How much will my RRSP be worth, and what refund will I get?
Enter last year's earned income, what you plan to contribute and your marginal tax rate. The calculator works out your 2026 deduction limit, keeps the contribution within it, multiplies the deductible amount by your rate to get the refund, and grows the contributions to the year you start withdrawing.
On the defaults, $80,000 of earned income in 2025 gives $14,400 of new room, which is 18%. A $10,000 contribution fits, and at a 30% marginal rate it is worth a $3,000 refund. Contributing $10,000 at the start of every year for 25 years at an assumed 5% a year builds $501,134.54, of which $250,000 is contributions. The refunds over those years add up to $75,000.
An RRSP defers tax rather than removing it. The Canada Revenue Agency's guide T4040 says income earned in the plan is usually exempt while it stays there, but you generally pay tax when you receive payments from it. Taxed at 20% on the way out, the $501,134.54 is worth $400,907.63.
How is the RRSP deduction limit calculated for 2026?
The Canada Revenue Agency's page on how contributions affect your RRSP deduction limit, modified 29 January 2026, sets out the steps. Take the lesser of 18% of your earned income in the previous year and the annual RRSP limit, subtract your pension adjustment, and add any unused room carried forward from earlier years. Pension adjustment reversals and past service pension adjustments also change it; the calculator leaves those out.
| 2025 earned income | 18% of it | 2026 new room |
|---|---|---|
| $40,000 | $7,200 | $7,200 |
| $80,000 | $14,400 | $14,400 |
| $150,000 | $27,000 | $27,000 |
| $187,833.33 | $33,810 | $33,810 |
| $250,000 | $45,000 | $33,810 |
The CRA's table of limits gives an RRSP dollar limit of $33,810 for 2026 and $35,390 for 2027. Above $187,833.33 of earned income, 18% passes the dollar limit, so more income adds no room. A pension adjustment comes straight off: $80,000 of earned income with a $5,000 pension adjustment leaves $9,400 of new room, and a $10,000 contribution then has $600 that cannot be deducted this year.
How big will my RRSP tax refund be?
A deduction lowers your taxable income, so it saves tax at the rate on your top slice of income. That is your marginal rate, federal and provincial together. The calculator asks for it rather than holding the brackets of every province, so the figure is the one that applies to you.
| Marginal rate | Refund on $10,000 | Net cost of the contribution |
|---|---|---|
| 20% | $2,000 | $8,000 |
| 30% | $3,000 | $7,000 |
| 40% | $4,000 | $6,000 |
| 50% | $5,000 | $5,000 |
A large deduction can reach down into a lower bracket, and then a single rate overstates the refund. If your contribution is bigger than the gap between your income and the start of your top bracket, enter a rate between the two. The word refund also assumes enough tax was already withheld from your pay; if not, the deduction reduces what you owe instead.
What happens if I over-contribute to my RRSP?
The CRA charges a tax of 1% a month on contributions that exceed your deduction limit by more than $2,000. With $50,000 of earned income, new room is $9,000. A $14,000 contribution is $5,000 over; the first $2,000 of that is not taxed, and the other $3,000 costs $30 a month for as long as it stays in the plan.
The calculator never grows money it cannot deduct. It keeps the projection to your deduction limit, shows the excess in the note, and works out the monthly tax on the part above $2,000. Anything within the $2,000 is not taxed, but it is not deductible this year either.
How growth, time and contributions change the result
Holding $10,000 at the start of every year:
- Assumed growth. Over 25 years the RRSP reaches $375,530.42 at 3%, $501,134.54 at 5% and $676,764.70 at 7%. Contributions are $250,000 in each case.
- Time. At 5% it holds $132,067.87 after 10 years, $501,134.54 after 25 and $948,363.23 after 35.
- Room. If you plan more than your new room each year, carried-forward room covers the gap at first. Once it runs out, each year's contribution is limited to the new room that year adds, which the calculator holds at today's figure.
