2026 Key Canadian Tax Numbers: What to Know and Why They Matter

Yay! It’s a new year!

Every time the calendar flips over, a whole bunch of key numbers change when it comes to taxes and benefits. Thresholds increase with inflation indexing, and ongoing pension enhancements. While these changes are incremental, they have a meaningful impact on your cash flow, including salaries you might pay yourself, or how much you might draw from your investments, pensions, and much more.

Let’s take a walk through the key Canadian tax numbers for 2026 and what they mean for your financial plan.

Canada Pension Plan (CPP): Higher Contributions, Higher Future Benefits

The Canada Pension Plan continues its multi-year enhancement, which means both contributions and future benefits are higher than in the past.

• Year’s Maximum Pensionable Earnings (YMPE): $74,600
• Year’s Additional Maximum Pensionable Earnings (YAMPE): $85,000
• CPP contribution rate: 5.95% (employee and employer) up to the YMPE
  • Maximum Contribution: $4,230 annually (each)
• Self-employed rate: 11.9% up to the YMPE
  • Maximum Contribution: $8,460
• CPP Additional contribution rate: 4% (employee and employer) for earnings between the YMPE and YAMPE
  • Maximum Contribution: $416 annually (each)
• Self-employed additional rate: 8%
  • Maximum Contribution: $832

Why this matters:
If you set your own salary and want to make sure you’re contributing as much as you can to the CPP, you’ll want to use that YAMPE threshold, plus $3,500. Why plus $3,500? Because the first $3,500 gets paid to you without any CPP contributions.

If you’re self-employed, remember that you do contribute the self-employed amount as part of your income tax remittances. It all goes to the same place, so you may not realize that you are paying it – but you are. This way, you know exactly how much.

Remember that these contributions increase your future CPP income, which remains one of the best nationally managed pensions in the world. We like the CPP. It’s forced savings, and not only provides a guaranteed retirement income, but also has disability benefits and survivor benefits.

Old Age Security (OAS): Inflation Adjustments and Clawback Thresholds

Old Age Security payments are indexed quarterly to inflation and continue to reflect the enhanced benefit for seniors aged 75 and older. For the first quarter of 2026 (January through March), the maximum monthly payments are:

• Ages 65–74: $742.31 per month
• Ages 75+: $816.54 per month

Note: If you defer your OAS start date past age 65, your OAS pension amount increases by 0.6% each month (7.2% each year) that you defer beyond age 65. The maximum deferral is to age 70, with a 36% deferral increase.

OAS Clawback (Recovery Tax)

OAS is income-tested. Once net income exceeds the clawback threshold, benefits are reduced at a rate of 15% of the excess. If you defer your OAS pension the maximum threshold noted below will increase at the same rate as your deferral increase.

Between January 2026 and June 2026, your clawback is based on your 2024 income tax return.

If your individual income (not combined with your spouse) was over $90,997 in 2024, your OAS income will be reduced by 15 cents for every $1 over the threshold.

For those age 65 to 74 who are eligible for the maximum benefit, your OAS will be completely clawed back with individual 2024 income of $148,451.

For those age 75 and better who are eligible for the maximum benefit, your OAS will be completely clawed back with individual 2024 income of $154,196.

Between July 2026 and June 2027, your clawback is based on your 2025 income tax return.

If your individual income (not combined with your spouse) was over $93,454 in 2025, your OAS income will be reduced by 15 cents for every $1 over the threshold.

For those age 65 to 74 who are eligible for the maximum benefit, your OAS will be completely clawed back with individual 2025 income of $152,062.

For those age 75 and better who are eligible for the maximum benefit, your OAS will be completely clawed back with individual 2025 income of $157,923.

Why this matters:
Strategic income planning, such as pension splitting, RRSP/RRIF drawdown timing, and use of TFSAs, can help reduce or avoid OAS clawbacks over time.

RRSP Contribution Room

You earn RRSP contribution room each year that you have “earned income” (salary, wages, rental), at a rate of 18% of that income, up to an annual maximum. In 2026, that annual maximum is $33,810. You will need to have had earned income of at least $187,833 in 2025 to earn the maximum contribution room for 2026.

If you are planning your salary for 2027, the maximum RRSP contribution room will be $35,390. This means you will need a salary of at least $196,611.11 in 2026 to earn that maximum.

If you are setting your own salary, and want to be able to earn the maximum RRSP contribution room, you’ll want to have had salary of at least $187,833 in 2025 to earn that 2026 maximum.

