Canada uses a two-layer income tax system: federal tax paid to the CRA, plus provincial or territorial tax on top. For 2026, the federal side got a notable change — the lowest rate dropped to 14%, applying for a full calendar year for the first time.
2026 federal brackets
14% on the first $58,523, 20.5% on $58,523–$117,045, 26% on $117,045–$181,440, 29% on $181,440–$258,482, and 33% above that. These are marginal rates — only the portion of income inside each band is taxed at that band's rate.
The Basic Personal Amount
The federal Basic Personal Amount (BPA) is $16,452 for 2026, applied as a non-refundable credit at the 14% rate — worth up to $2,303 off your federal tax bill. High earners above roughly $181,000 see this amount gradually reduced.
Provincial tax varies enormously
Alberta's flat 10% provincial rate makes it the lowest-tax province at most income levels, with no provincial sales tax on top. Ontario and Quebec use their own progressive brackets, and combined federal + provincial marginal rates at the top end range from about 36% in Alberta to over 53% in some other provinces.
Get your federal estimate with the Canada Income Tax Calculator.