Marginal Tax Rate in New Brunswick 2025 and 2026
The marginal tax rate in New Brunswick is the rate of tax you pay on each additional dollar of income you earn. It's not the average rate you pay on your entire income; rather, it's the rate applied to the next dollar you earn. New Brunswick, like the federal government, employs a progressive tax system, meaning the marginal tax rate increases as your income rises through different tax brackets.
New Brunswick Tax Brackets and Rates: 2026 vs. 2025
New Brunswick's tax system, similar to the federal system, uses tax brackets to determine the applicable tax rates. Each bracket represents a range of income, and each range is taxed at a specific rate. These brackets, along with personal tax credit amounts, are adjusted annually for inflation. For 2025, New Brunswick uses an indexation factor of 1.027 (a 2.7% increase), mirroring the federal indexation factor.
2025 New Brunswick Tax Brackets and Rates
The following table outlines the New Brunswick provincial tax brackets and rates for the 2025 tax year:
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| Taxable Income | Tax Rate |
|---|---|
| First $51,306 | 9.4% |
| Over $51,306 up to $102,614 | 14.0% |
| Over $102,614 up to $190,060 | 16.0% |
| Over $190,060 | 19.5% |
2026 New Brunswick Tax Brackets and Rates
For comparison, here are the tax brackets and rates for the 2026 tax year:
| Taxable Income | Tax Rate |
|---|---|
| First $49,958 | 9.4% |
| Over $49,958 up to $99,916 | 14.0% |
| Over $99,916 up to $185,064 | 16.0% |
| Over $185,064 | 19.5% |
As you can see, the income thresholds for each bracket increased in 2025 due to indexation.
Combined Federal and New Brunswick Marginal Tax Rates
It's crucial to remember that you pay both federal and provincial income taxes. Therefore, your overall marginal tax rate is the combined federal and New Brunswick rate. This combined rate differs depending on the type of income you earn: regular income, capital gains, and eligible or non-eligible Canadian dividends.
2025 Combined Marginal Tax Rates
| Taxable Income | Other Income | Capital Gains | Eligible Dividends | Non-Eligible Dividends |
|---|---|---|---|---|
| First $51,306 | 24.40% | 12.20% | -6.38% | 14.51% |
| Over $51,306 up to $57,375 | 29.00% | 14.50% | -0.03% | 19.80% |
| Over $57,375 up to $102,614 | 34.50% | 17.25% | 7.56% | 26.13% |
| Over $102,614 up to $114,750 | 36.50% | 18.25% | 10.32% | 28.43% |
| Over $114,750 up to $177,882 | 42.00% | 21.00% | 17.91% | 34.75% |
| Over $177,882 up to $190,060 | 45.32% | 22.66% | 22.49% | 38.57% |
| Over $190,060 up to $253,414 | 48.82% | 24.41% | 27.32% | 42.60% |
| Over $253,414 | 52.50% | 26.25% | 32.40% | 46.83% |
Note that the marginal tax rate for dividends is a percentage of the actual dividends received, not the grossed-up taxable amount. The marginal tax rate for capital gains is a percentage of total capital gains, not taxable capital gains.
2026 Combined Marginal Tax Rates
| Taxable Income | Other Income | Capital Gains | Eligible Dividends | Non-Eligible Dividends |
|---|---|---|---|---|
| First $49,958 | 24.40% | 12.20% | -6.38% | 14.51% |
| Over $49,958 up to $55,867 | 29.00% | 14.50% | -0.03% | 19.80% |
| Over $55,867 up to $99,916 | 34.50% | 17.25% | 7.56% | 26.13% |
| Over $99,916 up to $111,733 | 36.50% | 18.25% | 10.32% | 28.43% |
| Over $111,733 up to $173,205 | 42.00% | 21.00% | 17.91% | 34.75% |
| Over $173,205 up to $185,064 | 45.32% | 22.66% | 22.49% | 38.57% |
| Over $185,064 up to $246,752 | 48.82% | 24.41% | 27.32% | 42.60% |
| Over $246,752 | 52.50% | 26.25% | 32.40% | 46.83% |
Impact of the Basic Personal Amount
The Basic Personal Amount (BPA) is a non-refundable tax credit that every individual can claim. It effectively reduces the amount of income subject to tax. Both the federal and provincial governments offer a BPA.
