How to compute ab-individual-return for Canada, tax year 2025: rates, thresholds, and step-by-step rules with primary-source citations.
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Alberta provincial flat income tax rate
10%Alberta Personal Income Tax Act (APITA)
Federal rate — Band 1 (CAD 0–57,375)
15%Income Tax Act (Canada)
Federal rate — Band 2 (CAD 57,376–114,750)
20.5%Income Tax Act (Canada)
Federal rate — Band 3 (CAD 114,751–158,468)
26%Income Tax Act (Canada)
Federal rate — Band 4 (CAD 158,469–220,000)
29%Income Tax Act (Canada)
Federal rate — Band 5 (CAD 220,001+)
33%Income Tax Act (Canada)
Combined federal + Alberta rate — Band 1 (CAD 0–57,375)
25%Alberta Personal Income Tax Act (APITA); Income Tax Act (Canada)
Combined federal + Alberta rate — Band 2 (CAD 57,376–114,750)
30.5%Alberta Personal Income Tax Act (APITA); Income Tax Act (Canada)
Combined federal + Alberta rate — Band 3 (CAD 114,751–158,468)
36%Alberta Personal Income Tax Act (APITA); Income Tax Act (Canada)
Combined federal + Alberta rate — Band 4 (CAD 158,469–220,000)
39%Alberta Personal Income Tax Act (APITA); Income Tax Act (Canada)
Combined federal + Alberta rate — Band 5 (CAD 220,001+)
43%Alberta Personal Income Tax Act (APITA); Income Tax Act (Canada)
Federal GST rate
5%Excise Tax Act (Canada)
Alberta provincial sales tax (PST)
None — Alberta has no PSTAlberta Personal Income Tax Act (APITA)
Alberta basic personal amount (2025)
$21,003Alberta Personal Income Tax Act (APITA); Form AB428
Alberta spousal / common-law partner amount (2025)
$21,003 (reduced by spouse income)Alberta Personal Income Tax Act (APITA); Form AB428
Alberta eligible dependant amount (2025)
$21,003Alberta Personal Income Tax Act (APITA); Form AB428
Alberta age amount (65+) (2025)
$5,853 (reduced at higher income)Alberta Personal Income Tax Act (APITA); Form AB428
Alberta pension income amount (2025)
Up to $1,636Alberta Personal Income Tax Act (APITA); Form AB428
Alberta disability amount (2025)
$16,494Alberta Personal Income Tax Act (APITA); Form AB428
Alberta medical expenses threshold
Excess over 3% of net income or $2,635, whichever is lessAlberta Personal Income Tax Act (APITA); Form AB428
Alberta donations and gifts credit — first $200
10%Alberta Personal Income Tax Act (APITA); Form AB428
Alberta donations and gifts credit — excess over $200
21%Alberta Personal Income Tax Act (APITA); Form AB428
Alberta political contributions credit — 75% of first $200
75% of first $200Alberta Personal Income Tax Act (APITA); Form AB428
Alberta political contributions credit — 50% of next $900
50% of next $900 ($201–$1,100)Alberta Personal Income Tax Act (APITA); Form AB428
Alberta political contributions credit — 33.33% above $1,100
33.33% above $1,100Alberta Personal Income Tax Act (APITA); Form AB428
Alberta non-refundable credit conversion rate
10%Alberta Personal Income Tax Act (APITA); Form AB428
Alberta Family Employment Tax Credit (AFETC) — maximum benefit (4+ children)
Up to ~$1,469Alberta Personal Income Tax Act (APITA); Form AB428
AFETC phase-out rate
4% of family income above ~$43,295Alberta Personal Income Tax Act (APITA)
AFETC income phase-out threshold
~$43,295Alberta Personal Income Tax Act (APITA)
Alberta dividend tax credit — eligible dividends (public corps)
8.12% of taxable (grossed-up) amountAlberta Personal Income Tax Act (APITA); Form AB428
Alberta dividend tax credit — non-eligible dividends (CCPCs)
2.31% of taxable (grossed-up) amountAlberta Personal Income Tax Act (APITA); Form AB428
Federal gross-up — eligible dividends
38%Income Tax Act (Canada)
