Taxation (Federal and Provincial Tax) is a critical component of the Canadian economy, as it plays a significant role in funding government programs and services.
In Canada, there are two types of taxes: federal and provincial taxes. While the federal government collects taxes from all Canadian residents, provincial governments also levy taxes, which vary based on the province or territory.
The federal government determines the federal tax brackets and rates, while each province or territory establishes its own provincial or territorial tax brackets and rates.
The Canadian tax system operates on a progressive basis, meaning that as income increases, the percentage of income paid in taxes also increases.
This system ensures that those who earn more contribute a larger proportion of their income in taxes.
The federal and provincial governments adjust tax brackets and rates annually to account for inflation and changes in the cost of living.
These changes can have a significant impact on taxpayers’ bottom line, making it crucial for individuals and businesses to stay informed about the latest updates in tax law.
By understanding the tax system and planning accordingly, you can ensure you are fulfilling your tax obligations while maximizing your financial resources.
Here I cover the federal and provincial tax brackets and rates in Canada for 2023.
- The key takeaway from this article is that the amount of tax you pay in Canada will depend on your income and province/territory of residence.
That being said, let’s go into the details of Canada federal and provincial tax brackets and rates for 2023.
Table of Contents
Federal Income Tax Brackets and Rates in Canada For 2023
Below are the 2023 federal tax brackets and rates in Canada.
| Federal Income Tax Bracket | Federal Income Tax Rate |
| Initial $53,359 | 15.00% |
| Above $53,359 to $106,717 | 20.50% |
| Above $106,717 to $165,430 | 26.00% |
| Above $165,430 to $235,675 | 29.32% |
| Above $235,675 | 33.00% |
One thing to note is that Canada’s federal tax rates have remained the same since 2021. But there’s a notable difference in the tax brackets.
Provincial and Territorial Tax Brackets & Rates in Canada For 2023
Each Canadian province and territory has its ownr tax brackets and rates that exist separately from the federal tax brackets and rates.
So knowing your provincial/territorial tax brackets is important in determining your overall tax rate.
Below I present the 2023 tax brackets and rates of each Canadian province and territory.
Ontario Tax Brackets and Rates 2023
Here are Ontario’s tax brackets and tax rates for 2023.
| Tax Bracket | Tax Rate |
| Initial $49,231 | 5.05% |
| Above $49,231 up to $98,463 | 9.15% |
| Above $98,463 up to $150,000 | 11.16% |
| Above $150,000 up to $220,000 | 12.16% |
| Above $220,000 | 13.16% |
Compared to other provincial tax rates, it’s safe to say Ontario’s tax rates are on the low side. The rates have remained the same since 2021 as with the federal tax rates.
British Columbia Tax Brackets and Rates 2023
Below are the 2023 tax brackets and rates in British Columbia:
| Tax Bracket | Tax Rate |
| Initial $45,654 | 5.06% |
| Above $45,654 up to $91,310. | 7.70% |
| Above $91,310 up to $104,835 | 10.50% |
| Above $104,835 up to $127,299 | 12.29% |
| Above $127,299 up to $172,602 | 14.70% |
| Above $172,602 up to $240,716 | 16.8% |
| Above $240,716 | 20.50% |
The BC tax rates were unchanged since 2021 and the rates are among the highest in Canada.
Alberta Tax Brackets and Rates 2023
Below are the 2023 tax brackets and rates in Alberta:
| Tax Bracket | Tax Rate |
| Initial $142,292 | 10% |
| Above $142,292 up to $170,751 | 12% |
| Above $170,751 up to $227,668 | 13% |
| Above $227,668 up to $341,502 | 14% |
| Above $341,502 | 15% |
As with the above provinces, the tax rates in Alberta were unchanged since 2021. Also, the rates are not among the lowest or highest.
Manitoba Tax Brackets and Rates 2023
The following are Manitoba’s tax brackets and rates for 2023
| Tax Bracket | Tax Rate |
| Initial $36,842 | 10.80% |
| Above $36,842 up to $79,625 | 12.75% |
| Above $79,625 | 17.4% |
Manitoba didn’t also make any changes to its 2023 tax rates. However, the rates are among the highest.
Nova Scotia Tax Brackets and Rates 2023
Here are Nova Scotia’s tax brackets and rates for 2023.
| Tax Bracket | Tax Rate |
| Initial $29,590 | 8.79% |
| Above $29,590 up to $59,180 | 14.95% |
| Above $59,180 up to $93,000 | 16.67% |
| Above $93,000 up to $150,000 | 17.5% |
| Above $150,000 | 21% |
Comparatively speaking, it’s obvious that Nova Scotia tax rates for 2023 are above average. Although the tax rates remained the same since 2021.
