GIC return calculator
See exactly what your deposit grows to at maturity, and how the compounding frequency changes your interest.
Terms of one year or less usually pay simple interest at maturity; multi-year GICs may pay annually or compound. Eligible GICs are protected by CDIC (banks) or provincial deposit insurance (credit unions) up to the applicable limits.
GIC ladder calculator
A ladder splits your money across 1- to 5-year terms so a portion matures every year — combining better long-term rates with regular access.
Rate for each rung (%)
Each rung holds an equal one-fifth of your total. When the 1-year matures, you reinvest it at the 5-year rate, keeping the ladder rolling — so you always have money maturing within 12 months while capturing longer-term rates.
GIC after-tax return calculator
GIC interest is fully taxable outside a registered account. See what you actually keep in a TFSA, RRSP or non-registered account.
In a TFSA, GIC interest is completely tax-free. In a non-registered account, interest is taxed at your full marginal rate every year — the least tax-efficient way to hold a GIC. In an RRSP, growth is tax-deferred; you're taxed on withdrawal (shown here as tax at your current rate for comparison).
How GICs work in Canada
A Guaranteed Investment Certificate (GIC) is one of the safest places to grow cash in Canada. You lend a bank or credit union a fixed sum for a set term — from 30 days to 5 years or more — and in return they guarantee your principal plus a fixed rate of interest. Because the return is contractually guaranteed and your deposit is insured, a GIC carries virtually no risk of loss.
Types of GICs
- Non-redeemable — the most common; your money is locked in for the full term at the highest rate.
- Cashable / redeemable — you can access your money early (often after a short hold) for a slightly lower rate.
- Market-linked — the return is tied to a stock index, with principal still protected but the upside capped and uncertain.
- Registered vs. non-registered — GICs can be held inside a TFSA, RRSP or RESP, or in a regular taxable account.
Is your GIC insured?
Eligible GICs at member banks are covered by the Canada Deposit Insurance Corporation (CDIC) up to $100,000 per category, per institution. GICs at credit unions are covered by provincial deposit insurance, which in several provinces has no dollar limit. Spreading larger amounts across institutions or categories keeps everything protected.
How GIC interest is calculated and taxed
Short terms (one year or less) typically pay simple interest at maturity. Longer terms may pay interest annually or compound it — monthly, semi-annually or annually — which slightly increases your effective yield. Use the return calculator above to see the difference.
Tax treatment matters enormously. Interest income is the least tax-favoured type of investment income in Canada — it's taxed at your full marginal rate. That's why account choice is critical:
| Account | Tax on GIC interest |
|---|---|
| TFSA | None — fully tax-free |
| RRSP | Deferred — taxed on withdrawal |
| Non-registered | Taxed yearly at your full marginal rate |
At a 30% marginal rate, a 4.25% GIC in a taxable account yields only about 3.0% after tax — versus the full 4.25% in a TFSA. The after-tax calculator above shows your numbers.
The GIC laddering strategy
Instead of locking everything into one term, a GIC ladder splits your money across 1- to 5-year terms. Every year one rung matures, giving you access to a fifth of your money — which you reinvest at the 5-year rate to keep the ladder going. You capture higher long-term rates while never being more than 12 months from cash, and you smooth out the risk of locking in at a rate peak or trough. Build yours with the ladder calculator above.
GIC vs. high-interest savings account
A high-interest savings account (HISA) keeps your money fully liquid with a variable rate that can change any time. A GIC locks the rate for the term — better when rates are falling or you won't need the money soon. Many Canadians hold both: a HISA for the emergency fund, GICs (often laddered) for savings with a known horizon.
Popular GIC questions
Yes. Your principal and the promised rate are guaranteed, and eligible GICs are protected by CDIC (up to $100,000 per category, per institution) or provincial deposit insurance. The main trade-off is that your money is usually locked in for the term.
Only outside a registered account. In a TFSA, GIC interest is completely tax-free. In a non-registered account it's taxed at your full marginal rate each year, and even accrued interest on multi-year GICs must be reported annually.
Only if it's a cashable or redeemable GIC. Non-redeemable GICs lock your money in for the full term — that's the trade-off for their higher rate. A ladder helps by keeping part of your money maturing every year.
A TFSA is almost always better for a GIC, because interest is the most heavily taxed investment income. Holding it tax-free in a TFSA can lift your after-tax return by a full percentage point or more versus a taxable account.