Dividend Tax Calculator 2026

See the tax on dividends from Canadian companies after the gross-up and the dividend tax credits, and how it compares with a capital gain or interest, using 2026 rates for your province or territory.

✓ 2026 rates · verified Oct 21–27, 2026

Gross-up and credit, in plain words

A corporation pays tax on its profit before it pays you a dividend. To avoid taxing the same money twice, the tax system pretends you earned the corporation’s pre-tax profit (the gross-up), taxes that, and then gives you a credit for the tax the corporation already paid (the dividend tax credit).

1. Gross-up: eligible dividends × 138%, other-than-eligible × 115%. The grossed-up amount is added to your income.
2. Tax on that income at your federal and provincial rates.
3. Federal credit: 15.0198% of grossed-up eligible dividends and 9.0301% of other-than-eligible. Your province or territory adds its own credit (table below).
4. Tax on your dividends = the tax with them minus the tax without them, worked out with our income tax engine. The credits can’t take your total tax below zero.

Eligible or other-than-eligible?

Eligible dividends get the bigger gross-up and the bigger credit because the corporation paid tax at the general rate. Ordinary dividends from a small business corporation get a smaller credit because the company paid the lower small business rate. With a $70,000 job in Alberta, $10,000 of eligible dividends costs $1,015.71 in tax and the same amount of other-than-eligible dividends costs $2,218.34.

Why dividends can be nearly tax-free at low incomes

If dividends are your only income, the basic personal amounts and the dividend tax credits together cover the tax on a surprising amount. In Alberta, someone with no other income can receive about $80,750 of eligible dividends in 2026 with no income tax. In Ontario it’s about $14,490, because the Ontario Health Premium can’t be reduced by the dividend tax credit.

Dividend tax by province

Tax on $10,000 of eligible dividends on top of a job, 2026 rates, and the most eligible dividends you can receive tax-free with no other income:

Credit: the province’s or territory’s dividend tax credit on grossed-up eligible dividends (2026 return figures; Quebec from Revenu Québec). A negative amount means the dividends lowered your total tax.

Worked example

You live in Alberta, earn $70,000 from your job, and receive $10,000 of eligible dividends.

• Gross-up: $10,000 × 138% = $13,800.00 added to your income.
• Federal dividend tax credit: 15.0198% × $13,800.00 = $2,072.73. Alberta’s: 8.12% = $1,120.56.
• Federal tax rises by $756.27 and Alberta tax by $259.44: $1,015.71 in all, 10.2% of what you received.
• The same $10,000 as interest would cost $3,050.00, and as a capital gain $1,525.00.

What this calculator assumes

• The dividends are from taxable Canadian corporations, received outside a TFSA, RRSP or other registered plan, and you were resident in the province or territory you choose on December 31, 2026.
• Your other income is either employment income (CPP, EI and the Canada employment amount) or other income such as a pension, with the basic personal amounts. With an age of 65 or more, the federal and provincial age amounts are included (and Saskatchewan’s senior supplement; outside Quebec), and the grossed-up dividends can reduce them; the pension income amount isn’t.
• The capital gain row uses the 50% inclusion rate; the interest row is fully taxable.
• No alternative minimum tax is calculated. AMT ignores the gross-up and the dividend tax credit, so it matters mainly for very large dividends.

Rates for tax year 2026, verified October 21 to October 27, 2026 · Page updated October 28, 2026