14% bracket ends
$60,045
$58,523 in 2026
33% bracket starts
$265,203
$258,482 in 2026
Basic personal amount
$16,880
$16,452 in 2026
Indexation
about 2.6%
2.0% for 2026
2027 figures: PayMetric Labs' own projection from Statistics Canada CPI through August 2026, not yet confirmed by the CRA. 2026 amounts from the CRA.
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Projected 2027 federal tax brackets against 2026
| Rate | 2026 taxable income | 2027 (projected) |
|---|---|---|
| 14% | Up to $58,523 | Up to $60,045 |
| 20.5% | $58,523 to $117,045 | $60,045 to $120,088 |
| 26% | $117,045 to $181,440 | $120,088 to $186,157 |
| 29% | $181,440 to $258,482 | $186,157 to $265,203 |
| 33% | Over $258,482 | Over $265,203 |
| Basic personal amount | $16,452 (min $14,829) | $16,880 (min $15,215) |
2026: CRA indexation page and CRA tax rates. The basic personal amount falls from the maximum to the minimum between the start of the 29% and 33% brackets.
How the 2027 tax brackets are set
Parliament sets the rates; inflation sets the brackets. Each year the CRA multiplies every threshold, the basic personal amount and most credits by one indexation factor and rounds to the nearest dollar. The factor is the change in average consumer prices for the 12 months to September against the 12 months before (Statistics Canada CPI).
For 2027 that means October 2025 to September 2026. With every month except September published, the factor works out at about 2.6%, up from 2.0% for 2026, because prices rose faster in 2026. Applying 2026's factor to the 2025 thresholds in the same way reproduces every 2026 figure the CRA published, so the method is sound; only September's CPI is still to come.
Indexing stops bracket creep: without it, a raise that only kept up with prices would push more of your income into higher brackets and cut your real take-home pay.
What the 2027 brackets save you in federal tax
Federal tax saved on the same taxable income in 2027 against 2026, with the basic personal amount. PayMetric Labs' own modeled estimate; other indexed credits, such as the Canada employment amount, add a few dollars more.
| Taxable income | Top federal rate | Federal tax saved |
|---|---|---|
| $40,000 | 14% | $60 |
| $60,000 | 14% | $156 |
| $80,000 | 20.5% | $159 |
| $100,000 | 20.5% | $159 |
| $150,000 | 26% | $326 |
| $200,000 | 29% | $482 |
| $300,000 | 33% | $731 |
The saving is small and grows with income, because the larger thresholds move more dollars into lower brackets. It is not a tax cut in real terms: it stops inflation from raising your tax. If your pay rises by about 2.6% in 2027, your federal tax rate on it stays roughly where it is.
When the 2027 brackets reach your paycheque
Employers switch to the CRA's 2027 payroll tables for the first pay in January, so the lower federal withholding appears without you doing anything. CPP and EI change on the same date; our CPP and EI 2027 guide has the new rates and maximums. You file the 2027 return in spring 2028.
January is also when new TFSA room opens, and RRSP contributions made by early March 2027 can still go on your 2026 return (see RRSP room and your tax refund). Provinces publish their own 2027 brackets separately, and the Ontario surtax thresholds are not indexed at all.
Canada tax brackets 2027: questions
What are the federal tax brackets for 2027 in Canada?
Projected: 14% up to $60,045, 20.5% up to $120,088, 26% up to $186,157, 29% up to $265,203 and 33% above. The rates don't change; each threshold rises by the 2027 indexation factor of about 2.6%. These are PayMetric Labs' own projections until the CRA publishes the official amounts, usually in November.
What is the basic personal amount for 2027?
Projected: $16,880 if your net income is $186,157 or less, up from $16,452. Above that it shrinks gradually to $15,215 at $265,203. At the 14% lowest rate, the full amount is worth $2,363 off your federal tax.
Is the lowest federal tax rate still 14% in 2027?
Yes. The lowest rate fell from 15% to 14% on July 1, 2025, which is why 2025 returns used a blended 14.5%. 2026 was the first full year at 14%, and 2027 stays there. Only the income thresholds move.
Will moving into a higher bracket reduce my take-home pay?
No. A higher rate applies only to the part of your income above the threshold, never to all of it. A raise that crosses into the 26% bracket is taxed at 26% only on the dollars over the line, so you always keep more of a raise than you had before it.
Why does my January 2027 paycheque look different?
Several things change on January 1 at once. Payroll moves to the 2027 brackets and basic personal amount, which cuts a little federal tax. CPP and EI rates and maximums change too, and your provincial brackets are indexed separately. If you have hit the CPP or EI maximum in late 2026, January also restarts those deductions, so a high earner's take-home can drop in January even though tax fell.
Are provincial tax brackets indexed by the same amount?
Not necessarily. Most provinces index their brackets with their own inflation measure, so the percentage differs from the federal factor, and some thresholds are fixed by law. Ontario's $150,000 and $220,000 thresholds, for example, are not indexed. Check your province's 2027 table when it is published.
Could the 2027 brackets still change?
Slightly. Eleven of the twelve months of inflation data are already published. If the final factor comes in 0.1 percentage point higher or lower, the first bracket ends at $60,103 or $59,986 instead of $60,045. The rates themselves would only change if Parliament changed them.
Methodology and limits
2026 brackets, basic personal amount and the 2.0% factor come from the CRA indexation page. 2027 amounts are PayMetric Labs' own projection: each 2026 amount times the 2027 factor, rounded to the nearest dollar, with the factor calculated from Statistics Canada CPI (table 18-10-0004-01) through August 2026, and August repeated for September until it is published. The CRA confirms the amounts in November. Checked October 13, 2026.
Tax savings compare federal tax on the same taxable income with the basic personal amount as the only credit. They leave out provincial tax, other credits and deductions. This is general information, not tax advice.