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TFSA or RRSP: which one wins for you?

Both accounts grow tax-free. The difference is when you pay the tax: before the money goes in (TFSA) or when it comes out (RRSP). Put in your numbers and see which ends with more after tax.

Beta2026 tax rates, every provinceYour numbers stay on your deviceAn estimate, not tax advice

Your numbers

The result updates as you type.

$

Before tax. This sets the tax an RRSP deduction saves you today.

$

In today's dollars: CPP, OAS, pensions and other withdrawals. Not sure? Many people plan on 50 to 70% of today's income.

$

The same money from your pay, after tax, goes into one account or the other.

The RRSP refund

Be honest here. It changes the answer more than anything else.

Yearly return

The same return in both accounts, so it changes the size of the gap, not who wins.

With these numbers
about $0

TFSA ends with
$0
All yours. Withdrawals are never taxed
RRSP ends with
$0
RRSP refund today
$0
After tax, in today's money
TFSARRSP after taxRefund, invested

What if your income later is different?

The refund is assumed to be invested tax-free (for example in a TFSA) at the same return. Tax later uses today's brackets and the rate on money taken out a slice at a time, on top of your other income. Real returns move up and down and are never guaranteed.

The one rule behind the answer

Put the same after-tax money in each account and invest the refund. The RRSP comes out ahead when your tax rate today is higher than your rate when the money comes out. If the rates are the same, the two accounts end up equal, to the dollar. Everything else is detail.

That is why the answer is personal. A nurse in her peak earning years and a student in his first job can get opposite answers from the same calculator, and both be right.

Things that can tip it

  • Employer match. If your workplace adds money when you put money in a group RRSP or pension, take the match first. It beats both accounts.
  • Buying a first home? The FHSA gives you an RRSP-style deduction and TFSA-style tax-free withdrawals. For a first home it usually comes before both. Plan your down payment.
  • Low income in retirement. RRSP withdrawals count as income and can shrink the Guaranteed Income Supplement. TFSA withdrawals don't.
  • Flexibility. TFSA money can come out any time and the room comes back on January 1 of the next year. RRSP withdrawals are taxed, and the room is gone.
  • Spending the refund. If the refund turns into a trip, the RRSP loses most of its edge. Decide where it goes before it arrives.
Your move · 10 minutes

Find your two numbers

  1. Look up your income on last year's notice of assessment and put it in the first box.
  2. For income later, add up what you expect: a workplace pension, CPP (your estimate is in My Service Canada Account) and OAS.
  3. Check both rooms in CRA My Account before moving money: TFSA room and RRSP deduction limit.
Go deeperTool: RRSP refund estimatorTool: TFSA roomLesson: the RRSPQuiz: which account first?All tools
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Sources and method

Where this comes from

  • Tax rates: the same 2026 federal and provincial brackets as the RRSP refund estimator (CRA and Revenu Québec, checked October 2026). Future tax rates are unknown, so today's brackets stand in for them.
  • Government of Canada: OAS recovery tax. Threshold $95,323 for the 2026 income year; 15% of income above it.
  • Government of Canada: GIS amounts. A single person qualifies with income below $23,112, not counting OAS (figures as of October 2026, adjusted every quarter). The 50-cent cut used above is a rough minimum; the real reduction depends on your situation.
  • Leaves out: CPP and EI credits, the age and pension credits, provincial benefits, pension splitting, and RRIF minimum withdrawals. These can move your real rates by a few points.
  • The calculation is Planted North's own. It compares accounts, not investments, and says nothing about what to buy.