What is the personal income tax base for 2025?
For the 2025 tax year, the basic amount for an individual—who doesn’t pay federal income tax—is from $14,538 to $16,129, depending on gross income.
That increases with the 2024 figure, which ranges from $14,256 to $15,705. Those on low incomes have a basic personal tax credit.
Changes to the Canada Pension Plan in 2025
Some Canadian workers will see a slight reduction in their paychecks due to the increased amount of the CPP contribution.
A multi-year pension overhaul began in 2019 as both the Quebec Pension Plan and the CPP began rolling out enhanced benefit tiers aimed at providing greater financial support to retirees. Individual contributions—and the corresponding employer share—rose as the program took effect.
From 2024, there are now two additional income ceilings above the base, where high-paid workers pay an additional premium on income in the second tier before opting out.
Earnings for first-class earners will rise to $71,300 in the new year from $68,500 in 2024. The second income ceiling will jump to $81,200 from $73,200 in 2024.
After 2025, the system will be fully implemented and the limits of the base, the first stage and the second stage will increase in line with the growth of wages rather than the large jumps seen in recent years.
Anyone who worked and contributed to CPP from 2019 onwards is eligible for a higher CPP payment at retirement to receive income from that time.
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