These are the new tax brackets for Canadians in 2025

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The federal government has made some inflation-based adjustments to the tax brackets Canadians fall into and their allowable RRSP contribution room. Here’s what you need to know.

Shifting tax brackets

For 2025, income tax brackets are increasing. Federal tax is 15 per cent for earnings up to $57,375; 20.5 per cent for between $57,375.01 and $114,750; and 26 per cent for incomes between $114,750.01 and $177,882.

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The tax rate is 29 per cent for earners with an income between $177,882.01 and $253,414. Anything beyond that will be taxed at 33 per cent.

Basic personal amount

This is the amount of your income that will not be taxed federally. For the 2025 tax year, the basic personal amount ranges from $14,538 to $16,129 depending on your overall income.

That’s up from 2024, when the range was $14,256 to $15,705.

Registered Retirement Savings Plans

For the 2024 tax year, Canadians can contribute to their registered retirement savings plan (RRSP) until March 3, 2025.

The threshold is going up to $32,490 in 2025 from $31,560 in 2024, as well as any available contribution room left over from previous tax years.

Taxpayers can determine their unused RRSP contribution room by looking at last year’s tax assessment from the Canada Revenue Agency or looking at their online CRA accounts.

The tax-free savings account (TFSA) contribution limit will stay the same, at $7,000, following two consecutive years of increases. However, Canadians can continue to benefit from this tax-free option to grow their savings without incurring taxes on interest or gains.

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