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RRSP vs TFSA calculator

On this page
  1. RRSP and TFSA limits for 2026
  2. How the two accounts are taxed
  3. What this comparison assumes
  4. A rule of thumb
  5. Frequently asked questions
  6. Related

An RRSP and a TFSA both shelter investment growth. They tax you at different times. An RRSP contribution can be deducted, and withdrawals are taxed. A TFSA contribution is not deducted, and withdrawals are tax-free.

This page compares one contribution. Enter the cash you have, your marginal rate now, the rate you expect when you take the money out, how many years it will grow, and a return. You can reinvest the RRSP refund or leave it out.

The fields start on a worked example. Change any of them and the result updates as you type.

Everything runs in your browser. Nothing you type is sent anywhere, and there’s no signup.

%

The rate you'd save by deducting an RRSP contribution this year. Use your combined federal and provincial marginal rate.

%

The rate you'd pay on an RRSP or RRIF withdrawal. A guess is fine. This is a marginal rate, not your average rate.

$

After-tax cash you have today. If you reinvest the refund, the RRSP deposit is grossed up so your net cost stays at this amount. This doesn't check your RRSP or TFSA room.

yr

Whole years the money stays invested. Growth compounds once a year.

%

A constant yearly return, before fees. The same rate is used for both accounts.

When this is on, the RRSP contribution is larger by the tax refund, and your net cost matches the TFSA. When it's off, both accounts get the same deposit and the refund is left out.

Runs entirely in your browser. Nothing you enter is sent anywhere or saved.

After-tax difference $0 This calculator gives an estimate for general information. It isn't tax or financial advice.

RRSP after tax $0 What's left after tax on the withdrawal.
TFSA after tax $0 Withdrawal is tax-free.
RRSP tax refund $0 Included in the RRSP contribution, so your net cost matches the amount you entered.

This page gives general information. It isn’t tax or financial advice.

RRSP and TFSA limits for 2026

The RRSP dollar limit for 2026 is $33,810 (Canada.ca: RRSP dollar limits). New room is 18% of the previous year's earned income, up to that limit, then reduced by a pension adjustment (Canada.ca: RRSP deduction limit). The TFSA dollar limit for 2026 is $7,000 (Canada.ca: TFSA contribution room).

Source: Canada Revenue Agency. Updated October 2, 2026.

Those are the new-room caps for the year. Your own room can be higher. Unused RRSP deduction room carries forward, and so does unused TFSA room. This calculator does not check either one. A contribution still has to fit.

Use the RRSP contribution limit calculator for the 18% calculation, the dollar cap, and a pension adjustment. Use the TFSA contribution room calculator for room built up since 2009.

How the two accounts are taxed

RRSP. You deduct contributions on your tax return, up to your deduction limit. Growth inside the plan isn’t taxed while it stays there. When you take money out, it’s included in your income.

An ordinary withdrawal does not give that contribution room back. Two plans work differently. Under the Home Buyers’ Plan and the Lifelong Learning Plan, a qualifying withdrawal isn’t taxed at the time, and you repay it on that plan’s schedule. Miss a repayment and the missed amount is included in your income. CRA: HBP and LLP withdrawals

TFSA. Contributions are not deductible. Growth isn’t taxed, and a withdrawal is tax-free. The amount you take out is added back to your contribution room on January 1 of the next calendar year, not in the year you withdraw it (CRA: withdrawing from a TFSA). If you put the money back in the same year, it only fits if you still have other unused room.

What this comparison assumes

It compares the same after-tax cash.

One lump sum. One constant return, compounded once a year. One tax rate on the whole RRSP withdrawal. No fees and no inflation.

Example. You have $10,000.00 of after-tax cash (assuming you have the room). Your marginal rate is 40% now and you expect 30% in retirement. The money earns 5% a year for 20 years.

The RRSP lead comes from the gap between the two rates. With the refund reinvested, the RRSP finishes at the TFSA amount x (1 - rate later) / (1 - rate now), here 0.70 / 0.60. Years and return change the dollar amounts, not that ratio. At 40% in both years the accounts tie. A higher rate later than now flips it to the TFSA.

A rule of thumb

If your marginal rate is higher now than you expect later, the RRSP usually leaves you with more after tax, as long as the refund is reinvested. If the two rates are about the same, the accounts are roughly a tie on that same basis. If you expect a higher rate later, the TFSA usually wins.

Old Age Security and the Guaranteed Income Supplement can change that. RRSP and RRIF withdrawals count as income and can reduce those benefits. This page doesn’t put a number on that clawback.

Frequently asked questions

Is an RRSP or a TFSA better?

It depends on your marginal tax rate now and the rate you expect when you take the money out. A higher rate now than later favours the RRSP, if you reinvest the refund. A higher rate later favours the TFSA. This page runs that comparison on one contribution. It isn't a plan for your whole retirement.

What if my tax rate stays the same?

Equal marginal rates are roughly a tie when the RRSP refund is reinvested. The deduction and the tax on the withdrawal cancel out, and both accounts end at the same after-tax amount in this model. If you spend the refund instead, the TFSA ends higher, because the RRSP withdrawal is still taxed (though you'd also have the refund in hand).

Should I reinvest the RRSP tax refund?

The usual comparison assumes you do. Reinvesting puts the refund to work inside the RRSP, so you're comparing the same out-of-pocket cost. If you spend the refund, turn that option off. The calculator then puts the same dollar amount in each account and leaves the refund out of the ending balance.

Do withdrawals give me the contribution room back?

From a TFSA, yes, but not until January 1 of the next calendar year. From an RRSP, an ordinary withdrawal is taxed and that room is gone. The Home Buyers' Plan and the Lifelong Learning Plan are different: qualifying withdrawals aren't taxed when you take them, and you repay them on the plan's schedule. A missed repayment is included in your income. CRA: HBP and LLP withdrawals.

Does this include OAS or GIS clawback?

No. Old Age Security and the Guaranteed Income Supplement can shrink when your income is higher, and RRSP or RRIF withdrawals count as income. That can make an RRSP withdrawal cost more than the marginal rate alone. This calculator doesn't estimate that, and it doesn't use a clawback threshold.

Are the 2026 limits built into the result?

No. The 2026 RRSP dollar limit is $33,810 (Canada.ca: RRSP dollar limits). New RRSP room is 18% of the previous year's earned income, up to that limit, minus any pension adjustment. The 2026 TFSA limit is $7,000 (Canada.ca: TFSA contribution room). Unused room from earlier years can make your own room higher. This comparison doesn't cap the amount you enter. Check your room before you contribute.