The Canada Revenue Agency (CRA) has announced the updated federal income tax brackets for 2025, reflecting inflation adjustments.
While federal tax rates remain unchanged, the income thresholds for each tax bracket have been revised.
The brackets have been adjusted for inflation, with an indexation increase of 2.7% for 2025.
The following chart provides the indexed amounts for four tax years based on the announced personal income tax and benefit commitments to date.
| Indexation increase per year | ||||
|---|---|---|---|---|
| 2025 | 2024 | 2023 | 2022 | |
| Indexation increase | 2.7% | 4.7% | 6.3% | 2.4% |
| Tax Bracket Thresholds | ||||
|---|---|---|---|---|
| Description | 2025 | 2024 | 2023 | 2022 |
| Taxable income above which the 20.5% bracket begins | $57,375 | $55,867 | $53,359 | $50,197 |
| Taxable income above which the 26% bracket begins | $114,750 | $111,733 | $106,717 | $100,392 |
| Taxable income above which the 29% bracket begins | $177,882 | $173,205 | $165,430 | $155,625 |
| Taxable income above which the 33% bracket begins | $253,414 | $246,752 | $235,675 | $221,708 |
