Newfoundland and Labrador has one of the most progressive tax systems in Canada with eight provincial tax brackets — more than any other province. Rates range from 8.7% to 21.80%, and the top combined federal-provincial rate of 54.80% is among the highest in the country.
Newfoundland 2025 provincial tax brackets
| Taxable Income | Tax Rate |
|---|---|
| First $44,192 | 8.70% |
| $44,192 to $88,382 | 14.50% |
| $88,382 to $157,792 | 15.80% |
| $157,792 to $220,910 | 17.80% |
| $220,910 to $282,214 | 19.80% |
| $282,214 to $564,429 | 20.80% |
| $564,429 to $1,128,858 | 21.30% |
| Over $1,128,858 | 21.80% |
The basic personal amount in Newfoundland for 2025 is $10,818, meaning the first $10,818 of income is effectively tax-free at the provincial level.
Newfoundland 2024 provincial tax brackets
| Taxable Income | Tax Rate |
|---|---|
| First $43,198 | 8.70% |
| $43,198 to $86,395 | 14.50% |
| $86,395 to $154,244 | 15.80% |
| $154,244 to $215,943 | 17.80% |
| $215,943 to $275,870 | 19.80% |
| $275,870 to $551,739 | 20.80% |
| $551,739 to $1,103,478 | 21.30% |
| Over $1,103,478 | 21.80% |
The rates are unchanged between 2024 and 2025; only the bracket thresholds have been indexed for inflation.
Federal tax brackets 2025
| Taxable Income | Tax Rate |
|---|---|
| First $57,375 | 15.00% |
| $57,375 to $114,750 | 20.50% |
| $114,750 to $158,468 | 26.00% |
| $158,468 to $220,000 | 29.00% |
| Over $220,000 | 33.00% |
Federal tax brackets 2024
| Taxable Income | Tax Rate |
|---|---|
| First $55,867 | 15.00% |
| $55,867 to $111,733 | 20.50% |
| $111,733 to $154,906 | 26.00% |
| $154,906 to $220,000 | 29.00% |
| Over $220,000 | 33.00% |
Combined federal and Newfoundland marginal tax rates (2025)
| Taxable Income | Federal Rate | NL Rate | Combined Rate |
|---|---|---|---|
| First $44,192 | 15.00% | 8.70% | 23.70% |
| $44,192 to $57,375 | 15.00% | 14.50% | 29.50% |
| $57,375 to $88,382 | 20.50% | 14.50% | 35.00% |
| $88,382 to $114,750 | 20.50% | 15.80% | 36.30% |
| $114,750 to $157,792 | 26.00% | 15.80% | 41.80% |
| $157,792 to $158,468 | 26.00% | 17.80% | 43.80% |
| $158,468 to $220,000 | 29.00% | 17.80% | 46.80% |
| $220,000 to $220,910 | 33.00% | 17.80% | 50.80% |
| $220,910 to $282,214 | 33.00% | 19.80% | 52.80% |
| $282,214 to $564,429 | 33.00% | 20.80% | 53.80% |
| $564,429 to $1,128,858 | 33.00% | 21.30% | 54.30% |
| Over $1,128,858 | 33.00% | 21.80% | 54.80% |
The 54.80% top rate is one of the highest in Canada, exceeded only by Newfoundland’s complex bracket structure reaching that level. The eight brackets create a very gradual progression.
Example: Tax on $80,000 income in Newfoundland (2025)
Newfoundland provincial tax:
- $44,192 × 8.70% = $3,845
- ($80,000 - $44,192) × 14.50% = $5,192
- Total provincial tax: $9,037
Federal tax:
- $57,375 × 15.00% = $8,606
- ($80,000 - $57,375) × 20.50% = $4,638
- Total federal tax: $13,244
Combined tax on $80,000: approximately $22,281 (before credits)
After the basic personal amounts and other credits, the effective tax would be lower. At $80,000, NL residents pay more than those in Alberta, BC, or Yukon at the same income level.
NL Low-Income Tax Reduction
Newfoundland offers a Low-Income Tax Reduction for individuals earning less than approximately $21,755. This credit reduces or eliminates provincial income tax for lower-income residents, with the reduction phasing out as income increases.
How Newfoundland compares to other provinces
| Province | Top Combined Rate | Lowest Combined Rate |
|---|---|---|
| Nunavut | 44.50% | 19.00% |
| Yukon | 48.00% | 21.40% |
| Alberta | 48.00% | 25.00% |
| Ontario | 53.53% | 20.05% |
| British Columbia | 53.50% | 20.06% |
| Quebec | 53.31% | 26.53% |
| Nova Scotia | 54.00% | 23.79% |
| Newfoundland | 54.80% | 23.70% |
Newfoundland’s top rate of 54.80% is among the highest in Canada. However, the extensive bracket structure means the highest rates only apply at very high income levels (over $1.1 million).
Tax planning for Newfoundland residents
- RRSP contributions — among the most valuable in NL due to high marginal rates; see the RRSP contribution limit guide
- TFSA — tax-free growth is especially valuable with high marginal rates; see the TFSA contribution limit guide
- FHSA — first-time homebuyers can save up to $40,000 tax-free; see the FHSA calculator
- Average income — see average income in Newfoundland to understand where you stand
Frequently asked questions
What are the Newfoundland tax brackets for 2025?
NL has eight brackets from 8.7% on the first $44,192 to 21.80% on income over $1,128,858.
What is the top combined tax rate in Newfoundland?
The top combined rate is 54.80% on income over $1,128,858, one of the highest in Canada.
Does Newfoundland have a surtax?
No, but the eight-bracket system with rates up to 21.80% achieves a very progressive structure that effectively serves the same purpose.
Related guides
- Average income in Newfoundland
- Newfoundland sales tax calculator
- Newfoundland mortgage rates
- RRSP contribution limit guide
- TFSA contribution limit guide
- Income percentile calculator
