Federal income tax brackets for 2026 and what provinces add
Canadian federal income tax uses five progressive brackets. The top rate of 33% applies to taxable income above $258,482. Provincial or territorial income tax is added on top of the federal amount, and each province sets its own brackets and rates.
- 2026 federal tax brackets
- 14% on the first $58,523; 20.5% on $58,523.01 to $117,045; 26% on $117,045.01 to $181,440; 29% on $181,440.01 to $258,482; 33% on the portion above $258,482.CRA, Federal rate 2026
- 2026 basic personal amount
- $16,452 for individuals with net income at or below the 29% bracket threshold ($181,440); reduced to $14,829 for individuals with net income at or above the 33% bracket threshold ($258,482).CRA, Indexation adjustment
- Brackets are progressive
- Each rate applies only to the portion of taxable income that falls within that bracket, not to all income.CRA, How tax rates and brackets work
- Provincial tax
- Each province and territory adds its own income tax on top of the federal amount, with its own brackets and rates.CRA, Provincial or territorial rates 2026
Five brackets, applied progressively
Canadian federal income tax is charged at five rates on successive portions of taxable income. CRA, Federal rate 2026 (opens in a new tab).
Worked example using the money.financial calculator for 2026 taxable income of $80,000: the first $58,523 is taxed at 14%, which is $8,193.22; the remaining $21,477 is taxed at 20.5%, which is $4,402.79. Federal income tax before credits is $8,193.22 plus $4,402.79, which is $12,596.01. The marginal rate on the next dollar above $80,000 is 20.5%. This example uses only the federal calculation and excludes credits, provincial tax, CPP and EI.
Each bracket threshold is indexed to inflation each year. The bracket a dollar of income falls into is determined by which threshold the income crosses. CRA, Indexation adjustment (opens in a new tab)
Provincial income tax is a separate layer
Provincial and territorial income tax is charged in addition to federal income tax. Each province and territory sets its own brackets and rates, and the provincial amount depends on the province or territory of residence on December 31 of the tax year. A person living in Ontario pays Ontario income tax on top of federal income tax; a person living in British Columbia pays BC income tax; a person living in Quebec pays Quebec income tax under Quebec's system. CRA, Provincial or territorial rates 2026 (opens in a new tab)
Provincial income tax is not a percentage of federal tax. It is calculated on the same taxable income base using provincial brackets and rates, which are separate from the federal schedule. Quebec's system is distinct and administers its own income tax collection separate from the federal government. CRA, Provincial or territorial rates 2026 (opens in a new tab)
This page is an original explanation of CRA material and does not imply CRA endorsement. This page covers federal tax only and does not describe provincial tax rates, credits, or the Quebec income tax system.