On November 4, 2025, the Carney government tabled its highly anticipated first budget. While the tax package is modest, it delivers targeted relief for everyday taxpayers, homeowners, business owners, and retirees.
Below is your plain-English guide to the five big wins—and the one retirement measure that stayed on the wish list.
- New “Top-Up Tax Credit” – No One Pays More Because of the Tax Cut
The Problem It Fixes Last year the lowest federal tax bracket dropped from 15% to 14.5% (2025) and will hit 14% (2026+). Non-refundable credits (basic personal amount, spouse, tuition, medical, etc.) are calculated at the lowest rate. → In rare cases, big one-time credits could shrink more than the tax saving—leaving you worse off.
The Fix A temporary Top-Up Credit keeps the 15% value on any credit amount that spills above the first $57,375 of income. Valid 2025–2030.
Who Wins?
- Students cashing in years of tuition credits
- Families with huge medical bills
- Anyone carrying forward old credits
Bottom line: The middle-class tax cut now helps everyone—no hidden losers.
- Home Accessibility Upgrades – Last Chance for Double Dip
Current Rule Same renovation (grab bars, ramps, elevators) can be claimed twice:
- Home Accessibility Tax Credit (HATC) → up to $3,000 credit
- Medical Expense Tax Credit (METC) → 15% of excess over 3% of income
2026 Change Same expense → only one credit.
Act before Dec 31, 2025 Finish and pay for the work in 2025 → lock in both credits on your 2025 return. Seniors 65+ and Disability Tax Credit holders: book your contractor now.
- Federal Underused Housing Tax (UHT) – Gone Forever
Old Headache 1% annual tax + mandatory filing for foreign-owned or “underused” homes. Late filing = $5,000–$10,000 penalties.
New Reality (2025 onward)
- No tax
- No filing
- All prior-year penalties & interest waived
- Every dollar already paid refunded automatically (with interest)
Foreign buyers & snowbirds: breathe easy.
- Luxury Tax on Planes & Boats – Scrapped
Effective November 5, 2025:
- Aircraft >$100,000 → tax-free
- Vessels >$250,000 → tax-free
Luxury car tax (> $100,000) stays. Aviation & marine industries celebrate lower costs and simpler paperwork.
- Canadian Entrepreneurs’ Incentive (CEI) – Officially Cancelled
What Was Promised Extra capital-gains break on up to $2 million lifetime when selling your business.
What Happened Cancelled alongside the capital-gains inclusion hike that never passed.
New Playbook for Sellers
- Lifetime Capital Gains Exemption now $1.25 million
- Family trusts & rollovers
- Purify early for QSBC status
Talk to us before you list—small tweaks can still save six figures.
The One That Got Away: RRIF Minimums Stay the Same
Election Promise One-year 25% cut to mandatory RRIF withdrawals.
Budget Reality No change. Seniors still face forced withdrawals that can:
- Push you into higher tax brackets
- Claw back OAS/GIS
- Deplete savings too fast
Our Fix
- Withdraw only the minimum
- Reinvest in a non-registered account or TFSA
- Use spousal rollovers to lower the %
Taxes Change Every Year—Turn Rules into Cash Flow
As your full-service CPA firm, we turn budget headlines into your money:
🎯 Personal tax planning & filing
🏢 Business sale structuring
🏠 Cross-border & UHT refund claims
🧓 RRIF withdrawal optimization
👨👩👧 Accessibility credit double-dip
💡 High-net-worth trusts & estate freezes
Free 15-Minute Budget Check-Up
Drop your 2024 notice of assessment in the chat or book online— we’ll map exactly how much you save under the new rules.
💬 Reply “2025” and we’ll send your personalized savings calculator.
Let policy work for you—schedule your call today! 🚀