Canada's generally applicable capital-gains inclusion rate remains one-half in 2026. A 2024 proposal to raise it to two-thirds for individual annual gains above C$250,000 and all corporate/most trust gains was deferred and then cancelled; it did not take effect. Federal Budget 2025 records the cancellation.
The proposal's arithmetic, for historical comparison
Had the cancelled individual proposal applied to Renée’s C$400,000 gain, the first C$250,000 at one-half would have included C$125,000, and the remaining C$150,000 at two-thirds would have included C$100,000. Total proposed taxable gain: C$225,000, C$25,000 more than the actual C$200,000. That is a comparison with a proposal, not tax owed under 2026 law.
A C$500,000 scenario
At a deliberately assumed flat 53.5% marginal tax rate applied to the whole taxable gain, current-law C$250,000 inclusion corresponds to C$133,750 model tax. The cancelled tiered formula would include C$125,000 + C$166,666.67 = C$291,666.67 and model tax about C$156,042, a C$22,292 difference. Actual Canadian tax is progressive and depends on province, other income, losses, deductions and minimum tax. The chart demonstrates inclusion-rate effect only, not a personalised tax quote.
Other relief is separate
Qualifying small-business shares and qualified farm/fishing property may be eligible for a lifetime capital-gains exemption under distinct conditions; do not apply it to ordinary investments or assume the 2024 proposal changed its 2026 eligibility. Capital losses may offset taxable gains under their own carry rules. A TFSA can shelter qualifying investment gains, whereas RRSP withdrawals are generally taxable later, so an RRSP does not mean gains “never become taxable.” Confirm current treatment against CRA's capital-gains reporting guidance.
