The Federal tax brackets and personal tax credit amounts are increased for 2025 by an indexation factor of 1.027 (a 2.7% increase).
The lowest personal tax rate was reduced from 15% to 14% effective July 1, 2025, resulting in an effective tax rate for 2025 of 14.5%, and 14% for 2026 and later years. The 14.5% and 14% are be used for personal tax credit calculations.
See Indexation of the Personal Income Tax System for how the indexation factors are calculated, and for the notice from CRA that they are administering the proposed capital gains inclusion rate legislation.
The federal indexation factors, tax brackets and tax rates for 2025 have been confirmed to Canada Revenue Agency (CRA) information. See Indexation adjustment for personal income tax and benefit amounts on the CRA website.
In order to determine the total tax rate paid in your province or territory, see the combined marginal tax rates for your province or territory. If you are not a resident of Canada, see Who Pays Tax in Canada and on What Income?
Tax Tip: read the article Understanding the Tables of Personal Income Tax Rates, especially if you are trying to compare the rates below to the marginal tax rates in the Basic Tax Calculator or the Detailed Tax Calculators.
| TaxTips.ca - Canadian Tax Rates - Federal | |||||||||
| 2025 Taxable Income(1) | Canada 2025 Marginal Tax Rates | 2024 Taxable Income(1) | Canada 2024 Marginal Tax Rates | ||||||
| Other Income |
Capital Gains | Canadian Dividends | Other Income |
Capital Gains |
Canadian Dividends | ||||
| Eligible | Non-Eligible | Eligible | Non-Eligible | ||||||
| first $57,375 | 14.50% | 7.25% | -0.72% | 6.29% | first $55,867 | 15.00% | 7.50% | -0.03% | 6.87% |
| over $57,375 up to $114,750 | 20.50% | 10.25% | 7.56% | 13.19% | over $55,867 up to $111,733 | 20.50% | 10.25% | 7.56% | 13.19% |
| over $114,750 up to $177,882 | 26.00% | 13.00% | 15.15% | 19.52% | over $111,733 up to $173,205 | 26.00% | 13.00% | 15.15% | 19.52% |
| over $177,882 up to $253,414 | 29.31% | 14.66% | 19.72% | 23.33% | over $173,205 up to $246,752 | 29.32% | 14.66% | 19.73% | 23.34% |
| over $253,414 | 33.00% | 16.50% | 24.81% | 27.57% | over $246,752 | 33.00% | 16.50% | 24.81% | 27.57% |
| Marginal tax rate for dividends is a % of actual
dividends received (not grossed-up taxable amount). Marginal tax rate for capital gains is a % of total capital gains (not taxable capital gains). Gross-up rate for eligible dividends is 38%, and for non-eligible dividends is 15%. For more information see dividend tax credits. Copyright © 2002 Boat Harbour Investments Ltd. |
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| TaxTips.ca Federal Basic Personal Amount |
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| 2025 Personal Amounts (1) | 2025 Tax Rate | 2024 Personal Amounts (1) | 2024 Tax Rate | ||||||
| Minimum | $14,538 | 14.5% | Minimum | $14,156 | 15% | ||||
| Maximum | 16,129 | 14.5% | Maximum | 15,705 | 15% | ||||
(1) The personal amounts for 2025 and 2024 are increased federally and for Yukon:
- for 2025: from $14,539 to $16,129 for taxpayers with net income (line 23600) of $177,882 or less. For incomes above this threshold, the additional amount of $1,590 is reduced until it becomes zero at net income of $253,414.
- for 2024: from $14,156 to $15,705 for taxpayers with net income (line 23600) of $173,205 or less. For incomes above this threshold, the additional amount of $1,549 is reduced until it becomes zero at net income of $246,752.
The minimum and maximum personal amounts for 2025 are indexed from the 2024 amounts.
The marginal tax rates in blue above have been adjusted to reflect these changes. The table of marginal tax rates assume that line 23600 net income is equal to taxable income for this purpose.
For 2025, the marginal rate for $177,882 to $253,414 is 29.32% because of the above-noted personal amount reduction through this tax bracket. The additional 0.32% is calculated as 15% x ($16,129 - 14,539) / ($253,414 - $177,802).
For 2024, the marginal rate for $173,205 to $246,752 is 29.32% because of the above-noted personal amount reduction through this tax bracket. The additional 0.32% is calculated as 15% x ($15,705 - $14,156) / ($246,752 - $173,205).
Since the minimum and maximum amounts are being indexed at the same rate for 2024 and later years, the marginal tax rate for the 4th tax bracket will remain at 29.32% in later years.
Copyright © 2002 Boat Harbour Investments Ltd.
Revised: September 28, 2025