Federal gross-up — non-eligible dividends
15%Income Tax Act (Canada)
Combined tax on eligible dividends — top bracket (AB)
~34.3%Alberta Personal Income Tax Act (APITA); Income Tax Act (Canada)
Combined tax on non-eligible dividends — top bracket (AB)
~42.3%Alberta Personal Income Tax Act (APITA); Income Tax Act (Canada)
Capital gains inclusion rate — first $250,000 (individuals)
50%Income Tax Act (Canada)
Capital gains inclusion rate — above $250,000 (individuals)
Not applicable — proposed $250,000 higher-inclusion threshold was cancelled; current inclusion rate remains 50% for all capital gainsPM announcement March 21, 2025 cancelling proposed capital-gains inclusion-rate increase; CRA administration update; ITA s.38; LCGE increase retained at $1.25M for 2025
Capital gains annual threshold (individuals) — inclusion rate change
Not applicable — proposed $250,000 higher-inclusion threshold was cancelled; current inclusion rate remains 50% for all capital gainsPM announcement March 21, 2025 cancelling proposed capital-gains inclusion-rate increase; CRA administration update; ITA s.38; LCGE increase retained at $1.25M for 2025
Combined rate on capital gains (50% inclusion) — top bracket (AB)
21.5%Alberta Personal Income Tax Act (APITA); Income Tax Act (Canada)
Lifetime Capital Gains Exemption — qualifying small business shares (2025)
$1,250,000Income Tax Act (Canada)
Lifetime Capital Gains Exemption — qualified farm/fishing property (2025)
$1,250,000Income Tax Act (Canada)
CPP contribution rate (self-employed, both portions)
11.9% on pensionable earnings $3,500–$71,300Canada Pension Plan Act (Canada)
CPP basic exemption (lower limit)
$3,500Canada Pension Plan Act (Canada)
CPP Year's Maximum Pensionable Earnings (YMPE)
$71,300Canada Pension Plan Act (Canada)
CPP2 additional contribution rate
4% on earnings $71,300–$79,400Canada Pension Plan Act (Canada)
CPP2 Year's Additional Maximum Pensionable Earnings upper limit
$79,400Canada Pension Plan Act (Canada)
Alberta SR&ED provincial top-up credit rate
10% of qualifying SR&ED expendituresAlberta Corporate Tax Act; Alberta Tax and Revenue Administration
T1 filing deadline — general (tax year 2025)
30 April 2026Income Tax Act (Canada)
T1 filing deadline — self-employed (tax year 2025)
15 June 2026Income Tax Act (Canada)
Balance due date — self-employed (tax year 2025)
30 April 2026Income Tax Act (Canada)
Instalment threshold — net tax owing
> $3,000 in current year and either of prior two yearsIncome Tax Act (Canada)
Late-filing penalty — base
5% of balance owingIncome Tax Act (Canada)
Late-filing penalty — monthly addition (max 12 months)
1% per month, maximum 12 monthsIncome Tax Act (Canada)
Interest on balance owing
Prescribed rate compounded dailyIncome Tax Act (Canada)
Quick Reference
| Field | Value |
|---|---|
| Province | Alberta (Canada) |
| Tax | Provincial Personal Income Tax |
| Currency | CAD only |
| Tax year | 1 January -- 31 December 2025 |
| Primary legislation | Alberta Personal Income Tax Act (APITA) |
| Supporting legislation | Income Tax Act (Canada) -- federal; Alberta Tax and Revenue Administration |
| Tax authority | Canada Revenue Agency (administers on behalf of Alberta) |
| Filing portal | CRA My Account / NETFILE / paper T1 |
| Filing deadline | 30 April 2026 (15 June 2026 if self-employed; balance due 30 April) |
| Skill version | 1.0 |
Alberta Provincial Tax Rate (2025)
| Taxable Income (CAD) | Rate |
|---|---|
| All taxable income | 10% (flat rate) |
Alberta is the only province with a single flat-rate personal income tax. There are no provincial tax brackets.
