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The corporate tax rate in Canada is 15% federally for most corporations, and 9% on the first $500,000 of active business income if you’re a Canadian-controlled private corporation. Your province or territory adds its own rate on top. A small company ends up paying 9% to 12% all in, depending on where it’s based, and a large one pays roughly 23% to 30%.
How do the federal and provincial rates add up?
Every corporation pays federal tax and provincial or territorial tax on the same taxable income. The 15% is the basic federal rate after the general tax reduction. The 9% rate is only for a Canadian-controlled private corporation (a CCPC), and only up to the small business limit.
Most provinces set two rates: a low one under the small business limit and a higher one above it. Add the federal part to the provincial part and you’ve got the combined rate. Quebec and Alberta run their own corporate tax. Alberta’s small business rate is 2% and its general rate 8% on the provincial site, and the corporate tax calculator covers both provinces.
What are the combined corporate tax rates by province in 2026?
| Province or territory | Small business combined | General combined |
|---|---|---|
| Ontario | 11.2% from 2027 | 26.5% |
| British Columbia | 11% | 27% |
| Manitoba | 9% | 27% |
| New Brunswick | 11.5% | 29% |
| Nova Scotia | 10.5% (limit $700,000) | 29% |
| Yukon | 9% | 27% |
| Northwest Territories | 11% | 26.5% |
| Nunavut | 12% | 27% |
The small business limit is $500,000 in most places. Nova Scotia uses $700,000, and Saskatchewan and Prince Edward Island use $600,000. Those last two are missing from the table because we couldn’t read the pages that confirm their rates in full.
What changed in Ontario this year?
On 1 July 2026 Ontario cut its small business rate from 3.2% to 2.2%. A company with a calendar year end pays the old rate for half the year and the new one for the rest, so its blended provincial rate comes to about 2.7%. That’s why the calculator shows 11.7% for Ontario in 2026, not 11.2%. A different year end gives a different blend.
Quebec announced a similar cut, but it only applies to years that begin after 29 April 2026, so a Quebec company on a calendar year stays at 3.2% for 2026. And Quebec wants 5,500 paid hours a year before it gives the full reduction. The calculator doesn’t model that test.
What does $600,000 of profit cost in British Columbia?
Take a CCPC there with $600,000 of active business income. The first $500,000 is taxed at 11%, which is $55,000. The last $100,000 is taxed at 27%, another $27,000. That’s $82,000 in total, an average rate of 13.7%, and $518,000 stays in the company.
Now a smaller Ontario company with $300,000 of income. The tool gives $27,000 of federal tax plus $8,088 of Ontario tax, so $35,088 in all, or 11.7%. Earn the same $100,000 in a corporation that isn’t a CCPC and Ontario takes 26.5% of it, which is $26,500.
Why your own bill can come out higher
- Associated corporations share one small business limit. Two companies under common control don’t each get $500,000.
- The limit shrinks for large taxable capital, from $10 million to $50 million.
- Passive investment income above $50,000 reduces the limit too, and it reaches nil at $150,000.
- Only CCPCs qualify for the 9% federal rate.
- Tax credits, such as those for research, aren’t included in the rates above.
- Corporate tax is only the first layer. Pay yourself salary or dividends and more tax follows, which the dividend tax calculator and the self-employed tax calculator can test.
Got staff? Payroll deduction remittances are a separate obligation, and the payroll remittance calculator shows the amounts. For sales tax on what the company sells, there’s the GST and HST calculator.
Where the numbers come from
The federal rates, the small business limit and the province examples come from the Canada Revenue Agency corporation tax rates pages and its list of what is new for corporations, read in September 2026. Alberta, Quebec and a few smaller provinces rely on their own government pages, some of which could not be confirmed in full. Combined rates in the table are the federal rate plus the provincial rate, worked out on this site. The Ontario figure for 2027 is derived from the announced cut. This site is not connected to any government, so check the current rates on the official pages or with an accountant before filing.
Frequently asked questions
What is the corporate tax rate in Canada?
The federal rate is 15% for most corporations and 9% on the first $500,000 for a CCPC. Provinces and territories add their own rate on top.
What is the small business tax rate in Ontario?
The provincial rate fell from 3.2% to 2.2% on 1 July 2026. With the 9% federal rate, the combined small business rate is 11.2% once the cut applies to a full year.
Who gets the small business rate?
Only a Canadian-controlled private corporation. The limit is $500,000 in most places and is shared with associated corporations.
Which province has the lowest corporate tax?
Manitoba and Yukon show a nil provincial small business rate, so the combined rate is 9%. Their general combined rate is 27%.
Does the calculator include tax credits?
No. It uses the rates only, and leaves out credits, capital and passive income limits, and the tax on paying the owner.
- Self-employed taxes in Canada: income, CPP and GST
How tax works when you are self-employed in Canada: reporting income and expenses, paying both halves of CPP, instalments and when to register for GST
Information only. This page is general information, not tax, legal or accounting advice. Tax-Services.ca is an independent publisher: we don't prepare or file tax returns or offer tax services, and we have no connection with the CRA, Revenu Québec, any government or any company named on this page. Check the figures that matter with an official source or a qualified professional.