Remember, your RRSP contribution limit for each year is a combination of past, unused RRSP room, and the room you earned in the previous tax year. You’ll find your 2026 RRSP contribution limit on your CRA Notice of Assessment when you file your 2025 income taxes.

TFSA Contribution Room

Each year, every adult Canadian resident earns the same amount of TFSA contribution room. The annual contribution amount is set each year by the Federal Government. For 2026, the annual contribution limit is the same as it was in 2025: $7,000.

Unused contribution room carries forward to be used in future years. If you were an adult when the account was created in 2009, and you have not made any contributions, you will have $109,000 of contribution room in 2026.

Note that if you make a withdrawal from your TFSA, the amount you withdraw is added to your contribution room in the calendar year following that withdrawal. Do not try to recontribute it in the same calendar year. Over-contributions are a problem and come with a penalty fee of 1% of the over-contribution amount.

We have had issues with getting good reporting from CRA on your current TFSA contribution room. Even when it is finally reported – it took several months last year – they don’t guarantee that it’s correct. It is worthwhile to keep a ledger of your contributions and withdrawals so that you have clarity about your contribution room, even if the CRA does not.

FHSA Contribution Room

The FHSA (first home savings account) is a relatively new account created for first-time home buyers. Your contributions to this account are tax-deductible. The growth in this account is tax-deferred until withdrawal. If you make a withdrawal for the purpose of buying a qualifying first home, then the withdrawal is entirely tax free.

You have to open an FHSA with your financial institution in order to start earning contribution room. You earn $8,000 of room each year, up to the lifetime maximum of $40,000. You can learn more about FHSAs here.

RDSP Grants and Bonds

If you are approved for the Disability Tax Credit – and many people who don’t consider themselves “disabled” could be approved – that means you can open an RDSP (Registered Disability Savings Plan). This is a tax-advantaged retirement savings account that also comes with matching grants and bonds. The grants and bonds are income tested, based on tax returns from 2 years ago. Therefore, your 2026 grant and bond qualification is based on your 2024 tax return.

What This Means for Your 2026 Planning

Please take this as a reminder to make your TFSA, RESP, and RDSP contributions for the year, or to reset your monthly contributions if necessary.

If you set your own salary income, remember to update what you pay yourself in accordance with your plan, which may be linked to CPP and RRSP maximums.

While this is a very number-y update, financial planning isn’t about reacting to individual thresholds, but about understanding how the system works for you. Taking the time to refresh yourself on what your goals are for this year is a great way to keep your plan in good working condition.

If you read through this and think to yourself, that definitely means something to me but I’m not sure what, that’s okay. You have other things to remember, and we’re happy to remember that piece for you.

Your Spring Planning Team

Practice Notes:

The More Things Change… The More They Stay the Same

Happy New Year!

Thank you for being with us, and giving us the opportunity to do the work we love, every single day, with people we really enjoy. As we look out to the year ahead, we are focused on continuing to improve our services to you, so we can remain beside you through every twist and turn.

As you may have noticed, we have been fortunate enough to experience growing demand. We’ve been adjusting the way we manage and work, while doing our best to determine if this growth would be long-term, or if it might be a short-term event.

We are now confident it’s nothing short-term.

We spent some time considering what we would need to do, and what we would need to have in place, to continue to serve you well for the long term. We kept coming back to a simple question: how have your needs continued to evolve, and how can we continue showing up for you at the highest level?

The work we are lucky enough to do with you has become deeper, more interconnected, and often higher stakes than ever before. In our conversations with you, themes have emerged that have helped us determine our next steps. You want greater sophistication, access to the best ideas and thinking available, and broader perspective. You want to continue to rely on independent, unbiased advice, and thoughtful judgement. Meeting those needs would require more than incremental improvements. It would require strengthening the foundation behind the work we do together.

Over the years, we’ve been approached by multiple accounting and investing firms with offers to join their teams. We turned all of them down. In 2024, we were approached by a company called Prime Quadrant. We were pretty sure we were going to turn them down too – but we took the time to get to know them.

We learned that Prime Quadrant is not a traditional financial services firm, but instead a purpose-built multi-family office acting as an independent nerve centre for complex families, helping coordinate insight, governance, and decision-making. Their flat-fee based business model aligns with our own, removing pressure and incentives that could potentially shape advice. Headquartered in Toronto, with offices in Montreal, Vancouver, New York, and Miami, Prime Quadrant works with families across North America. Many of those families are deeply connected as a community, sharing experiences across private business, philanthropy, governance, and multigenerational decision making.

