Income Tax Act s. 117, 117.1, 121
The Federal tax brackets and personal tax credit amounts are increased for 2023 by an indexation factor of 1.063 (a 6.3% increase).
See INDEXATION OF THE PERSONAL INCOME TAX SYSTEM for how the indexation factors are calculated. The federal indexation factors, tax brackets and tax rates for 2023 have been confirmed to Canada Revenue Agency (CRA) information.
In order to determine the total tax rate paid in your province or territory, see the tables below.
The PERSONAL AMOUNT is increased federally and for Yukon:
– for 2023: from $13,521 to $15,000 for taxpayers with net income (line 23600) of $165,430 or less. For incomes above this threshold, the additional amount of $1,479 is reduced until it becomes zero at net income of $235,675.
– for 2022: from $12,719 to $14,398 for taxpayers with net income (line 23600) of $155,625 or less. For incomes above this threshold, the additional amount of $1,679 is reduced until it becomes zero at net income of $221,708.
– for 2021: from $12,421 to $13,808 for taxpayers with net income (line 23600) of $151,978 or less. For incomes above this threshold, the additional amount of $1,387 is reduced until it becomes zero at net income of $216,511.
The minimum personal amounts ($12,719 for 2022, $12,421 for 2021) are indexed.
The maximum personal amounts are stated in the Income Tax Act, but will be indexed after 2023.
The marginal tax rates in blue above have been adjusted to reflect these changes. The table of marginal tax rates assume that line 23600 net income is equal to taxable income for this purpose.
For 2023, the marginal rate for $165,430 to $235,675 is 29.32% because of the above-noted personal amount reduction through this tax bracket. The additional 0.32% is calculated as 15% x ($15,000 – $13,521) / ($235,675 – $165,430).
For 2022, the marginal rate for $155,625 to $221,708 is 29.38% because of the above-noted personal amount reduction through this tax bracket. The additional 0.38% is calculated as 15% x ($14,398 – $12,719) / ($221,708 – $155,625).
For 2021, the marginal rate for $151,978 to $216,511 is 29.32% because of the above-noted personal amount reduction through this tax bracket. The additional 0.32% is calculated as 15% x ($13,808 – $12,421) / ($216,511 – $151,978).