Key Alberta Features
| Feature | Detail |
|---|---|
| Provincial sales tax (PST) | None -- Alberta has no PST |
| GST only | 5% federal GST applies |
| Alberta personal amount (2025) | $21,003 |
| Spousal/equivalent amount | $21,003 |
| Age amount (65+) | $5,853 (reduced at higher income) |
| Alberta Family Employment Tax Credit | Refundable credit for working families with children under 18 |
| Alberta Climate Leadership Adjustment | Phased out |
| Alberta child and family benefit | Income-tested provincial benefit |
Federal Tax Rates (2025) -- For Reference
| Taxable Income (CAD) | Rate |
|---|---|
| 0 -- 57,375 | 15% |
| 57,376 -- 114,750 | 20.5% |
| 114,751 -- 158,468 | 26% |
| 158,469 -- 220,000 | 29% |
| 220,001+ | 33% |
Combined Federal + Alberta Marginal Rates (2025)
| Taxable Income (CAD) | Combined Rate |
|---|---|
| 0 -- 57,375 | 25% |
| 57,376 -- 114,750 | 30.5% |
| 114,751 -- 158,468 | 36% |
| 158,469 -- 220,000 | 39% |
| 220,001+ | 43% |
Conservative Defaults
| Ambiguity | Default |
|---|---|
| Unknown residency province on Dec 31 | Do not compute provincial tax -- confirm province |
| Unknown marital status | Single (no spousal credit) |
| Unknown dependant eligibility | No dependant credits claimed |
| Unknown employment status | Employed (T4 reporting) |
T1 Structure
| Schedule | Purpose |
|---|---|
| T1 General | Federal return |
| Form AB428 | Alberta Tax and Credits |
| Schedule AB(S12) | Alberta Tax (calculation) |
| Schedule 1 | Federal tax calculation |
Provincial Credits (Form AB428)
| Credit | Amount (2025) | Type |
|---|---|---|
| Basic personal amount | $21,003 | Non-refundable |
| Spousal / common-law partner | $21,003 (reduced by spouse income) | Non-refundable |
| Eligible dependant amount | $21,003 | Non-refundable |
| CPP/QPP contributions (employee) | Actual contributions | Non-refundable |
| EI premiums | Actual premiums | Non-refundable |
| Age amount (65+) | $5,853 | Non-refundable (income-tested) |
| Pension income amount | Up to $1,636 | Non-refundable |
| Disability amount | $16,494 | Non-refundable |
| Tuition and education | Actual tuition | Non-refundable |
| Medical expenses | Excess over 3% of net income (or $2,635) | Non-refundable |
| Donations and gifts | First $200 at 10%; excess at 21% | Non-refundable |
| Political contributions (Alberta) | 75% of first $200 + 50% next $900 + 33.33% above | Non-refundable |
Alberta Family Employment Tax Credit (AFETC)
| Element | Detail |
|---|---|
| Eligibility | Working families with children under 18, family income below threshold |
| Maximum benefit | Varies by number of children (up to ~$1,469 for 4+ children) |
| Reduction rate | Phases out at 4% of family income above ~$43,295 |
| Type | Refundable credit |
| Claim | Automatic through T1 filing |
Alberta Dividend Tax Credit
| Dividend Type | Federal Gross-Up | AB Credit Rate |
|---|---|---|
| Eligible dividends (public corps) | 38% gross-up | 8.12% of taxable amount |
| Non-eligible dividends (CCPCs) | 15% gross-up | 2.31% of taxable amount |
Combined tax on eligible dividends (top bracket): ~34.3% Combined tax on non-eligible dividends (top bracket): ~42.3%
Self-Employment Considerations
| Item | Detail |
|---|---|
| CPP contributions | Both portions: 11.9% on pensionable earnings $3,500 -- $71,300 |
| CPP2 | Additional 4% on earnings $71,300 -- $79,400 (2025) |
| No provincial payroll tax | Alberta does not levy employer payroll tax |
| Business expenses | Deducted against federal + provincial income |
| Home office | Federal rules apply; reduces both federal and provincial income |
Income Patterns
| Pattern | Treatment | Notes |
|---|---|---|
| T4 EMPLOYMENT INCOME | Taxable | Box 14 of T4 |
| T4A PENSION, RETIREMENT | Taxable | May qualify for pension income amount |
| T5 INVESTMENT INCOME (interest, dividends) | Taxable | Eligible dividends get enhanced gross-up and credit |
| T3 TRUST INCOME | Taxable | Various character allocations |
| RENTAL INCOME (T776) | Taxable | Net rental income |
| SELF-EMPLOYMENT (T2125) | Taxable | Net business income |
| CAPITAL GAINS (Schedule 3) | 50% taxable | Inclusion rate for individuals |
Alberta-Specific Considerations
| Item | Treatment |
|---|---|
| Resource royalties (farm/oil) | May have Alberta Royalty Tax Credit implications |
| Farm income | Small farm tax credit may apply |
| Scientific research credits | Alberta SRED top-up (10% of qualifying SR&ED expenditures) |
Filing Requirements
| Item | Detail |
|---|---|
| Form | T1 General + Form AB428 (Alberta Tax and Credits) |
| Deadline | 30 April 2026 (15 June if self-employed; balance due remains 30 April) |
| Instalments | Required if net tax owing > $3,000 in current and either of prior two years |
| Penalty (late filing) | 5% of balance owing + 1% per month (max 12 months) |
| Interest | Prescribed rate compounded daily on balance owing |
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Other Canada computations in the OpenAccountants Tax Library.
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