2025 CRA tax brackets explained

The Canada Revenue Agency (CRA) has released updated federal income tax brackets for 2025, reflecting adjustments for inflation.

Federal tax rates remain the same, but the income thresholds for each bracket have shifted.

A person’s entire income isn’t taxed at a single rate. Instead, it’s split up into brackets, each with its own rate.

The indexation increase for 2025 is 2.7 per cent, according to the CRA. That’s lower than the 4.7 per cent increase in 2024.

Here are the income tax brackets for the upcoming year:

• 
  incomes within the $57,375 or less tax bracket will be taxed at 15 per cent;
• 
  incomes between the $57,375.01 to $114,750 tax bracket will be taxed at 20.5 per cent;
• 
  incomes between the $114,750.01 to 177,882 tax bracket will be taxed at 26 per cent;
• 
  incomes between the $177,882.01 to 253,414 tax bracket will be taxed at 29 per cent; and
• 
  incomes above $253,414.01 will be taxed at 33 per cent.

For more information on income tax brackets and basic personal amounts visit the CRA’s website.

With files from CTVNews.ca’s Christl Dabu