GIC Calculator Canada

A GIC promises a number. This calculator shows the dollars behind the promise: what a guaranteed investment certificate actually pays at maturity, with annual or monthly compounding or simple interest paid out each year, so you can compare offers from different banks on equal terms.

Amount to invest ($)GIC interest rate (%)Term (years)How interest is paid / compounded

GIC interest is taxed as ordinary income in a non-registered account, at your full marginal rate, in the year it is earned or paid. Inside a TFSA or RRSP it is sheltered or deferred. Most GICs are CDIC-insured up to $100,000 per insured category per institution.

How it works

Compounding is the quiet difference between two GICs advertising the same rate. A 3-year GIC at 4.5% compounded annually turns $10,000 into $11,411.66, while the same rate paid out yearly without compounding returns $11,350. Monthly compounding lands slightly higher again. The gap grows with the term and the rate.

Also check the early-redemption terms before you buy. A non-redeemable GIC usually pays more but locks the money away, and the interest penalty for breaking a cashable GIC varies by issuer.

Worked example

The calculator’s own output for $10,000 at 4.50% over 3 years with annual compounding:

Item	Amount
Amount / rate / term	$10,000.00 at 4.50% for 3 years
Compounded annually: interest earned	$1,411.66
Value at maturity (annual compounding)	$11,411.66
Paid out yearly (no compounding): total interest	$1,350.00

Frequently asked questions

Are GICs insured in Canada?

Yes. Deposits at CDIC member institutions are insured up to $100,000 per insured category (including principal and interest) if the institution fails. Credit union deposits are covered by provincial insurers, often at higher limits.

How is GIC interest taxed?

As interest income at your marginal rate, with no dividend tax credit or capital gains treatment. In a non-registered account you are taxed on interest as it accrues each year, even on a multi-year GIC paid at maturity, and you will receive a T5.

What is a GIC ladder?

Splitting money across 1, 2, 3, 4 and 5-year GICs so one matures every year. You gradually capture the higher long-term rates while keeping regular access to part of the money, and each maturity can be reinvested at current rates.

Cashable vs non-redeemable GIC: which pays more?

Non-redeemable GICs pay higher rates because the issuer keeps your money for certain. Cashable GICs trade a lower rate for the right to exit, often after a short closed period.

Can I hold a GIC in a TFSA?

Yes, and the interest is then completely tax-free. Whether a GIC is the best use of TFSA room depends on your goals and time horizon, since the same room can hold investments with higher expected growth.

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For education only. This calculator gives estimates, not financial, tax or legal advice. Figures use 2026 rates where a rate is built in; confirm your own numbers before making a decision.