New Brunswick Tax Brackets and Rates 2023
Below are New Brunswick’s tax brackets and rates for 2023.
| Tax Bracket | Tax Rate |
| Initial $47,715 | 9.4% |
| Above $47,715 up to $95,431 | 14% |
| Above $95,431 up to $176,756 | 16% |
| Above $176,756 | 19.5% |
Compared to its 2022 tax rates, New Brunswick’s 2023 tax rates are low. But if you compare NB’s 2023 tax rates with those of other provinces, you will realize that NB’s rates are on the high side.
Prince Edward Island Tax Brackets and Rates 2023
The following are the 2023 tax brackets and rates in Prince Edward Island.
| Tax Bracket | Tax Rate |
| Initial $31,984 | 9.8% |
| Above $31,984 up to $63,969 | 13.8% |
| Above $63,969 | 16.7% |
Compared to other provincial tax rates, PEI’s 2023 tax rates are above average. What’s notable here is that the tax brackets and rates remained the same since 2021.
Newfoundland and Labrador Tax Brackets and Rates 2023
Here are the 2023 tax brackets and rates in Newfoundland and Labrador.
| Tax Bracket | Tax Rate |
| $41,457 | 8.7% |
| Above $41,457 up to $82,913 | 14.5% |
| Above $82,913 up to $148,027 | 15.8% |
| Above $148,027 up to $207,239 | 17.8% |
| Above $207,239 up to $264,750 | 19.8% |
| Above $264,750 up to $529,500 | 20.8% |
| Above $529,500 up to $1,059,000 | 21.3% |
The 2023 tax rates in Newfoundland and Labrador are among the highest. Also, the rates change significantly from those of 2022.
Saskatchewan Tax Brackets and Rates 2023
Below are the 2023 tax brackets and rates in Saskatchewan.
| Tax Bracket | Tax Rate |
| Initial $49,720 | 10.50% |
| Above $49,720 up to $142,058 | 12.50% |
| Above $142,058 | 14.50% |
Comparatively speaking, Saskatchewan’s 2023 tax rates are above average. Although there are no changes in 2023 rates.
Québec Tax Brackets and Rates 2023
The following are Québec’s 2023 tax brackets and tax rates.
| Tax Bracket | Tax Rate |
| Initial $49,275 | 15% |
| Above $49,275 up to $98,540. | 20% |
| Above $98,540 up to $119,910 | 24% |
| Above $119,910 | 25.75% |
Despite having no changes in tax rates for 2023, Québec has retained its position as the province with the highest provincial tax rates in Canada.
Yukon Tax Brackets and Rates 2023
Below are the 2023 tax brackets and rates in Yukon.
| Tax Bracket | Tax Rate |
| Initial $53,359 | 6.40% |
| Above $53,359 up to $106,717 | 9.00% |
| Above $106,717 up to $165,430 | 10.90% |
| Above $165,430 up to $235,675 | 12.93% |
| Above $235,675 up to $500,000 | 12.80% |
| Above $500,000 | 15.00% |
Yokun tax rates didn’t change for 2023. Even though the rates are not on the lower side, they’re not among the highest.
Nunavut Tax Brackets and Rates 2023
The following are Nunavut’s tax brackets and rates for 2023.
| Tax Bracket | Tax Rate |
| Initial $50,877 | 4.00% |
| Above $50,877 up to $101,754 | 7.00% |
| Above $101,754 up to $165,429 | 9.00% |
| Above $165,429 | 11.50% |
Nunavut has been rated as the territory with the lowest tax rates among Canadian provinces and territories. The territory didn’t change its tax rates for 2023.
Northwest Territories Tax Brackets and Rates 2023
Below are the 2023 tax brackets and rates in Northwest Territories.
| Tax Bracket | Tax Rate |
| Initial $48,326 | 5.9% |
| Above $48,326 up to $96,655 | 8.6% |
| Above $96,655 up to $157,139 | 12.2% |
| Above $157,139 | 14.5% |
There are no changes in the 2023 tax rates of Northwest Territories. This has maintained the position of the territory among the jurisdictions with the lowest tax rates in Canada.
Concluding Thoughts
No doubt, the Canadian tax system is complex, with different rates and brackets at both the federal and provincial levels.
However, knowing which bracket you fall into and the corresponding tax rate can help you plan your finances and make informed decisions, reduce your tax liabilities, and maximize your tax benefits.
Bear in mind that the federal and provincial tax brackets and rates are subject to change each year.
As such, you need to stay up-to-date with the latest changes to ensure you are compliant with the law and maximizing your tax benefits.
Finally, seeking advice from a professional tax advisor or accountant can also be beneficial in navigating the complexities of the tax system and making the most of your financial situation.
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