Canada tax brackets 2026: federal rates, provincial rates and what you really pay
"I got a raise and moved into a higher bracket, so I will take home less." It is one of the most common money myths in Canada, and it is wrong, because tax brackets apply to slices of income and not to the whole amount. This guide gives you the 2026 federal brackets, the provincial tables for Ontario, British Columbia, Alberta and Quebec, the basic personal amount, and a worked example showing the difference between your marginal and average tax rate.
On this page
2026 federal brackets
These are the rates the CRA lists for the 2026 tax return, based on taxable income, which is your income after deductions such as RRSP contributions:
| Taxable income | Federal rate |
|---|---|
| Up to $58,523 | 14% |
| $58,523.01 to $117,045 | 20.5% |
| $117,045.01 to $181,440 | 26% |
| $181,440.01 to $258,482 | 29% |
| Over $258,482 | 33% |
The CRA says the thresholds are adjusted each year for inflation, and for 2026 the indexation increase is 2.0%. The 2026 returns you file in spring 2027 use these figures. Our first paycheque deductions guide shows how this tax, CPP and EI come off your pay along the way.
The basic personal amount
Everyone gets a federal credit for a basic personal amount, which means the first slice of income is effectively untaxed federally. For 2026 the CRA lists:
- Maximum: $16,452, for net income at or below $181,440 (where the 29% bracket starts).
- Minimum: $14,829, for net income at or above $258,482 (where the 33% bracket starts).
- Between those two points, the amount is $14,829 plus an enhanced amount of up to $1,623 that phases down as income rises.
The credit is worth the basic personal amount times the lowest federal rate. At 14%, the maximum amount is worth $16,452 x 14% = $2,303.28 off federal tax. Provinces have their own personal amounts too, which are not covered here. If your income is very low you may owe nothing at all; read whether you need to file on a low income, because filing can still unlock benefits.
How brackets actually work
Canada has a progressive system. Each rate applies only to the part of your taxable income that falls inside that bracket. Crossing a threshold never reduces your after-tax income; only the next dollar is taxed at the higher rate. Two numbers matter:
- Marginal rate: the combined federal and provincial rate on your next dollar of income. It drives decisions about RRSP contributions, side income and withdrawals.
- Average rate: total tax divided by total income. It tells you what share of your income goes to tax overall, and it is always lower than your marginal rate (unless all your income is in the first bracket).
Provincial tax is calculated on the same taxable income with its own brackets, and the two are added. The CRA notes that your province is the one where you lived on December 31 of the tax year, so a mid-year move changes the whole year; see moving provinces and taxes.
Provincial and Quebec tables
The CRA lists these 2026 provincial rates. Quebec residents file a separate provincial return, and the Quebec figures below come from Revenu Québec.
Ontario
| Taxable income | Rate |
|---|---|
| Up to $53,891 | 5.05% |
| $53,891.01 to $107,785 | 9.15% |
| $107,785.01 to $150,000 | 11.16% |
| $150,000.01 to $220,000 | 12.16% |
| Over $220,000 | 13.16% |
British Columbia
| Taxable income | Rate |
|---|---|
| Up to $50,363 | 5.6% |
| $50,363.01 to $100,728 | 7.7% |
| $100,728.01 to $115,648 | 10.5% |
| $115,648.01 to $140,430 | 12.29% |
| $140,430.01 to $190,405 | 14.7% |
| $190,405.01 to $265,545 | 16.8% |
| Over $265,545 | 20.5% |
Alberta
| Taxable income | Rate |
|---|---|
| Up to $61,200 | 8% |
| $61,200.01 to $154,259 | 10% |
| $154,259.01 to $185,111 | 12% |
| $185,111.01 to $246,813 | 13% |
| $246,813.01 to $370,220 | 14% |
| Over $370,220 | 15% |
Quebec
| Taxable income | Rate |
|---|---|
| Up to $54,345 | 14% |
| $54,345 to $108,680 | 19% |
| $108,680 to $132,245 | 24% |
| Over $132,245 | 25.75% |
Other provinces and territories are listed on the CRA page linked in the sources. Provincial surtaxes, health premiums and credits (Ontario has some) are separate from these bracket rates and are not included in the tables. Your combined rate in any slice is the federal rate plus the provincial rate, for example 14% + 5.05% = 19.05% in Ontario at low incomes.