After many discussions, we have decided to kick off 2026 by partnering with Prime Quadrant to build a stronger foundation for you, without sacrificing the quality of the work we do with you, while preserving our independence, and giving us – and you – access to a broader set of capabilities to thoughtfully enhance the work we do together.

Spring Planning will continue to be Spring Planning. With Prime Quadrant’s support, we are expanding our team and investing in systems and technology that strengthen how we support you behind the scenes, while keeping our work together personal, thoughtful, and human.

With our support, Prime Quadrant will increase the cohesiveness of their services. Julia’s been given the title of Chief Transformation Officer and the responsibility to champion and empower families with human-centric, holistic planning and education, for families across generations.

This partnership gives us something we care about very deeply: continuity. This helps ensure that the work we do together can continue smoothly over time, as your lives and the lives of the individual team members at Spring evolve. That kind of resilience is something we often help you build for yourselves, and it feels important to build it for Spring as well, so we can continue to be there for you.

KEY QUESTIONS AND ANSWERS:

Will Spring Planning clients receive the same services?

Yes. Nothing changes. Well, the plan is that things get better, and we will improve the ways we support you. But we’re not going to stop planning. We will still bother you about your Action List and harass you to book an annual meeting. We will still work closely with your advisory team and will continue to respect all of your advisory relationships. We really like the people you work with, or else we would have said something earlier.

Will Spring Planning start shilling products and investments?

No. Our conflict-avoidance program remains the same. We don’t make money on referrals, and we don’t make money on products. The fact that Prime Quadrant provides consulting services and is agnostic about what investment manager their clients work with or what investments clients choose is really important to us. Many of our clients already work with fantastic investment managers, while others manage their own investments, and we’re not interested in upsetting anyone’s apple carts. Plus, Prime Quadrant actually works with a number of the investment managers we work with already. Canada is a small town; we do all seem to know each other and generally work well together.

Do we have to use Prime Quadrant’s suite of services to work with the Spring team?

No.

Will the team move to Toronto?

No. We hear they have proper winter there and we don’t think we’d do well under those conditions. But we do expect Julia will visit Toronto a lot more frequently. Hopefully when it’s not too cold.

What is the Spring team excited about with this partnership?

We really like that we will be able to use the resources of the Prime Quadrant team to support all the backstage, running-the-business stuff that does take up time and effort. That’s going to free up a great deal more time to focus on the work we do with you.

We like that we will have team members who have expertise in areas we don’t, so we can bug them when we have a question about a particular strategy our clients are considering, or we find out that there’s an interesting and different way to achieve something you want to do. We have lots of good friends across multiple industries who we will still harass about all of those things of course. This just adds about 100 more people into our network. These ones can’t escape us, either.

We like that we might be able to fully unplug on holidays, knowing that we will have systems and support in place to take care of everything.

We also like that we get to dig into working more internationally, and that we get to develop empowering (not boring) education to help our clients of all ages, stages, and backgrounds develop the confidence and skills to achieve the lives they want.

We especially like that this will give us the opportunity to have a greater impact on more people, both in the industry and outside of it, to provide a blueprint for what great financial planning looks and feels like. We hope that this blueprint will make it easier for more financial planners to build human-centric businesses that are effective and sustainable.

We could have taken some offers that were about chunks of money and not really about changing anything. Instead, we chose to take on heavier and deeper work, with the support we need, so that we can do what we really want: help more people build the lives they want.

Plus, if we don’t like it, we can always leave. But we are pretty sure we’re going to like it, or else we wouldn’t be putting all this work in to build it. We hope you will too.

Have more questions? Drop us a note at info@springplans.ca.

Spring in the News:

Many seniors want to age in place, but few are prepared for the financial and emotional costs. Julia spoke with the Globe & Mail about how best broach the subject before a crisis hits. Read the full article here.

Please check out our media page here for videos, podcasts, interviews and more.

Planning News Digest:

Our friend Tara Landes of Bellrock recently wrote a thoughtful article exploring how what often look like time-management challenges are actually access-management issues. She examines how poor access management affects not only your own effectiveness, but also the performance of your strongest team members. Read the full article to learn how to rethink and rebuild your access management approach.

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