New Brunswick Basic Personal Amount
For 2025, the New Brunswick Basic Personal Amount is $13,396, taxed at a rate of 9.40%. For 2026, it was $13,044, also taxed at 9.40%.
Federal Basic Personal Amount
The Federal Basic Personal Amount has a minimum and maximum for 2025: $14,538 and $16,129, respectively, both taxed at 15%. For 2026 the amounts were $14,156 and $15,705. It's important to note there is an enhanced federal personal amount which affects the marginal tax rates in higher income brackets.
Capital Gains Taxation in New Brunswick
Capital gains, which arise from the sale of assets like stocks or real estate, are taxed differently than regular income. In New Brunswick, only 50% of your capital gains are included in your taxable income. This is known as the capital gains inclusion rate. Your marginal tax rate on capital gains is therefore half of your marginal tax rate on other income, as illustrated in the combined marginal tax rate tables above.
Frequently Asked Questions (FAQs)
What is New Brunswick's marginal tax rate?
New Brunswick's marginal tax rate varies depending on your income level and the type of income. For regular income in 2025, the provincial marginal rates range from 9.4% to 19.5%. However, you must also consider the federal marginal tax rates, resulting in combined rates ranging from 24.40% to 52.50% for other income. See the tables above for detailed breakdowns by income type and bracket.
How is tax deducted from a paycheque in New Brunswick?
Your employer deducts income tax, Canada Pension Plan (CPP) contributions, and Employment Insurance (EI) premiums from your paycheque based on your estimated annual income and applicable federal and provincial tax laws. The amount of tax deducted considers your claimed tax credits and deductions.
How long does it take to get a tax refund in Canada?
The Canada Revenue Agency (CRA) typically processes electronically filed tax returns within two weeks. Paper returns may take up to eight weeks. You can check the status of your refund online using the CRA's My Account service.
When are taxes due in Canada?
For most individuals, taxes are due on April 30th of each year. If you are self-employed, you have until June 15th to file your return, but your payment is still due on April 30th.
How do I pay income taxes online?
You can pay your income taxes online through your financial institution's online banking service, through the CRA's My Payment service, or by using a third-party service provider.
Does everyone need to file an income tax return?
You generally need to file a tax return if you owe taxes, want to claim a refund, or are eligible for certain government benefits. Even if you don't owe taxes, it's often beneficial to file to receive benefits like the GST/HST credit or the Canada Child Benefit.
How long should I keep my income tax records?
The CRA recommends keeping your income tax records, including supporting documents, for at least six years from the end of the tax year to which they relate.
What are New Brunswick’s most popular tax credits and deductions?
New Brunswick offer a variety of tax credits. Some examples include: Basic Personal Amount, Age Amount, Spouse or Common-Law Partner Amount, and many more.
Is there a carbon tax rebate in New Brunswick?
Yes, there is a carbon tax system, and rebates in New Brunswick. Check official Governamental websites for more accurate and updated information.
Conclusion
Understanding the marginal tax rate system in New Brunswick is essential for informed financial planning. Remember that the rates and brackets change annually due to indexation, and it's the combined federal and provincial rates that ultimately determine your tax liability on each additional dollar of income. By familiarizing yourself with these concepts and utilizing available resources like the detailed tax calculators at truenorthtaxes, you can better manage your tax obligations.
What other questions do you have about New Brunswick's tax system?
If you want to know other articles similar to Marginal Tax Rate in New Brunswick 2025 and 2026y ou can visit the category Marginal Tax Rate & Tax Brackets Canada 2025 - 2024.
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