By Aaron Hector
The TFSA limit rises to $7,500 in 2027, and federal tax brackets, credits and benefit thresholds rise 2.6%. Statistics Canada published September’s Consumer Price Index on October 19, 2026. That was the last month of data in the formula, so the data behind the 2027 factor is now complete.
When CRA confirms
These are our calculations. CRA confirms the official amounts later in the fall, and in each of the last three years it did so in mid-to-late November: November 23, 2023 (2024 amounts), November 15, 2024 (2025 amounts) and November 24, 2025 (2026 amounts). We expect the 2027 list on a similar timeline.
Below we explain how the numbers are set, how we traced each one back to the Income Tax Act, and what changes for you.
The formula
How indexation works
Every year, section 117.1 of the Income Tax Act increases most personal tax amounts by the change in average prices. The formula compares two twelve-month windows of the all-items CPI, each ending September 30.
All-items CPI, October 2024 to September 2026
Monthly, not seasonally adjusted, 2002 = 100. Dashed lines mark each window’s twelve-month average.
Source: Statistics Canada, table 18-10-0004-01 and The Daily CPI releases.
The 2027 calculation
| Twelve-month window | Average CPI |
|---|---|
| Oct 2024 – Sep 2025 | 163.275 |
| Oct 2025 – Sep 2026 | 167.525 |
| Change, rounded to 0.1% | 2.603% → 2.6% |
The factor is rounded to the nearest one-tenth of a percent and applies to everything indexed for the coming year. Because the formula stops at September, the 2027 factor could be calculated as soon as September’s CPI was published.
One detail matters for precision. Under the Income Tax Act, each amount is indexed from its unrounded value for the year before, and is rounded to the dollar only for use and publication. Multiplying the published 2026 amount by 1.026 can therefore be a dollar off. The basic personal amount is an example: the shortcut gives $16,880, but indexing from the $15,000 the Act set for 2023 gives $16,879.
Tax · Benefits · Registered plans
What changes in 2027
Applying 2.6% to this year’s numbers gets you close. We wanted more than close. For every federal amount, we traced the figure back to the dollar amount Parliament wrote into the Income Tax Act, indexed it forward one year at a time the way the Act does, and checked each step against the amounts CRA has published. Every indexed amount came through that test except five, all belonging to the Canada Groceries and Essentials Benefit, which turn on how a 2026 amendment is read.
The results
Amounts we are certain of
Every one of these traces back to a base in the Act and reproduces the amounts CRA has published, in many cases fourteen or more years of them. Barring a change in legislation, these are the 2027 amounts.
Certain: key federal amounts for 2027
| Amount | 2027 | Traced back to |
|---|---|---|
| TFSA annual limit | $7,500 | $5,000 in 2009, rounded to the nearest $500 |
| ALDA lifetime limit | $190,000 | $150,000 in 2020, rounded to the nearest $10,000 |
| OAS clawback threshold | $97,801 | $50,000 in 1989; matches all 37 thresholds published since |
| Lifetime capital gains exemption | $1,308,150 | $1,250,000; indexing resumed in 2026 |
| Capital gains deduction limit | $654,075 | Half the exemption |
| 20.5% bracket begins | $60,044 | $57,375, restated in the Act for 2025 |
| 26% bracket begins | $120,088 | $114,750, restated in the Act for 2025 |
| 29% bracket begins | $186,157 | $177,882, restated in the Act for 2025 |
| 33% bracket begins | $265,203 | $253,414, restated in the Act for 2025 |
| Basic personal amount (maximum) | $16,879 | $15,000, set in the Act for 2023 |
| Basic personal amount (minimum, high incomes) | $15,215 | Continuing chain; only $15,215 fits eleven published years since 2010 |
| Enhanced portion of the basic personal amount | $1,664 | Maximum less minimum, as CRA calculated it for 2026 |
| Age amount | $9,448 | $6,408, set for 2009 |
| Age amount income threshold | $47,639 | $25,921, fully indexed from 2000 |
| Disability amount | $10,610 | $6,000, set for 2001 |
| Medical expense threshold | $2,966 | $1,813, set for 2004 |
| Canada child benefit, under 6 (from July) | $8,369 | $6,400, set for July 2016 |
| Canada child benefit, 6 to 17 (from July) | $7,062 | $5,400, set for July 2016 |
| Canada training credit income ceiling | $181,440 | CRA’s published 2026 29% bracket threshold |
| Canada caregiver amount, infirm child or spouse | $2,812 | $2,150, set for 2017 |
2026: CRA, Adjustment of personal income tax and benefit amounts. Historical checks: CRA indexation tables for 2010 to 2016 and 2020 to 2026, CRA payroll formulas (T4127) for 2023, and published amounts for other years. Every federal amount is in the full list below.
How we traced them
Back to the beginning
Take the age amount. Parliament set it at $6,408 for 2009. Since then it has been indexed seventeen times. Carrying the unrounded amount forward through each year’s factor lands on the published figure in every year from 2010 to 2026, all seventeen of them. One more step at 2.6% gives the 2027 amount.
