Taxes in Canada
Canada has a comprehensive tax system with federal, provincial, and sales taxes. Understanding your obligations is essential.
Tax Residency
You're a Canadian tax resident if you:
- Have significant residential ties (home, spouse, dependents in Canada)
- Stay 183+ days in a tax year
- Are a permanent resident (generally)
Tax residents pay tax on worldwide income.
Non-residents pay tax only on Canadian-source income.
Income Tax Rates (2026)
Federal Brackets:
| Income | Rate |
|---|---|
| Up to $55,867 | 15% |
| $55,867-$111,733 | 20.5% |
| $111,733-$173,205 | 26% |
| $173,205-$246,752 | 29% |
| Over $246,752 | 33% |
Provincial rates add 4-21% depending on province.
Combined top marginal rates:
- Quebec: 53.31%
- Ontario: 53.53%
- BC: 53.50%
- Alberta: 48% (lowest)
Sales Taxes
| Province | GST/HST | PST | Total |
|---|---|---|---|
| Alberta | 5% | 0% | 5% |
| BC | 5% | 7% | 12% |
| Ontario | 13% (HST) | - | 13% |
| Quebec | 5% | 9.975% | ~15% |
| Nova Scotia | 15% (HST) | - | 15% |
Key Filing Dates
- February 28: T4 slips due from employers
- April 30: Personal tax filing deadline
- June 15: Self-employed filing deadline (but payment still due April 30)
- Quarterly installments: March 15, June 15, Sept 15, Dec 15
For Newcomers
First year considerations:
- Only taxed on income earned after becoming resident
- May be eligible for tax treaty benefits
- Keep records of arrival date and worldwide income
Documents needed:
- T4 (employment income)
- T4A (pension, other income)
- T5 (investment income)
- Receipts for deductions
- Immigration documents showing entry date
Tax-Advantaged Accounts
| Account | Contribution Limit (2026) | Tax Treatment |
|---|---|---|
| RRSP | 18% of income, max ~$32,000 | Tax-deferred |
| TFSA | $7,000 | Tax-free growth |
| RESP | $2,500/year (for grant) | Education savings |
| FHSA | $8,000 | First home savings |
Tax Treaties
Canada has tax treaties with 90+ countries to prevent double taxation. Common provisions:
- Reduced withholding on dividends, interest, royalties
- Tiebreaker rules for residency
- Credits for foreign taxes paid
Getting Help
- Free tax clinics: Available for low-income individuals
- Tax software: TurboTax, Wealthsimple Tax, SimpleTax
- Professionals: CPAs for complex situations, $200-500+
Pro Tips
- •Open a TFSA immediately - contribution room accumulates from when you become resident
- •Keep all receipts - many expenses are deductible
- •Alberta has the lowest provincial taxes and no PST
- •Tax treaties may reduce double taxation - check your home country
- •Use free tax software for simple returns
Have questions about taxes in Canada?