Find the money you can keep
Canada rates and paperwork
Tax year 1 January to 31 December 2025, filed in 2026.
Federal and provincial figures as published by the Canada Revenue Agency for 2025. Family and childcare credits, and Quebec provincial credits, are not modelled.
Rates, allowances and thresholds
Federal income tax
- 14.5%
- up to $57,375
- 20.5%
- $57,376 to $114,750
- 26%
- $114,751 to $177,882
- 29%
- $177,883 to $253,414
- 33%
- above $253,414
- Basic personal amount
- $16,129
- Quebec abatement
- 16.5% off federal tax
The first bracket rate for 2025 as published by the CRA
Reduced for very high incomes
Quebec residents pay provincial tax through a separate TP-1 return
Provincial and territorial tax
Each province and territory sets its own brackets on top of the federal tax, and Quebec collects its own.
- Lowest first-bracket rates
- Nunavut 4%, British Columbia 5.06%, Ontario 5.05%
- Highest top rates
- Quebec 25.75%, Nova Scotia 21%, Ontario 13.16% plus surtax
- Which province applies
- The one you lived in on 31 December
- Ontario extras
- The Ontario surtax and health premium are charged separately and are not modelled here
CPP and EI
- CPP basic exemption
- $3,500
- CPP earnings ceiling
- $71,300 at 5.95% for employees
- CPP2
- 4% on earnings from $71,300 to $81,200
- EI ceiling
- $65,700
- EI rate
- 1.64% outside Quebec, 1.31% in Quebec
- Self-employed CPP
- Both halves, so double the employee rate, half of it deductible
Registered accounts
- RRSP room
- 18% of earned income, capped at $32,490
- RRSP deadline
- 60 days after the year end, usually 1 or 2 March
- TFSA room
- $7,000 for 2025
- FHSA
- $8,000 a year, $40,000 lifetime
- RESP grant
- 20% Canada Education Savings Grant on the first $2,500 a year per child
Unused room carries forward
No deduction going in, no tax coming out
Deduction going in and tax free coming out for a first home
Capital gains and property
- Inclusion rate
- Half of a capital gain is taxable
- Principal residence
- Generally exempt, with the sale still reported on Schedule 3
- Capital losses
- Offset gains, carried back three years or forward indefinitely
- Eligible dividends
- Grossed up, then reduced by the dividend tax credit
Business
- Small business rate
- 9% federal on the first $500,000 of active business income, plus provincial tax
- General corporate rate
- 15% federal, plus provincial tax
- GST/HST registration
- Required once revenue passes $30,000 in four consecutive quarters
- Lifetime capital gains exemption
- Available on qualifying small business shares, farm and fishing property
What you can deduct or claim
RRSP contributions
Every dollar comes off your taxable income, up to your room shown on your notice of assessment.
Anyone with earned income
FHSA contributions
Deductible going in and tax free coming out when you buy a first home.
First-time buyers
Business use of home
A share of heat, power, rent, insurance and internet based on the space and hours used for work.
Self-employed
Childcare expenses
Usually claimed by the lower earning spouse, with receipts.
Parents
Medical expenses
Above a small threshold, for any 12 month period ending in the year, pooled for the family.
Everyone
Moving expenses
Deductible when you moved at least 40 km closer to work or school.
Movers
Union and professional dues
Deductible, and usually shown on your T4.
Employees
Donations
A credit rather than a deduction, worth more once total gifts pass $200 in the year.
Everyone
Forms to file with the CRA
| Form | What it does | When | Who needs it | Official page |
|---|---|---|---|---|
| T1 income tax and benefit return | Your annual personal return | 30 April, or 15 June if self-employed with the balance still due 30 April | Everyone | canada.ca |
| T2125 | Business or professional income and expenses | With the T1 | Self-employed | canada.ca |
| T776 | Rental income and expenses per property | With the T1 | Landlords | canada.ca |
| Schedule 3 | Capital gains and losses on anything you sold | With the T1 | Investors and property sellers | canada.ca |
| Schedule 7 | RRSP, PRPP and SPP contributions and deductions | With the T1 | RRSP contributors | canada.ca |
| T1135 | Foreign income verification statement | With the T1 | Anyone with foreign property costing over $100,000 | canada.ca |
| TD1 | Tells your employer which credits to apply to your pay | When you start a job or your situation changes | Employees | canada.ca |
Not covered here
- Ontario surtax and health premium, and other provincial surtaxes
- Quebec provincial tax credits and the TP-1 return
- Family, childcare and disability credits, and the Canada child benefit
Tax year: 2025. Your year ends 31 December.
That is the date most of these steps have to be done by.
Three countries now, more as we grow
Today Taxmiser covers the United Kingdom, the United States and Australia in full, with real rates and real forms. We add a new country only once its figures are checked against the official tax office, so nothing here is a guess. Canada, Ireland, New Zealand and more are next in line as we grow.
Every US state taxes you differently
In the United States there are two bills, not one. Federal tax is the same wherever you live. State tax is not. Some states take nothing, some take a flat slice, some have their own bands and their own allowances. That is why we ask which state you are in, and why two people on the same pay can keep very different amounts.
See the state by state figures