Each year the CRA and the Province of Ontario adjust tax brackets, credits and contribution limits. For small businesses across the Greater Toronto Area, a handful of 2025 changes are the ones worth acting on before the next filing deadline.
Indexed brackets and credits
Federal and Ontario tax brackets, the basic personal amount, and most non-refundable credits are indexed to inflation. For 2025 the indexation adjustment is meaningful, which pushes more of your income into lower brackets and raises the room you have to contribute to an RRSP or TFSA.
Canada Pension Plan enhancement
CPP contribution rates and maximum pensionable earnings rose again under the multi-year enhancement. Owner-managers paying themselves a salary should model the impact on take-home pay, and self-employed individuals can claim the enhanced CPP deduction that offsets part of the increase.
What to do now
If your income rose, update your instalments so you aren't caught with a large balance at filing. If you crossed an HST threshold, review your filing schedule. And revisit your salary-versus-dividend mix ahead of your fiscal year-end — a short planning conversation now avoids a surprise in April.