What is the federal basic personal amount for 2026, and where does it start to phase out?
For 2026, the federal basic personal amount is $16,452, up from $16,129 in 2025, for net income up to $181,440. It shrinks to $14,829 once net income reaches $258,482. The credit uses the 14% lowest federal rate, so the full amount saves $2,303.28 of federal tax and the minimum saves $2,076.06.
The 2026 figures next to 2025
Indexation for 2026 is 2.0%, so the maximum rose $323 to $16,452 and the minimum rose to $14,829 canada.ca. The lowest federal rate dropped to 14% for the full year, the rate the credit is calculated at
canada.ca.
| Figure | 2026 | 2025 |
|---|---|---|
| Maximum basic personal amount | $16,452 | $16,129 |
| Minimum basic personal amount | $14,829 | $14,538 |
| Enhanced portion that phases out | $1,623 | $1,591 |
| Phase out starts (net income) | $181,440 | $177,882 |
| Phase out ends (net income) | $258,482 | $253,414 |
| Lowest federal rate | 14% | 14.5% |
| Credit at the maximum | $2,303.28 | $2,338.71 |
| Credit at the minimum | $2,076.06 | $2,108.01 |
| Indexation factor | 2.0% | 2.7% |
The 2025 rate is a blend. The federal rate fell from 15% to 14% on July 1, 2025, which the CRA treats as 14.5% for the 2025 year canada.ca. That's why the 2026 credit is worth $35.43 less than 2025 even though the amount went up: $16,452 at 14% is $2,303.28, while $16,129 at 14.5% was $2,338.71.
How the phase out works
The amount has two parts. The base, $14,829 for 2026, is available to everyone. The enhanced portion, $1,623, is reduced in a straight line as net income moves from the start of the 29% bracket to the start of the 33% bracket. The statutory formula is in subsection 118(1.1) of the Income Tax Act, and paragraph 118(1)(c) gives the credit to an individual without a spouse or dependant claim laws-lois.justice.gc.ca.
The CRA writes the 2026 version as three cases in its payroll formulas guide canada.ca:
| Net income (NI) | Basic personal amount |
|---|---|
| $181,440 or less | $16,452 |
| Above $181,440 and below $258,482 | $16,452 minus (NI minus $181,440) times $1,623 / $77,042 |
| $258,482 or more | $14,829 |
The $77,042 is the width of the band. Each dollar of net income inside it cuts the amount by about 2.1 cents, which costs your client about 0.3 cents of extra federal tax on top of the 29% bracket rate. The test is net income for the year, line 23600, not taxable income, so an RRSP deduction that lowers line 23600 also restores part of the amount.
Worked example: net income of $220,000
Take a client with 2026 net income of $220,000. Run the middle case of the formula.
| Step | Arithmetic | Result |
|---|---|---|
| Income above the start of the band | $220,000 minus $181,440 | $38,560 |
| Reduction | $38,560 times $1,623 / $77,042 | $812.32 |
| Basic personal amount | $16,452 minus $812.32 | $15,639.68 |
| Federal credit at 14% | $15,639.68 times 14% | $2,189.56 |
Against a client under $181,440, this one loses $812.32 of amount and $113.72 of federal tax savings. At $258,482 and above the loss is the full $1,623, or $227.22 of tax.
Provincial and territorial amounts for 2026
Each province sets its own amount and claws it back (or not) on its own rules. These are the 2026 figures in the CRA payroll formulas, January edition updated by the July edition canada.ca.
| Jurisdiction | 2026 basic personal amount | Note |
|---|---|---|
| Alberta | $22,769 | Flat |
| British Columbia | $13,216 | Flat |
| Manitoba | $15,780 | Reduced to nil as net income goes from $200,000 to $400,000 |
| New Brunswick | $13,664 | Flat |
| Newfoundland and Labrador | $13,094 | Raised from $11,188, effective January 1, 2026 |
| Northwest Territories | $18,198 | Flat |
| Nova Scotia | $11,932 | Flat |
| Nunavut | $19,659 | Flat |
| Ontario | $12,989 | Flat |
| Prince Edward Island | $15,000 | Up from $14,650 |
| Saskatchewan | $20,381 | Flat |
| Yukon | $16,452 to $14,829 | Mirrors the federal formula |
Manitoba's phase out and Yukon's federal mirror come from the January edition canada.ca. Quebec isn't in the CRA tables because Revenu Québec sets the Quebec amount.
What it means for TD1 forms and payroll
Line 1 of the 2026 federal TD1 is $16,452 for every resident of Canada canada.ca. An employee who expects net income above $181,440 and claims the full $16,452 may owe tax at filing. They can work out a partial claim on Form TD1-WS, the worksheet for the 2026 return, and enter that instead
canada.ca.
If an employee doesn't fill out a TD1 at all, payroll uses only the basic personal amount, estimated by you from the income you pay them. In the CRA formulas that estimate runs through the same three case calculation, so a high salary already gets a reduced federal amount on payroll.
The provincial forms are on the CRA's 2026 TD1 page canada.ca. Newfoundland and Labrador is the 2026 trap. Its increase to $13,094 came partway through the year, so from the first July payroll the CRA formulas use a prorated $15,000 for the remaining six months, and you don't need a new TD1NL from an employee who filed one before July 1, 2026
canada.ca. Payroll software updated for July picks this up; a hand calculation from the January tables won't.
The basic personal amount only changes income tax withholding. The 2026 CPP maximums and the 2026 EI maximums are separate calculations on the same pay.
Sources
Do the spouse and eligible dependant amounts phase out the same way?
Yes. For 2026 the maximum spouse or common law partner amount and the maximum eligible dependant amount are $16,452 when your client's net income is $181,440 or less and $14,829 at $258,482 or more, based on your client's income, not the dependant's canada.ca.
Can an employee with two jobs claim the basic personal amount on both TD1 forms?
No. Once an employee has claimed the personal amounts on one employer's TD1, they can't claim them again on a second TD1 for a job held at the same time canada.ca. The second employer withholds without the credit.
Does a nonresident employee get the basic personal amount on payroll?
Only if 90% or more of their world income will be included in their Canadian taxable income. If not, the 2026 TD1 tells them to enter 0 on line 13 and skip lines 2 to 12 canada.ca.
Why is the 2026 credit smaller than the 2025 credit?
Because the rate fell faster than the amount rose. The 2025 credit used the 14.5% blended rate on $16,129 ($2,338.71), and 2026 uses 14% on $16,452 ($2,303.28) canada.ca.
General information for the tax year shown, not advice for a specific client. Confirm the facts before you file or remit.