April 26, 2012

No. 2012-22



2012 Tax Rates — A Done Deal

Now that all of the 2012 federal and provincial budgets have been announced, including a last-minute amendment for Ontario on April 24, 2012, personal and corporate tax rates are now officially set for 2012. Check out KPMG’s 2012 tax rate tables and other online resources, including our new mobile app Tax Hub Canada, to stay up-to-date on these recent developments.

Corporate tax rates

The most significant rate change for corporations is Ontario’s proposal to freeze its corporate tax rate at 11.5% and defer previously announced corporate tax rate reductions until its deficit is eliminated. It should be noted however that this Ontario rate freeze is not yet considered to be “substantively enacted” for purposes of Canadian GAAP/IFRS.

In addition, Nova Scotia proposed to reduce its effective small business corporate income tax rate to 3.5% effective January 1, 2013.

A summary of the tax rates applicable for general corporations and Canadian-controlled private corporations are available via the Canadian Corporate Tax Tables page on

Personal tax rates

Some provinces’ tax rates have been affected by changes in the 2012 budgets. The Ontario government will introduce legislation to create a temporary new top income tax bracket for individuals who earn more than $500,000 a year. As a result, the top statutory Ontario income tax rate on taxable incomes of more than $500,000 will increase to 12.16% for all of 2012 (from 11.16%) and to 13.16% in 2013. As a result, the top Ontario marginal tax rates for 2012 and 2013 on different types of income will be as follows:


Effective eligible dividend tax rates will also change in other provinces. Manitoba will increase its top marginal tax rate to 32.27% and British Columbia will decrease its rate to 25.78%.

A summary of the personal income tax rates and brackets and the combined top marginal tax rates for various types of income are available via the Canadian Personal Tax Tables page on

Additional 2012 budget information

More details on the 2012 budgets are available in KPMG’s news alerts for the following jurisdictions, which are available via the Federal and Provincial Budgets page on

·      Federal

·      British Columbia

·      Alberta

·      Saskatchewan

·      Manitoba

·      Ontario

·      Quebec

·      New Brunswick

·      Prince Edward Island

·      Nova Scotia

·      Newfoundland and Labrador.

Download KPMG’s new Tax Hub Canada app

KPMG’s free Tax Hub Canada App for iPads and Blackberrys provides timely, convenient tax news and tax rates to help you respond to changes in tax rules and regulations. Download the app today.

We can help

Your KPMG adviser can help you assess the effect of the tax changes in this year’s federal and provincial  budgets on your personal finances or business affairs, and point out ways to take advantage of their benefits or ease their impact. We can also keep you abreast of the progress of these proposals as they make their way into law and help you bring any concerns you may have to the attention of the tax authorities.




Information is current to April 26, 2012. The information contained in this TaxNewsFlash-Canada is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG’s National Tax Centre at 416.777.8500.

KPMG LLP, the audit, tax and advisory firm (, a Canadian limited liability partnership established under the laws of Ontario, is the Canadian member firm of KPMG International Cooperative (“KPMG International”). KPMG International’s member firms have 140,000 professionals, including more than 7,900 partners, in 146 countries.

The independent member firms of the KPMG network are affiliated with KPMG International, a Swiss entity. Each KPMG firm is a legally distinct and separate entity, and describes itself as such.

KPMG's Canadian Web site is located at

© 2012 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.


The KPMG name, logo and “cutting through complexity” are registered trademarks or trademarks of KPMG International.