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Year-end tax planner – 2025: Helping individuals and owner-managed businesses save tax
October 27, 2025
The Year-end tax planner is designed primarily for individuals who have accumulated some wealth or own their own businesses (large or small). It includes nine year‑end tax planning checklists and several tables of useful information.
What's new?
Personal income tax rates – lowest rate decreasing from 15% to 14.5% for 2025 and to 14% for 2026.
Capital gains inclusion rate – will remain at ½ (the proposed increase to ⅔ will no longer proceed).
Accelerated first year capital cost allowance (CCA) deductions – enhanced first-year CCA deduction proposed for eligible property that is acquired and becomes available for use after 2024 and before 2034, including a 100% CCA deduction for eligible manufacturing and processing (M&P) and specified clean energy equipment and zero-emission vehicles acquired and available for use before 2030.
Scientific research and experimental development (SR&ED) – SR&ED tax incentive program significantly enhanced for taxation years beginning, and property acquired, after December 15, 2024.
Voluntary disclosures program (VDP) – revised and improved for VDP applications made after September 30, 2025.
Canada Revenue Agency (CRA) online mail – CRA switched to online mail for most business communications.
Trade tariffs and government support – in response to various US tariffs imposed on Canadian imports to the United States, the Canadian government has imposed surtaxes on certain US-origin steel and aluminum goods and fully assembled vehicles imported into Canada, and are providing government support to certain Canadian business sectors.
Corporate income tax rates
- Nova Scotia – small business rate decreased from 2.5% to 1.5% and small business threshold increased from $500,000 to $700,000 on April 1, 2025.
- Prince Edward Island – general corporate rate decreased from 16% to 15% and small business threshold increased from $500,000 to $600,000 on July 1, 2025.
Personal income tax rates
- Alberta – new $60,000 tax bracket (with 8% rate), starting 2025.
- Manitoba – starting 2025, basic personal amount is phased out for individuals with income exceeding $200,000.
- Nova Scotia – non-eligible dividend rates increased in 2025.
- Prince Edward Island – income tax rates changed in 2025.
Nova Scotia HST rate – decreased from 15% to 14% on April 1, 2025.
Online mail – Alberta Tax and Revenue Administration and Revenu Québec transitioning to online mail for most business communications.
Ontario made manufacturing ITC – rate and eligibility temporarily enhanced for property acquired and available for use after May 14, 2025.
Quebec SR&ED – SR&ED tax credits are consolidated into one new tax credit for R&D, innovation and pre-commercialization.
Year-end tax planning checklists
Working with your PwC adviser is essential when considering the following year-end tax planning tactics. In addition to tax considerations, your financial plan should reflect investment philosophies, sound business practices and motivational goals. Owner-managers should ensure that sufficient funds are retained to meet business objectives; given the uncertainty in the economic environment, cash flow management is especially important.
On November 4, 2025, the federal government will release its 2025 budget. Please refer to our 2025 federal budget Tax Insights, which will be available at www.pwc.com/ca/budget, for details of new tax initiatives that may be relevant for you or your business.
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