What's New
- Tax rate change – lowest individual income tax rate - Starting July 1, 2025, the lowest individual income tax rate was reduced from 15% to 14%. Since the change took effect halfway through the year, the full-year lowest marginal individual income tax rate for 2025 will be 14.5%.
- Top-up tax credit - A new non-refundable tax credit has been introduced to effectively maintain a 15% rate for certain non-refundable tax credits claimed on amounts over the first income tax bracket threshold of $57,375 for 2025.
- Canada Disability Benefit - Applications for the Canada Disability Benefit (CDB) opened in June 2025. This new federal benefit is for working-age Canadians (aged 18 to 64) with disabilities, who will receive up to $2,400 per year (maximum $200 per month), based on their adjusted family net income. (The benefit amount will rise with inflation.) To qualify, you must be a Canadian resident who is certified to receive the Disability Tax Credit (DTC), and you must have filed your previous year tax return. (Payments are retroactively available back to July 2025.) Receiving the CDB won't affect your eligibility for other federal benefits, and the federal government has said it plans to table legislation to make the CDB tax- exempt.
- The last Canada Carbon Rebate payment - In March 2025, the federal government ended pollution pricing at the gas pump, along with the tax-free Canada Carbon Rebate payments meant to help individuals and families in applicable provinces offset the added cost. The final rebate payment went out in April to individuals who filed a 2024 tax return. If you're behind on your tax filing, take note: the 2025 federal budget calls for no more Canada Carbon Rebate payments “made in respect of tax returns, or adjustment requests, filed after October 30, 2026.”
- End of the Digital News Subscription Tax Credit - As of 2025, you can no longer claim this non-refundable tax credit, which previously offered taxpayers a 15% credit, up to $75 per year, for buying subscriptions to Qualified Canadian Journalism Organizations (QCJOs). If you're self-employed, you might still be able to claim digital subscriptions as a business expense, if you use them to keep up with industry news.
- Ontario fertility treatment tax credit - A new refundable fertility treatment tax credit of 25% of eligible expenses up to $20,000, for a maximum credit of $5,000, has been introduced.