Executive Summary
The past week did not bring major new federal or Ontario tax legislation. However, several new-year tax changes and administrative resets are now in effect and are relevant for individuals, employers, and corporations as we move further into 2026.
This update focuses on what has changed automatically, what remains unchanged, and what taxpayers should be reviewing now.
Federal Tax Updates
1. Federal Personal Tax Brackets & Credits (Indexation)
As of January 1, 2026, federal personal income tax brackets and non-refundable credits have been inflation-indexed, including the Basic Personal Amount (BPA).
What this means:
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Slightly lower federal tax payable for many taxpayers
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Payroll withholding should already reflect updated tables
Who’s affected:
All individual taxpayers and employers running payroll.
Action:
Employers should confirm payroll systems are using 2026 CRA tables. Individuals should expect small changes to net pay.
2. Registered Plan Annual Limits Reset
Annual limits for registered plans are now effective for 2026:
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TFSA annual limit: $7,000
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RRSP dollar limit: $33,810 (actual room depends on Notice of Assessment)
Who’s affected:
Individuals saving through TFSAs and RRSPs; owner-managers using salary strategies.
Action:
Confirm contribution room before funding to avoid penalties.
Ontario Tax Updates
3. Ontario Personal Tax Credits (Indexation)
Ontario personal tax credits, including the Ontario basic personal amount, have been indexed for 2026.
What changed:
Only annual indexation — no new Ontario tax rates or credits were introduced this week.
Who’s affected:
Ontario residents and Ontario employers.
Action:
Ensure payroll and personal tax planning assumptions reflect updated Ontario credits.
Tax Court of Canada
No major Tax Court of Canada decisions with broad application were released this week.
Changes Since Last Brief
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✔ New-year indexation now in effect
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✔ TFSA and RRSP limits reset
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❌ No new federal or Ontario tax legislation
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❌ No new CRA administrative bulletins impacting filings this week
Advisor Takeaways
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January is the best time to fix payroll settings and CRA account access
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Confirm registered plan contribution strategies early
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Quiet legislative weeks are normal early in the year — preparation now prevents issues later
Need quick tax answers?
Try our AsraniCPA Virtual Tax Assistant — available 24/7 for CRA questions, T1/T2 filing, HST, payroll and more.
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