Dividend Income Calculator
How much income your portfolio throws off today, how it compounds with dividend growth and reinvestment (DRIP), and what you actually keep after tax — using the Canadian eligible-dividend gross-up and dividend tax credit.
Dividend income by year
Annual dividend income — reinvesting (DRIP) vs taking the cash.
Portfolio value by year
How the holdings grow — price appreciation, plus reinvested dividends when DRIP is on.
Year-by-year projection
Dividend income, yield on cost, after-tax income, and portfolio value each year.
| Year | Dividend income | Yield on cost | After-tax | Portfolio value |
|---|
How this is calculated
Dividend income and growth
Year-0 income is simply portfolio value × yield. Each year, the dividend per dollar invested grows relative to the share price: it scales by (1 + dividend growth) ÷ (1 + price growth). If dividends grow faster than the price, the yield on your holdings drifts up over time. Income each year is value × current yield.
DRIP (dividend reinvestment)
With reinvestment on, the portfolio grows by both price appreciation and the dividends bought back as shares: value → value × (1 + price growth) + dividends. Those new shares pay their own dividends, so income compounds. With DRIP off, only price growth applies and the cash is paid out to you.
Yield on cost
Yield on cost = this year's dividend income ÷ original investment. Unlike the stated yield (based on today's price), yield on cost climbs as a company raises its dividend — the payoff of holding growing dividend payers for the long run.
Eligible-dividend gross-up and tax credit (2026)
Canadian eligible dividends are grossed up by 38% to a taxable amount, then reduced by a dividend tax credit: a federal credit of 15.0198% of the grossed-up amount plus a provincial credit (10% in Ontario, 12% in BC, and so on). The effective rate shown is (tax(other income + $1,000 of dividends) − tax(other income)) ÷ $1,000, computed on your combined federal + provincial brackets after the basic personal amount, Ontario surtax and health premium, and the Quebec abatement where they apply. It's an estimate — it ignores CPP/EI, OAS clawback, the alternative minimum tax, and other credits.
Why low-income retirees can pay ~0% (or negative)
Because the 38% gross-up is offset by the combined dividend tax credit and your basic personal amount, a retiree with little other income can receive substantial eligible dividends and pay close to nothing. At very low incomes the effective rate can even go negative — the dividend tax credit spills over and shelters a bit of other income too. That is real, and this tool shows it rather than flooring at zero.
What this doesn't model
Dividend cuts, non-eligible (small-business) dividends, foreign-dividend withholding tax, currency effects, fund fees, sequence-of-returns risk, and reinvestment inside registered accounts (TFSA/RRSP dividends are tax-free or tax-deferred, so the tax panel applies to non-registered holdings). Remember a dividend is not free money — the price drops by roughly the payout on the ex-dividend date, so judge holdings by total return, not yield alone. For the full income-tax picture see the income tax calculator, and for realized gains the capital gains calculator.