- Tax rates. A higher rate now raises the refund; a higher rate on withdrawal lowers the after-tax value.
When your marginal rate on withdrawal equals your rate today, the after-tax result matches what the after-tax cost would have grown to with no tax at all. At 30% in and out, the $501,134.54 is worth $350,794.18 after tax, exactly what $7,000 a year, the net cost after each refund, grows to at 5% over 25 years.
When do I have to stop contributing to an RRSP?
The CRA's page on RRSP options when you turn 71 says December 31 of the year you turn 71 is the last day you can contribute to your RRSPs. Someone aged 46 in 2026 turns 71 in 2051, so the 25-year default, with contributions from 2026 to 2050, stays inside that limit; at an older age, enter fewer years so the last contribution comes before then. The calculator does not ask your age, so it does not check this for you.
Withdrawals before that point are allowed, but they are taxable income in the year you take them, under the T4040 rule above. Programs that let you take money out for a home or for education and pay it back later are not modelled here.
How to work out an RRSP in Excel or Google Sheets
For the deduction limit, put earned income in A2, pension adjustment in B2 and unused room in C2: =MAX(0, C2 + MIN(0.18*A2, 33810) - B2). With $80,000, no pension adjustment and no unused room it returns 14,400. The pension adjustment comes off the total, so a large one can reduce carried-forward room as well.
For the growth of a contribution made at the start of each year, use FV with a type of 1: =FV(0.05, 25, -10000, 0, 1) returns 501,134.54. The refund is the deductible contribution times your marginal rate, and the after-tax value is the FV result times (1 minus your rate on withdrawal). Both functions work the same way in Google Sheets.
What this RRSP calculator leaves out, and common mistakes
It does not hold federal or provincial tax brackets, so the refund is only as good as the rate you enter. It ignores pension adjustment reversals, past service pension adjustments, spousal RRSPs, the home buyers' and lifelong learning withdrawal programs, and conversion to a RRIF. Earnings, the dollar limit and tax rates stay at today's figures for every year shown, and growth is one fixed rate.
- Using this year's income. The 2026 room comes from 2025 earned income.
- Forgetting the pension adjustment. Members of a workplace pension plan have less room than 18% suggests.
- Treating the refund as free money. Withdrawals are taxed, so the refund is tax deferred.
- Overshooting by more than $2,000. The excess is taxed every month it stays in.
- Comparing pre-tax RRSP values with tax-free ones. Look at the after-tax value.
Glossary
RRSP: a registered retirement savings plan, where contributions are deductible and withdrawals are taxed. Deduction limit: the most you can deduct for a year. Earned income: the CRA's measure of employment and self-employment earnings that sets your room. Pension adjustment: a figure for workplace pension saving that reduces the next year's room. Marginal tax rate: the combined rate on your last dollar of income. RRIF: a registered retirement income fund, one of the places an RRSP can go when it ends.
Frequently asked questions
What is the RRSP contribution limit for 2026?
18% of your 2025 earned income or $33,810, whichever is lower, minus your pension adjustment, plus any unused room you carried forward. The CRA's figure for 2027 is $35,390.
How much tax refund will I get from an RRSP contribution?
The deductible amount times your marginal tax rate. A $10,000 deduction at a 30% rate is worth $3,000, and at 40% it is worth $4,000.
How much will $10,000 a year in an RRSP grow to?
At an assumed 5% a year, contributed at the start of each year, $132,067.87 after 10 years and $501,134.54 after 25. The growth rate is an assumption you enter, not a forecast.
What is the RRSP over-contribution penalty?
A tax of 1% a month on the amount more than $2,000 over your deduction limit. Being $5,000 over costs $30 a month on the $3,000 above the $2,000 margin.
How does a pension adjustment affect my RRSP room?
It is subtracted from the room your earned income creates. With $80,000 of earned income, $5,000 of pension adjustment cuts new room from $14,400 to $9,400.
