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.

2021 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
Prov/Terr Budgets
Statistics etc.
Glossary
Site Map
Directory
Advertise With Us
Contact Us/About Us
Links & Resources
Business   ->  Corporate Income Tax Rates -> 2021 Corporate Income Tax Rates

2021 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 2021.  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 Federal 2016 Budget increased the corporate tax rate for personal services businesses (PSBs) from 28% to 33% effective January 1, 2016.

2021 Corporate Income Tax Rates
  Active Business Income Investment
Income
CCPC
  General Small Business
(CCPC)
Business
Limit
Federal   15% 9% $500,000 38.7%
Alberta 8% 2% $500,000 8%
BC 12% 2% $500,000 12%
Manitoba 12% zero% $500,000 12%
New Brunswick 14% 2.5% $500,000 14%
Newfoundland & Labrador (1) 15% 3% $500,000 15%
Nova Scotia (2) 14% 2.5% $500,000 14%
Northwest Territories (1)(6) 11.5% 2% $500,000 11.5%
Nunavut (1) 12% 3% $500,000 12%
Ontario 11.5% 3.2% $500,000 11.5%
Prince Edward Island (1)(4) 16% 2% $500,000 16%
Quebec (3) 11.5% 4% / 3.2% $500,000 11.5%
Saskatchewan (7) 12% zero% $600,000 12%
Yukon (5) 12% zero% $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.

(3) The Quebec 2021 Budget announced a decrease in the small business tax rate, to 3.2% effective for a corporation's taxation years ending after March 25, 2021, the day of the budget speech.  Quebec has more "eligibility requirements" for the SBD than other provinces.  See Changes to the Small Business Deduction in their April 28, 2021 Tax News, as well as Small Business Deduction (in French only).

(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.

Their 2021 Budget reduces the rate to 1% effective January 1, 2022.

(5) Yukon's 2020 Budget announced that the small business corporate income tax rate would be reduced to zero effective January 1, 2021. This automatically reduces their non-eligible dividend tax credit for 2021.

(6) Northwest Territories' 2021 Budget reduced the small business corporate income tax rate from 4% to 2% effective January 1, 2021.

(7) Saskatchewan's Bill 2, which received Royal Assent on Dec 10, 2020, reduced the Small Business corporate tax rate to 0% effective Oct 1, 2020, with an increase to 1% on Jul 1, 2022 and to 2% on Jul 1, 2023.

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 21, 2021

 

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

Facebook  | Twitter  |  See What’s New, stay connected with TaxTips.ca by RSS or Email
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.