Lifetime Capital Gains Exemption Calculator
Calculate the $1,250,000 LCGE on QSBC shares or qualified farm or fishing property. Handles CNIL grind and prior-year usage.
Your LCGE calculator
$103,824 saved with LCGE
Without the exemption, tax on this gain would have been $103,824.
| LCGE limit (2026) | $1,275,000 |
| Effective exemption (after CNIL + prior usage) | $1,275,000 |
| Realized gain | $500,000 |
| Exempt portion | $500,000 |
| Taxable portion | $0 |
| Taxable capital gain (50% inclusion) | $0 |
| Tax owed | $0 |
Remaining LCGE for future use: $775,000
How the LCGE works
The LCGE under ITA s.110.6 is a lifetime, cumulative cap on the capital gains a Canadian resident can claim as exempt on dispositions of qualifying property. The 2025 limit is $1,250,000, raised from $1,016,836 by the 2024 Federal Budget. Unlike the inclusion-rate proposal that was scrapped in 2025, the LCGE increase was retained.
CNIL — the silent grinder
Cumulative Net Investment Loss is a balance that runs since 1988, tracking the excess of cumulative investment expenses over cumulative investment income. Interest on investment loans, net rental losses, and certain other investment-related expenses build up the CNIL; interest income, dividends, and net rental income deplete it. A positive balance directly reduces the LCGE available in any given disposition year. Many taxpayers are surprised by their CNIL balance only at the moment they need to claim the LCGE — checking CRA My Account well before a planned sale is the safest approach.
QSBC share qualification tests
Three tests must be met at the moment of the share disposition:
- • CCPC status: the corporation must be a Canadian-Controlled Private Corporation
- • Active business asset test: 90% or more of the corporation's assets must be used in active business carried on primarily in Canada
- • 24-month look-back test: the same active-business condition (here 50%, not 90%) must have held continuously for the 24 months preceding the sale
Holding companies, investment companies, and corporations with significant cash or passive investment balances frequently fail one of these tests at sale. Pre-sale "purification" (extracting passive assets via dividends before the sale) is a common planning move.
Related decisions
If you are realizing a QSBC gain near the LCGE limit, the Tax-Loss Selling Calculator can help you offset the taxable portion above the exemption with realized losses from public-market securities. See the 2026 Capital Gains overview for the current inclusion rate that drives the taxable portion.