Why does my RRSP room stop rising at higher incomes?
Because the dollar limit caps it. In 2026, 18% of earned income reaches $33,810 at $187,833.33, and income above that adds no more room.
Are RRSP withdrawals taxed?
Yes. The CRA's guide T4040 says income in an RRSP is usually exempt while it stays in the plan, but you generally pay tax when you receive payments from it.
Until what age can I contribute to an RRSP?
December 31 of the year you turn 71 is the last day you can contribute to your own RRSPs, according to the CRA.
Does unused RRSP room carry forward?
Yes. The CRA adds unused room from earlier years to each year's new room. Enter it under the more options so the calculator includes it.
Which tax rate should I enter?
Your combined federal and provincial rate on your last dollar of income. If a large contribution takes your income down into a lower bracket, use a rate between the two brackets.
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Last reviewed 14 November 2026 by the NIFM Academy editorial team. Next review by 15 January 2027.
Canada, tax year 2026. Next review by 15 January 2027.
- Canada Revenue Agency, MP, DB, RRSP, DPSP, ALDA, TFSA limits, YMPE and the YAMPE (modified 28 October 2026), RRSP dollar limit 33,810 dollars for 2026 and 35,390 for 2027; TFSA dollar limit 7,000 for 2026 and each yearly limit from 2009. Checked 14 November 2026.
- Canada Revenue Agency, How contributions affect your RRSP deduction limit (modified 29 January 2026), the deduction limit is unused room from earlier years plus the lesser of 18 percent of the previous year's earned income and the annual limit, minus the pension adjustment; a tax of 1 percent a month applies to contributions more than 2,000 dollars over the limit. Checked 14 November 2026.
- Canada Revenue Agency, RRSP options when you turn 71 (modified 29 January 2026), December 31 of the year you turn 71 is the last day you can contribute to your RRSPs. Checked 14 November 2026.
- Canada Revenue Agency, T4040 RRSPs and Other Registered Plans for Retirement, Rev. 25, income earned in an RRSP is usually exempt while it stays in the plan; you generally pay tax when you receive payments from it. Checked 14 November 2026.
- Canada Revenue Agency, Before you contribute to a TFSA (modified 20 February 2026), room starts to accumulate when a resident turns 18; the dollar limit applies only for years of residence; example: Brayden turned 18 on December 21, 2024 and had 14,000 dollars of room in January 2025; yearly limits of 5,000 dollars for 2009 to 2012, 5,500 for 2013 and 2014, 10,000 for 2015, 5,500 for 2016 to 2018, 6,000 for 2019 to 2022, 6,500 for 2023 and 7,000 for 2024 to 2026. Checked 14 November 2026.
- Canada Revenue Agency, Calculate your TFSA contribution room (modified 20 February 2026), room is the current year's dollar limit plus unused room from earlier years plus withdrawals made in the previous year; example: Alex starts 2025 with 7,000, contributes 1,000, withdraws 4,000 and has 17,000 of room on January 1, 2026; the TFSA information in your CRA account is updated once a year in the spring, after financial institutions report at the end of February. Checked 14 November 2026.
- Canada Revenue Agency, Withdrawing from a TFSA (modified 20 February 2026), a withdrawal is added back as room on January 1 of the next calendar year; unless you have unused room, do not re-contribute in the same year; an excess is taxed at 1 percent a month for as long as it stays in the account. Checked 14 November 2026.
- Canada Revenue Agency, If you over-contribute to a TFSA (modified 6 January 2026), any excess amount is taxable at 1 percent a month for as long as it remains in the account; keep your own records and track contributions closely. Checked 14 November 2026.
- Canada Revenue Agency, What is a TFSA (modified 17 September 2026), contributions are not tax deductible; interest, dividends and capital gains earned in the account are generally tax-free, even when withdrawn. Checked 14 November 2026.