1 + r)ⁿ; withdrawal taxed at the marginal rate on the retirement income entered; TFSA comparison invests the after-refund amount at the same return.
Worked example
Marginal rate 31.48% (the Ontario surtax starts just above $95,000) → tax falls from $19,947 to $16,980: $2,967 saved, so the contribution costs $7,033 net. New room = 18% × $90,000 = $16,200. The $10,000 grows to $42,919; withdrawn at a 19.05% marginal rate on $50,000 of retirement income it nets $34,743 — versus $30,186 in a TFSA from the same $7,033 after-tax: the RRSP wins by about $4,560 because the rate in retirement is lower.
Frequently asked questions
How much tax will I get back from an RRSP contribution?
Your marginal rate × the contribution: about 30% at $90,000 in Ontario, 43% at $150,000, 20% at $50,000. A $10,000 contribution at $95,000 of income returns roughly $2,970.
What is the RRSP limit for 2026?
18% of your 2025 earned income up to $33,810, less any pension adjustment, plus unused room carried forward; the limit for 2027 contributions will be $34,990 based on 2026 income.
Should I choose an RRSP or a TFSA?
RRSP if your tax rate today is higher than it will be when you withdraw; TFSA if it is the same or lower, or if you may need the money before retirement. Many people use both — RRSP for the refund, TFSA with the refund.
What is the RRSP deadline for the 2026 tax year?
2 March 2027 — contributions in the first 60 days of 2027 can be deducted on either the 2026 or a later return.
What happens if I over-contribute?
Up to $2,000 over your limit is tolerated (but not deductible); anything above that is taxed at 1% per month until withdrawn, and you must file a T1-OVP return.
Can I use my RRSP to buy a house?
Yes — the Home Buyers' Plan lets a first-time buyer withdraw up to $60,000 ($120,000 for a couple) tax-free, repaid over 15 years; the FHSA ($8,000 a year, $40,000 lifetime) can be combined with it.
Does an RRSP contribution reduce CPP or EI?
No — CPP and EI are calculated on gross employment income regardless of RRSP contributions; only income tax is reduced.
Can I carry forward the deduction?
Yes — contribute now (using your room) and claim the deduction in any later year when your income and marginal rate are higher.
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