Is the interest on your savings account taxable in Canada?
Quick summary
Yes. Interest you earn in a regular savings account is investment income, and the Canada Revenue Agency says it is part of your total income. You report it on line 12100 of your return. If the interest is earned inside a TFSA, it is generally tax-free. See how the two compare in TFSA vs savings account.
Checked November 10, 2026. Main source: Canada Revenue Agency: Line 12100, Interest and other investment income (modified January 20, 2026, read November 10, 2026). See all 2 sources.
Key facts
- Where it goes
- Line 12100 of your return
- Source: CRA, modified January 20, 2026
- Slip
- A T5 is usually issued. Under $50 you may not get one, but you must still report the interest
- Source: CRA, modified January 20, 2026
- Inside a TFSA
- Interest is generally tax-free
- Source: CRA, modified September 17, 2026
What the CRA says about interest
The CRA lists interest as part of the investment income you report on line 12100. It is added to your other income for the year.
Most banks send a slip, usually a T5, early in the year. The CRA says you may not receive one if your total investment income is under $50. You are still asked to report that interest.
The CRA page does not give a tax rate for interest. How much tax you pay depends on your total income and your province, so we do not guess a number here.
Source: Canada Revenue Agency: Line 12100, Interest and other investment income (modified January 20, 2026, read November 10, 2026).
GICs and term deposits follow a yearly rule
For term deposits, GICs and similar investments, the CRA says to report the interest earned during each complete investment year, even if you get no slip.
Its example: a long-term investment made on July 1, 2024 has its interest through June 30, 2025 reported on the 2025 return. Compound GIC interest is earned monthly but paid only at cashing or maturity, and it is still reported as the CRA describes.
Source: Canada Revenue Agency: Line 12100, Interest and other investment income (modified January 20, 2026, read November 10, 2026).
What changes inside a TFSA
The CRA says contributions, interest, dividends and capital gains in a TFSA are generally tax-free, even when you withdraw. Contributions are not tax-deductible.
That is why people compare a TFSA savings account with a regular one. The right choice depends on your room and your goals.
Source: Canada Revenue Agency: TFSA, what it is (modified September 17, 2026, read November 10, 2026).
What to do next
- Look for a T5 in your online banking in the new year, and add up any interest without a slip.
- Enter the total on line 12100, or ask your tax software where it goes.
- If you want to see how interest adds up, try the interest calculator.
Questions people ask
Do I pay tax on savings account interest in Canada?
Yes. The CRA treats interest as investment income that is part of your total income, reported on line 12100. Interest inside a TFSA is generally tax-free.
What if I do not get a T5?
The CRA says you may not get a slip if your investment income is under $50, but you must still report it.
How is GIC interest reported?
The CRA says to report the interest earned during each complete investment year, even if it is paid only at maturity and you get no slip.
How much tax will I pay on interest?
The CRA page does not give a rate. It depends on your total income and province.
Does your province have its own rules?
Credit union deposits are insured by provincial bodies, and the limit depends on where you live. Pick yours to see where to look. We remember your choice on this device only.