From $8K to $83K: Real‑World Examples of the New Capital‑Gains Tax Increase

Here’s a clear look at how the proposed rise in the capital‑gains inclusion rate—from 50 percent to 66⅔ percent (effective January 1, 2026) for gains over $250,000—translates into real dollars lost. In each example, we assume a 50 percent combined federal+provincial marginal rate on the taxable portion of the gain.

Example 1: Investment Portfolio Gain of $100,000

Old rules (50 % inclusion):

Taxable gain = $100,000 × 50 % = $50,000

Tax owed = $50,000 × 50 % = $25,000

New rules (66⅔ % inclusion):

Taxable gain = $100,000 × 66.67 % ≈ $66,667

Tax owed = $66,667 × 50 % ≈ $33,333

Extra tax paid: $33,333 – $25,000 = $8,333

Example 2: Small‑Business Share Sale, $300,000 Gain

(first $250,000 retains 50 % inclusion; only the $50,000 above that shifts to 66⅔ %)

Old rules:

Taxable on first $300K = $300K × 50 % = $150,000

Tax owed = $150,000 × 50 % = $75,000

New rules:

Taxable on first $250K = $250K × 50 % = $125,000

Taxable on excess $50K = $50K × 66.67 % ≈ $33,333

Total taxable = $125,000 + $33,333 = $158,333

Tax owed = $158,333 × 50 % ≈ $79,167

Extra tax paid: $79,167 – $75,000 = $4,167

Example 3: Crypto Windfall, $1 Million Gain

Old rules:

Taxable gain = $1,000,000 × 50 % = $500,000

Tax owed = $500,000 × 50 % = $250,000

New rules:

Taxable gain = $1,000,000 × 66.67 % ≈ $666,667

Tax owed = $666,667 × 50 % ≈ $333,333

Extra tax paid: $333,333 – $250,000 = $83,333

Why It Matters

Even modest gains (Example 1) see $8K more in tax.

Entrepreneurs (Example 2) giving up an extra $4K on a $300K sale—dollars that could seed a new venture.

High‑net‑worth events (Example 3) cost over $80K more in tax on a $1 million gain.

If you’re planning any capital‑gain transaction over the next couple of years, build in these higher costs now—whether by accelerating sales under the current rules, revisiting your corporate structure, or leveraging exemptions and rollovers wherever possible. Understanding the impact in concrete dollars is the first step to preserving more of your hard‑earned gains.