Federal Tax Brackets 2026
Federal income tax applies the same way in every province and territory. Each rate applies only to the slice of taxable income inside its band — moving into a higher bracket never taxes your whole income at the higher rate.
The 2026 federal brackets
| Taxable income | Federal rate |
|---|---|
| $0 – $58,523 | 14% |
| $58,523 – $117,045 | 20.5% |
| $117,045 – $181,440 | 26% |
| $181,440 – $258,482 | 29% |
| $258,482 – and above | 33% |
What changed for 2026
The lowest federal rate is now 14%. The cut from 15% took effect halfway through 2025, so 2025 was taxed at a blended effective rate and 2026 is the first full year at the lower rate. Bracket thresholds are indexed to inflation each 1 January.
The basic personal amount
The federal basic personal amount is $16,452 for 2026. It is a non-refundable tax credit worth 14% of that amount, not a slice of income that escapes tax. It is reduced for higher earners, falling from $16,452 at $181,440 of net income to $14,829 at $258,482. More on how the amount works →
The Canada employment amount
Employees also get the Canada employment amount, a credit on the first $1,501 of employment income, worth $210.14 at the lowest federal rate.
Common questions
What is the lowest federal tax rate in 2026?
14%, applying to the first $58,523 of taxable income.
What is the top federal tax rate in 2026?
33% on taxable income above $258,482. Provincial tax applies on top of this.
Does moving into a higher bracket tax all my income at that rate?
No. Each rate applies only to the income inside its band. A raise that crosses a bracket boundary is taxed at the higher rate only on the part above the boundary.
Sources: Canada Revenue Agency — T4127 Payroll Deductions Formulas (122nd and 123rd editions, 2026) and the published 2026 federal, provincial and territorial rate tables; Revenu Québec — 2026 income tax rates and the 2026 source-deduction parameters. Rates verified 9 August 2026.
Figures are computed from those published rates by our own engine, which is validated against the CRA’s Payroll Deductions Online Calculator. See how we calculate.