Canadian Tax Changes 2026
A side-by-side comparison of every key federal tax figure that changed between 2025 and 2026 — income tax brackets, the Basic Personal Amount, CPP, EI, RRSP, and TFSA limits.
Federal Income Tax Brackets
Federal brackets are indexed to inflation each year. All five brackets shifted upward for 2026.
| Rate | 2025 Range | 2026 Range |
|---|---|---|
| 14% | $0 – $57,375 | $0 – $58,523 |
| 20.5% | $57,375 – $114,750 | $58,523 – $117,045 |
| 26% | $114,750 – $177,882 | $117,045 – $181,440 |
| 29% | $177,882 – $253,414 | $181,440 – $258,482 |
| 33% | Over $253,414 | Over $258,482 |
Basic Personal Amount
The Basic Personal Amount (BPA) is a non-refundable tax credit applied at the lowest federal rate — the "appropriate percentage," which also changed for 2026: 14.5% (2025, a blended rate since the lowest bracket was cut mid-year) down to 14% (2026, the first full year at the new rate). The 2026 BPA increased from $16,129 to $16,452, credited at $2,303 in 2026 vs $2,339 in 2025.
| Item | 2025 | 2026 |
|---|---|---|
| Basic Personal Amount | $16,129 | $16,452 |
| Credit Rate (appropriate percentage) | 14.5% | 14% |
Canada Pension Plan (CPP)
CPP contributions are split between a base plan (CPP1) and a second additional component (CPP2) on earnings above the YMPE. The Year's Maximum Pensionable Earnings rose for 2026 while the employee contribution rate held steady.
| Item | 2025 | 2026 |
|---|---|---|
| Employee Contribution Rate (CPP1) | 5.95% | 5.95% |
| Year's Maximum Pensionable Earnings (YMPE) | $71,300 | $74,600 |
| CPP2 Employee Rate | 4% | 4% |
| CPP2 Maximum Earnings Ceiling | $81,200 | $85,000 |
Employment Insurance (EI)
EI premiums are calculated on insurable earnings up to the annual maximum. Quebec residents pay a lower rate because the province administers its own parental insurance program (QPIP).
| Item | 2025 | 2026 |
|---|---|---|
| Employee Premium Rate | 1.64% | 1.63% |
| Quebec Employee Rate | 1.31% | 1.3% |
| Maximum Insurable Earnings | $65,700 | $68,900 |
RRSP & TFSA Limits
The RRSP deduction limit increased for 2026, while the TFSA annual limit remained unchanged at $7,000.
| Item | 2025 | 2026 |
|---|---|---|
| RRSP Maximum Contribution | $32,490 | $33,810 |
| TFSA Annual Limit | $7,000 | $7,000 |
Frequently asked questions
What is the biggest federal tax change for 2026?
The lowest federal bracket rate is 14% for the first full year at that rate (it was a blended 14.5% in 2025 due to a mid-year cut), and the Basic Personal Amount rose from $16,129 to $16,452.
How much more CPP will I pay in 2026?
The Year's Maximum Pensionable Earnings (YMPE) rose from $71,300 to $74,600, and the CPP2 ceiling rose from $81,200 to $85,000. The employee contribution rate itself held steady at 5.95%.
Did the TFSA and RRSP limits change for 2026?
The RRSP maximum contribution rose from $32,490 to $33,810. The TFSA annual limit stayed at $7,000, unchanged from 2025.
Is the EI premium rate going up or down for 2026?
The employee EI premium rate moved from 1.64% to 1.63%, while the Maximum Insurable Earnings rose from $65,700 to $68,900.
See how these changes affect your pay
Use our calculators to see your 2026 federal and provincial tax, updated for the new brackets and rates.