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Home  ->  Business   ->  Corporate Income Tax Rates  -> 2023 Corporate Income Tax Rates

2023 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 2023.

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 ($50 million for tax years that begin on or after the 2022 Federal Budget date of April 7, 2022).  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 corporate tax rate for personal services businesses (PSBs) has been 33% since January 1, 2016.  If you are incorporated, provide services, and employ 5 or fewer employees, you may be a personal services business (incorporated employee), which means higher corporate tax rates and limited expense deductions.

2023 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) 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) 16% 1% $500,000 16%
Quebec (3) 11.5% 3.2% $500,000 11.5%
Saskatchewan (4) 12% zero% / 1% $600,000 12%
Yukon 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) Quebec has more "eligibility requirements" for the SBD than other provinces.  See Small Business Deduction (in French only).

(4) Saskatchewan's Bill 89, which was tabled November 2, 2022, extended the 0% small business tax rate to June 30, 2023, with an increase to 1% for July 1, 2023 to June 30, 2024, and increased to 2% for the period commencing July 1, 2024.  This is also reflected in the delay of the increase in the non-eligible dividend tax credit rate.

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 Corporations Tax

Saskatchewan corporate income tax

Yukon income tax rates

Provincial Budgets

Revised: September 24, 2023

 

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