Principal Changes for 2026
The calculation changes for source deductions and contributions for 2026 relating to tax changes announced before November 26, 2025, are listed below. For information about tax changes announced after November 25, 2025, read the Tax News articles published after that date.
Indexation
The personal income tax system is indexed at 2.05% for 2026.
Taxable income thresholds and income tax rates
The taxable income thresholds have been indexed; however, the income tax rates remain unchanged for 2026. The rates are:
- 14% for taxable income up to $54,345
- 19% for taxable income over $54,345 but not more than $108,680
- 24% for taxable income over $108,680 but not more than $132,245
- 25.75% for taxable income over $132,245
Personal tax credit amounts
The personal tax credit amounts on the Source Deductions Return (TP 1015.3-V) are indexed for 2026.
| Basic personal amount | $18,952 |
| Amount transferred from one spouse to the other | $18,952 |
| Amount for other dependants | $5,684 |
| Amount for a child under 18 enrolled in post-secondary studies (per term) | $3,901 |
| Additional amount for a person living alone (single-parent family) | $2,681 |
| Amount for a severe and prolonged impairment in mental or physical functions | $4,208 |
| Amount for a person living alone | $2,172 |
| Age amount | $3,986 |
| Amount for retirement income | $3,541 |
| Reduction threshold for the age amount, the amount for a person living alone and the amount for retirement income | $42,955 |
| Exclusion threshold for eligible work income for calculating the amount for career extension | $7,655 |
| Maximum amount of eligible work income for calculating the amount for career extension | $12,755 |
| Reduction threshold for the amount for career extension | $57,660 |
Amount for career extension
As of the 2026 taxation year, the following amounts on form TP-1015.3-V in respect of the amount for career extension will be indexed annually:
- the exclusion threshold for eligible work income
- the maximum eligible work income
- the reduction threshold
Gratuities and retroactive pay
The threshold for determining the method to be used to calculate the source deduction of income tax on gratuities and retroactive pay is $18,952 for 2026.
Deduction for workers
The maximum deduction for workers is $1,450 for 2026.
Emergency services volunteer
The maximum exemption that can be granted to an individual as an emergency services volunteer is $1,450 for 2026.
Disability assistance payments from a registered disability savings plan (RDSP)
For 2026, you must withhold income tax at a rate of 14% from the taxable portion of a disability assistance payment from an RDSP that exceeds $23,160.
Elimination of deductions for certain foreign individuals and for sailors engaged in international freight transportation
The following deductions have been eliminated:
- the deduction for foreign researchers
- the deduction for foreign experts
- the deduction for foreign specialists assigned to operations in an international financial centre
- the deduction for foreign specialists working in the financial services sector
- the deduction for sailors engaged in international freight transportation
As a result, issuing bodies will not accept applications for researcher, expert or specialist certificates and qualification certificates, seaman certificates or vessel certificates after March 25, 2025.
The elimination of these deductions does not impact the eligibility of employees for whom an eligible employer holds a researcher, expert or specialist certificate or qualification certificate (or for whom an application for such a certificate was filed by March 25, 2025). These employees will be able to claim the deduction under the current rules. See Reducing the Remuneration Subject to Source Deductions of Income Tax and Foreign Employees Entitled to a Five-Year Tax Exemption.
The deduction for employment income earned on a vessel cannot be claimed for 2026 and subsequent years.
Cooperative investment plan deduction
The rate of the cooperative investment plan (CIP) deduction has decreased to 100% (from 125%) for qualifying securities acquired after March 25, 2025. The 30% of total income rule continues to apply to the deduction. See Cooperative Investment Plan (CIP) Deduction.
Québec Pension Plan (QPP) contributions
The table below provides the QPP data for 2026.
| Maximum pensionable earnings | $74,600 |
| Basic exemption | $3,500 |
| Maximum contributory earnings | $71,100 |
| Contribution rate (base contribution rate of 5.30% and first additional contribution rate of 1%) | 6.30% |
| Employee's maximum contribution | $4,479.30 |
| Employer's maximum contribution (per employee) | $4,479.30 |
| Additional maximum pensionable earnings | $85,000 |
| Maximum pensionable earnings | $74,600 |
| Additional maximum contributory earnings | $10,400 |
| Second additional contribution rate | 4% |
| Employee's maximum second additional contribution | $416 |
| Employer's maximum second additional contribution (per employee) | $416 |
Québec parental insurance plan (QPIP) premiums
The table below provides the QPIP data for 2026.
| Maximum insurable earnings | $103,000 |
| Employee's premium rate | 0.430% |
| Employee's maximum premium ($103,000 × 0.00430) | $442.90 |
| Employer's premium rate | 0.602% |
| Employer's maximum premium (per employee) ($103,000 × 0.00602) | $620.06 |
Contribution to the health services fund
The table below shows the health services fund contribution rates for 2026, by total payroll.
For 2026 and subsequent years, the total payroll threshold for eligibility for a reduction of the health services fund contribution rate remains $7.8 million.
| Total payroll | Rates for all employers, other than employers in the primary and manufacturing sectors and public sector employers | Rates for employers in the primary and manufacturing sectors | Rate for public sector employers |
|---|---|---|---|
| $1,000,000 or less | 1.65 | 1.25 | 4.26 |
| $1,000,001 to $7,799,999 | 1.2662 + (0.3838 × total payroll ÷ 1,000,000) | 0.8074 + (0.4426 × total payroll ÷ 1,000,000) | 4.26 |
| $7,800,000 or more | 4.26 | 4.26 | 4.26 |
Temporary exemption from health services fund contributions for businesses in the agricultural, forestry and fishing sectors
On January 28, 2026, the Minister of Finance of Québec announced that the rules governing the temporary exemption from health services fund contributions for businesses in the agricultural, forestry and fishing sectors would be broadened. The contribution holiday was first introduced as part of the economic and financial update published on November 25, 2025.
For more information, see the Tax News article entitled Broadening of the Temporary Exemption From Health Services Fund Contributions for the Agriculture, Forestry and Fishing Sectors.
Contribution related to labour standards
For 2026, the maximum remuneration subject to the contribution related to labour standards is $103,000.
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