The Canada Revenue Agency confirmed the prescribed rate will hold at 3 percent for the fourth calendar quarter of 2026, the sixth consecutive quarter at that level. For a family income-splitting loan, a prescribed-rate loan from a higher-earning spouse to a lower-earning spouse or to a family trust, or an intra-family loan for a trust set up for the children, that number is the entire strategy. The rate on the day the loan is advanced is the rate for the life of the loan, even if the prescribed rate rises every quarter afterward.
The rate has not moved because the CRA formula is mechanical: it takes the average three-month Government of Canada Treasury bill yield from the first month of the preceding quarter and rounds up to the next whole percentage point. A yield environment can climb for months before that rounding threshold actually flips the published rate. That is close to where things stand now.
What the Bond Market Is Already Pricing
The Government of Canada five-year yield closed at 3.60 percent on September 18, up from 3.33 percent a month earlier and 0.86 percentage points higher than a year ago. The move reflects the same mechanism the Economy Desk is tracking today: the Bank of Canada holding its policy rate at 2.25 percent while the U.S. Federal Reserve raised its own rate for the first time since 2023, widening the gap between the two curves and pulling Canadian yields up alongside it.
The three-month T-bill that actually feeds the prescribed-rate formula moves with the same forces. It has not yet climbed far enough for long enough to force the rate past its rounding threshold, which is why 3 percent has held since early 2025. A sustained continuation of the current yield path is a plausible route to a Q1 2027 increase, though the CRA does not announce a quarter early and no one can commit to that outcome in advance.
This is the planning bridge: a prescribed-rate loan established this quarter locks in 3 percent regardless of what happens to the rate in January. A client who has been considering an income-splitting loan and has been waiting for a better entry point already has one. Waiting for the rate to fall further is not supported by anything the yield curve is currently showing.
The RRSP Number Behind It
Separately, the RRSP dollar contribution limit for 2026 rose to $33,810, up from $32,490 in 2025, continuing a run of increases that has taken the limit up more than 35 percent over the past decade.
The chart below shows the ten-plus year climb in context. The pattern is steady rather than dramatic: the limit is calculated as 18 percent of the prior years earned income up to an annual maximum, and it has risen every year without exception since 2015.
The 2027 figure is already legislated under the existing 18 percent formula and is not subject to further confirmation.
Where the Certainty Already Exists
The Lifetime Capital Gains Exemption rose to $1.275 million for 2026, and the capital gains inclusion rate remains flat at 50 percent for all taxpayers, corporate and individual alike, following the 2025 cancellation of the proposed increase to two-thirds. For clients who held off on realizing gains through 2025 while that proposal was unresolved, that uncertainty is fully closed. The open question this quarter is not the inclusion rate. It is the prescribed rate, and it is open for a matter of weeks rather than years.