How much of a tax refund will your RRSP contribution get you?
Every dollar you contribute to your RRSP reduces your taxable income, and the government sends you a refund for the difference. Move the sliders and see your exact refund — no sign-up required.
100%
of RRSP contributions reduce your taxable income
Mar 3
is the 2025 RRSP contribution deadline
$32,490
maximum 2025 RRSP contribution room
Free
this calculator
An RRSP contribution is not just savings — it's a government subsidy. At a 33% tax rate, every $1,000 you contribute effectively only costs you $670 out of pocket. The government pays the rest.
Your Tax Profile
Your Income
Provincial tax rates vary significantly.
Your RRSP
Find on your CRA MyAccount or last year's NOA.
Refund Reinvestment
Tax Bracket Display
Your marginal rate: 28.2% (federal 20.5% + provincial 7.7%)
Your average effective rate: 23.1%
Want to maximize your RRSP deduction?
We can help you find the optimal contribution amount.
Book a Free ReviewYour Estimated Tax Refund
From your $10,000 RRSP contribution
Your effective cost: $7,180 (after refund)
Gross Contribution
$10,000
Tax Refund
$2,820
Your Net Cost
$7,180
What you actually pay out of pocket
Govt Subsidy %
28.2%
% of your contribution paid by tax savings
Before vs After Tax
| Without RRSP | With RRSP | |
|---|---|---|
| Taxable Income | $85,000 | $75,000 |
| Federal Tax | $14,352 | $12,302 |
| Provincial Tax | $5,279 | $4,509 |
| Total Tax | $19,632 | $16,812 |
| Tax Savings | $2,820 | |
| Take-Home Pay Diff. (Monthly) | +$235 |
What your $2,820 refund can do if invested:
REINVEST IN RRSP
Adds $2,820 to your RRSP. At 7% over 20 years, grows to $10,913. Plus next year's refund on the reinvestment: $2,876 more.
PAY DOWN MORTGAGE
At 5% mortgage rate, saves $2,820 in interest over remaining amortization.
TFSA
Tax-free growth. At 7% over 20 years, your refund grows to $10,913 completely tax-free.
What if you reinvested your refund into your RRSP every year for 10 years?
| Year | Contribution | Refund Received | Refund Reinvested | Total RRSP Added |
|---|---|---|---|---|
| 1 | $10,000 | $2,820 | $2,820 | $10,000 |
| 2 | $0 | $795 | $795 | $12,820 |
| 3 | $0 | $224 | $224 | $13,615 |
| 4 | $0 | $63 | $63 | $13,839 |
| 5 | $0 | $18 | $18 | $13,903 |
By reinvesting your refund annually, you contribute an extra $1,108 over 10 years — funded entirely by the government.
CONTRIBUTE NOW (January)
Gains 2 months of tax-sheltered growth. Worth $117 more at retirement.
CONTRIBUTE AT DEADLINE (Feb/March)
Still gets the refund — but loses 2 months of compound growth.
Provincial Tax Comparison
| Province | Marginal Rate | Estimated Refund |
|---|---|---|
| QC | 39.5% | $3,950 |
| SK | 32.5% | $3,250 |
| MB | 32.5% | $3,250 |
| NB | 32.5% | $3,250 |
| NS | 32.5% | $3,250 |
| PEI | 32.5% | $3,250 |
| NL | 32.5% | $3,250 |
| YT | 32.5% | $3,250 |
| NT | 32.5% | $3,250 |
| NU | 32.5% | $3,250 |
| AB | 30.5% | $3,050 |
| ON | 29.6% | $2,965 |
| BC | 28.2% | $2,820 |
Moving from BC to QC changes your refund by $1,130 on the same contribution.
Your RRSP Contribution Limit
Your RRSP limit is 18% of your previous year's earned income, to a maximum of $31,560 (2024), minus any pension adjustment.
- 2024 maximum: $31,560
- Your estimated limit based on income: $15,300
- Remaining room: $15,000
Note: Unused room carries forward indefinitely. Overcontributing by more than $2,000 triggers a 1%/month penalty.
A $10,000 RRSP contribution at your 28.2% marginal rate generates approximately $2,820 in tax refund — meaning your actual out-of-pocket cost is only $7,180. If you reinvest that refund back into your RRSP next year, your effective contribution rate keeps compounding. Over 20 years at 7%, your $10,000 contribution (net $7,180 cost) grows to $38,697.
Your RRSP Refund is Free Money — Don't Waste It
Most Canadians spend their tax refund. The ones who reinvest it build dramatically more wealth over time. Book a free call with Sarah and we'll maximize your RRSP contribution, calculate your exact refund, and show you the smartest way to use it.
BOOK YOUR FREE RRSP STRATEGY CALLQuestions? Call Sarah Lovett at 250-727-8268