Worked example: marginal vs average
Maya lives in Ontario and has $80,000 of taxable income in 2026. The numbers below use the brackets above and show tax before credits, the Ontario surtax and the Ontario Health Premium.
| Slice | Arithmetic | Tax |
|---|---|---|
| Federal, first $58,523 | $58,523 x 14% | $8,193.22 |
| Federal, next $21,477 | $21,477 x 20.5% | $4,402.79 |
| Ontario, first $53,891 | $53,891 x 5.05% | $2,721.55 |
| Ontario, next $26,109 | $26,109 x 9.15% | $2,388.97 |
| Total before credits | $17,706.53 | |
| Federal basic personal amount credit | $16,452 x 14% | - $2,303.28 |
Average rate (before credits): $17,706.53 / $80,000 = 22.1%. Marginal rate: Maya is in the 20.5% federal bracket and the 9.15% Ontario bracket, so her next dollar is taxed at 20.5% + 9.15% = 29.65%. If she earns an extra $1,000, her tax rises by about $296.50 and she keeps about $703.50. She does not lose money by crossing a bracket, and her higher marginal rate only touches the new income.
This also explains why a $1,000 RRSP contribution is worth about $296.50 in tax savings to Maya, while for someone in a lower bracket it is worth less. See how the RRSP works and the RRSP deadline. If you plan to withdraw later, RRSP withdrawal tax explains how withdrawals stack onto your income.
Ways income gets taxed less
- Deductions lower taxable income before brackets apply, such as RRSP contributions; see RRSP vs TFSA for how they compare to tax-free growth.
- Credits reduce tax after it is calculated; the tuition tax credit is one example.
- Self-employed income is taxed the same way but with different deductions and no payroll withholding; read side hustle taxes.
- Benefits such as the federal benefit payments depend on net income, so brackets are only part of the picture.
More calculators are on the tools page.
Questions people ask
What are the federal tax brackets for 2026?
For 2026 the federal rates are 14% up to $58,523, 20.5% from $58,523 to $117,045, 26% from $117,045 to $181,440, 29% from $181,440 to $258,482, and 33% over $258,482.
What is the basic personal amount in 2026?
The CRA lists a maximum federal basic personal amount of $16,452 for net income at or below $181,440 and a minimum of $14,829 for net income at or above $258,482, with a phase-down in between.
If I move into a higher bracket, do I lose money?
No. Only the income above the threshold is taxed at the higher rate. Your total tax goes up with income, but your after-tax income also goes up.
What is the difference between marginal and average tax rate?
Your marginal rate is the combined federal and provincial rate on your next dollar. Your average rate is your total tax divided by your total income, and it is lower than your marginal rate.
How do I add up federal and provincial tax?
Calculate federal tax with the federal brackets and provincial tax with your province's brackets on the same taxable income, then add them. Credits and any provincial surtaxes or premiums are separate.
Which province do I use if I moved during the year?
The CRA says your province is determined by where you lived on December 31 of the tax year.
What is the lowest federal tax rate in 2026?
The lowest federal rate is 14% on taxable income up to $58,523.
Where do the 2026 numbers come from?
From the CRA page listing tax rates and income brackets for the 2026 tax return, the CRA indexation page and, for Quebec, Revenu Québec.
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Sources
Canada Revenue Agency, Tax rates and income brackets for the 2026 tax return (federal, Ontario, British Columbia and Alberta brackets; province of residence on December 31), Adjustment of personal income tax and benefit amounts (2.0% indexation for 2026, basic personal amount of $16,452 maximum and $14,829 minimum) and Revenu Québec, Income tax rates (2026 Quebec brackets). The Maya example is illustrative; the arithmetic is ours and ignores credits other than the federal basic personal amount, the Ontario surtax and the Ontario Health Premium.