Few tax stories generated more anxiety than the 2024 proposal to raise Canada's capital gains inclusion rate. Two years on, the most important fact is the one that got the least attention: for the typical investor, almost nothing actually changed.
What was proposed
Budget 2024 proposed raising the inclusion rate from one-half to two-thirds on capital gains above $250,000 per year for individuals (and on all gains for most corporations and trusts). A higher inclusion rate means more of each gain is taxable.
What actually happened
The change was repeatedly deferred and ultimately did not take effect. The inclusion rate remains 50% in 2026. The saga is a textbook example of why you shouldn't restructure a long-term portfolio around a proposal that hasn't become law.
The bottom line
The part that was always true
Here's what the entire debate overlooked: inside registered accounts, the inclusion rate doesn't apply at all. Gains in a TFSA, RRSP, or FHSA are sheltered regardless of what the rate is. Capital gains tax is only ever a non-registered account problem.
Planning that holds up either way
- Max your registered accounts first — they're immune to inclusion-rate changes entirely.
- In non-registered accounts, hold tax-efficient broad-market ETFs and avoid unnecessary selling.
- Use capital losses to offset gains in the same or carry-back/forward years.
- Estimate any taxable gain before you sell with our capital gains calculator.
The lesson isn't "ignore tax policy." It's that the best defence against shifting rules is the same as always: shelter as much as you can inside registered accounts, and keep your taxable investing simple and low-turnover.
