Ads keep this website free for you.
TaxTips.ca does not research or endorse any product or service appearing in ads on this site.  Before making a major financial decision you  should consult a qualified professional.

2020 Corporate Income Tax Rates TaxTips.ca
Canadian Tax and
Financial Information

If you use an ad blocker, please consider a small contribution to help keep TaxTips.ca free for everyone.

Need an accounting, tax or financial advisor? Look in our Directory.  Use above search box to easily find your topic!   Stay Connected with TaxTips.ca!
Home
What's New
Calculators
Personal Tax
Business
Sales Taxes
Free in 30!
Financial Planning
RRSP RRIF TFSA
Real Estate
Stocks Bonds etc.
Seniors
Disabilities
Canada
Alberta
British Columbia
Manitoba
Ontario
Quebec
Saskatchewan
Atlantic Provinces
Territories
Federal Budget
Provincial Budgets
Statistics etc.
Glossary
Site Map
Directory
Advertise With Us
Contact Us/About Us
Links & Resources
Business   ->  Corporate Income Tax Rates -> 2020 Corporate Income Tax Rates

2020 Corporate Income Tax Rates

The following table shows the general and small business corporate income tax rates federally and for each province and territory for 2020.  The small business rates are the applicable rates after deducting the small business deduction (SBD), which is available to Canadian-controlled private corporations (CCPCs).  The small business rate is available on active business income up to the amount of the Business Limit.  The federal business limit of $500,000 begins to be reduced when a CCPC's taxable capital reaches $10 million, and is eliminated when taxable capital reaches $15 million.  This phase-out of the small business deduction is also in effect in some provinces.  The federal 2018 budget implemented changes to reduce the business limit based on the investment income of a CCPC, for taxation years beginning after 2018.

The federal general rate is net of the 10% federal tax abatement and 13% (2012 and later years) general rate reduction.  The general rate reduction is disallowed for a personal services business (PSB), for taxation years beginning after October 31, 2011, resulting in a federal corporate tax rate of 28% for PSBs, until the end of 2015.  The Federal 2016 Budget increased the corporate tax rate for PSBs from 28% to 33% effective January 1, 2016.

2020 Corporate Income Tax Rates
  Active Business Income Investment
Income
CCPC
  General Small Business
(CCPC)
Business
Limit
Federal   15% 9% $500,000 38.7%
Alberta  (5) 10%/8% 2% $500,000 10%
BC 12% 2% $500,000 12%
Manitoba 12% 0% $500,000 12%
New Brunswick 14% 2.5% $500,000 14%
Newfoundland & Labrador (1) 15% 3% $500,000 15%
Nova Scotia (2) 16%/14% 3%/2.5% $500,000 16%
Northwest Territories (1) 11.5% 4% $500,000 11.5%
Nunavut (1) 12% 3% $500,000 12%
Ontario (6) 11.5% 3.2% $500,000 11.5%
Prince Edward Island (1)(4) 16% 3% $500,000 16%
Quebec (3) 11.5% 5% $500,000 11.5%
Saskatchewan 12% 2% $600,000 12%
Yukon (7) 12% 2% $500,000 12%

The general corporate tax rate applies to active business income in excess of the business limit.

See also Corporate Taxation of Investment Income

(1)  NL, NT, NU and PE use the federal small business limit.

(2) Nova Scotia provides a corporate tax holiday under s. 42 of their Income Tax Act for the first 3 taxation years of a new small business after incorporation.  See New Small Business Tax Deduction on the Nova Scotia website.

Nova Scotia's 2020 Budget announced reductions in the general and small business corporate tax rates, effective April 1, 2020.

(3) According to Quebec's Corporate Income Tax Changes page, the general tax rate is reduced each year by 0.1% until 2020.  Thus, it will be 11.7% in 2018, 11.6% in 2019 and 11.5% in 2020.  The Quebec March 27, 2018 Budget announced an increase in the small business deduction rate for small and medium sized businesses (SMBs) in sectors other than the primary and manufacturing sectors.  This will reduce the small business tax rate to 7% effective for the period from March 28 to December 31, 2018, to 6% for 2019 and to 5% for 2020, and to 4% for 2021.  See Standardizing Tax Rates for SMBs on the Revenu Quebec website.

(4) The PEI 2019 Budget reduced the small business tax rate to 3.0% from 3.5% for taxation years that begin on or after January 1, 2020.  Their 2020 Budget reduces the rate to 2% effective January 1, 2021.

(5) Alberta's Bill 3 June 2019 reduced the general corporate tax rate to 11% effective July 1, 2019, with subsequent reductions to 10% on January 1, 2020, 9% on January 1, 2021, and 8% on January 1, 2022.  However, on June 29, 2020, Alberta announced that the rate would drop to 8% effective July 1, 2020.

(6) The Ontario November 6, 2019 Economic Update announced that the small business Corporate Income Tax rate would be reduced to 3.2% from 3.5% starting January 1, 2020.

(7) Yukon's 2020 Budget announced that the small business corporate income tax rate would be reduced to zero effective January 1, 2021.

Resources:

    - Canada Revenue Agency (CRA) Federal, Provincial and Territorial corporate income tax rates.

    - Alberta corporate and commodity tax rates

    - BC corporate income tax

    - Manitoba corporate income taxes

    - New Brunswick corporate income tax

    - Newfoundland & Labrador corporate income tax

    - Northwest Territories corporate income tax

    - Nova Scotia corporate income tax & credits

    - Nunavut Dept of Finance Taxation

    - Ontario corporate income tax

    - Saskatchewan corporate income tax

    - Yukon income tax rates

    - Provincial Budgets

Revised: July 29, 2020

 

Copyright © 2002 Boat Harbour Investments Ltd. All Rights Reserved.  See Reproduction of information from TaxTips.ca

Facebook  | Twitter  |  Monthly Newsletter Sign-up  What’s New E-mail Notification RSS News Feed
The information on this site is not intended to be a substitute for professional advice.  Each person's situation differs, and a professional advisor can assist you in using the information on this web site to your best advantage. 
Please see our legal disclaimer regarding the use of information on our site, and our Privacy Policy regarding information that may be collected from visitors to our site.