Proof: the age amount, 2009 to 2027
Unrounded amount carried forward under section 117.1 of the Income Tax Act, compared with the published amount (CRA tables; 2017 to 2019 from TaxTips.ca).
| Year | Unrounded | CRA published | Check |
|---|---|---|---|
| 2009 (Act) | $6,408.00 | — | |
| 2010 | $6,446.45 | $6,446 | Matches |
| 2011 | $6,536.70 | $6,537 | Matches |
| 2012 | $6,719.73 | $6,720 | Matches |
| 2013 | $6,854.12 | $6,854 | Matches |
| 2014 | $6,915.81 | $6,916 | Matches |
| 2015 | $7,033.38 | $7,033 | Matches |
| 2016 | $7,124.81 | $7,125 | Matches |
| 2017 | $7,224.56 | $7,225 | Matches |
| 2018 | $7,332.93 | $7,333 | Matches |
| 2019 | $7,494.25 | $7,494 | Matches |
| 2020 | $7,636.64 | $7,637 | Matches |
| 2021 | $7,713.01 | $7,713 | Matches |
| 2022 | $7,898.12 | $7,898 | Matches |
| 2023 | $8,395.70 | $8,396 | Matches |
| 2024 | $8,790.30 | $8,790 | Matches |
| 2025 | $9,027.64 | $9,028 | Matches |
| 2026 | $9,208.19 | $9,208 | Matches |
| 2027 | $9,447.60 | Due Nov 2026 |
The tax brackets show why the method matters. The Act restates the thresholds at their 2025 values, so the 20.5% bracket starts from $57,375. Indexed by 2.0%, that is $58,522.50, which CRA published as $58,523 because the Act rounds a half up. Indexed again by 2.6%, the unrounded amount is $60,044.09, so the 2027 threshold is $60,044. Multiplying CRA’s rounded $58,523 by 1.026 instead gives $60,044.60, a dollar too high.
Thirteen federal amounts come out a dollar different from the simple shortcut. The TFSA follows the same logic all the way back to its $5,000 start in 2009.
The OAS clawback threshold has the longest chain of all. It began at $50,000 in 1989, rose with partial indexing to $53,215 by 1992, was frozen until 1999 and has been fully indexed since 2000. Carried forward unrounded, that chain reproduces all 37 thresholds published from 1990 to 2026 and gives $97,801.35 for 2027.
The basic personal amount took the most digging. Recent years alone leave two possible values a dollar apart, so we pulled CRA’s published tables back to 2010. Only one value fits all eleven published years we found: the 2027 minimum is $15,215, and its enhanced portion is $1,664.
- Tax rates. The rates themselves are not indexed, only the brackets they apply to. The lowest federal rate stays at 14%, its level for 2026 and later years.
- Five amounts depend on legislation. All five belong to the Canada Groceries and Essentials Benefit, covered below under what could still change.
See all 55 federal amounts for 2027
Select a row for its base in the Income Tax Act.
Registered plans
The TFSA steps up to $7,500
The TFSA limit is $5,000 indexed every year since 2009, then rounded to the nearest $500. Underneath the published limit, the unrounded amount keeps compounding. For 2027 it rises from $7,184.92 to $7,371.72, past the $7,250 midpoint, so the limit steps up to $7,500.
This is the reason I was able to accurately determine a year ago that the 2027 TFSA limit would be $7,500. Once September 2025’s CPI was in, the unrounded amount stood at $7,184.92 and the prior twelve-month average CPI was 163.275. Because the formula compares averages, the price increases already built up during 2025 carry into the next window. Even if prices had not risen at all after September 2025, holding at 164.9, the new average would have been 164.9, a factor of 0.995% that rounds to 1.0%. That takes the unrounded amount to $7,256.77, past the $7,250 midpoint. Only falling prices could have kept the 2027 limit at $7,000. I set out that analysis in The Globe and Mail: “Why the 2027 TFSA contribution limit will rise to $7,500”.
TFSA limit and unrounded indexed amount, 2009 to 2027
Bars are the limit in force. 2015’s one-year $10,000 limit runs off the scale. The line is $5,000 indexed without rounding.
Indexation factors: CRA.
- Someone who has been 18 or older and resident in Canada since 2009 will have $116,500 of cumulative TFSA room in 2027, before any withdrawals or contributions.
- For 2028, the limit reaches $8,000 only if the unrounded amount passes $7,750, which takes indexation of at least 5.2%. For that, the average CPI from October 2026 to September 2027 would need to reach at least 176.153, up from 167.525 over the twelve months just ended. Prices would have to jump about 3.6% above September 2026’s 170.0 right away and stay there, or climb steadily at an annual pace of about 6.7%, to roughly 181.5 by September 2027. Anything less keeps 2028 at $7,500. 2028 way-too-early prediction: $7,500.
Caveats
What could still change
The 2.6% factor follows directly from the published CPI, and the amounts above follow from the Act. Two things could still move a figure.
- The Canada Groceries and Essentials Benefit. The benefit (formerly the GST/HST credit) was raised 25% from July 2026 by an amendment that sets new dollar amounts. Read literally, those amounts start indexing a year later, which would leave the July 2027 adult maximum at $445 rather than $457. CRA’s official list, expected in late November, will settle it.
- Legislation. Parliament can change any amount before or during 2027.
Planning
What this means for your plan
- TFSA. New room of $7,500 opens on January 1, 2027, on top of any unused room you carry forward. If you fund your TFSA early each year, build the larger amount into your January cash flow now.
- OAS clawback. The recovery tax takes 15% of net income above the threshold. A threshold of $97,801 gives you $2,478 more room before it starts. If you are close to it, the timing of RRIF withdrawals, pension income splitting and realized capital gains is worth revisiting.
- Bracket thresholds. Each federal bracket begins higher in 2027, from $60,044 for the 20.5% bracket to $265,203 for the 33% bracket. Income that only keeps pace with inflation is taxed at about the same rate.
- Age amount. The federal age amount of $9,448 starts to shrink by 15% of net income above $47,639 in 2027.
- Families. Canada child benefit amounts and thresholds rise 2.6% from July 2027. That year’s benefit is calculated on your 2026 income against the higher thresholds.
We build these figures into your Annual Financial Review as soon as CRA confirms them.
Want to see what 2027 means for your plan?
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These figures are TIER Wealth’s projections from Statistics Canada CPI data and CRA’s published 2026 amounts. They are not official until CRA publishes 2027 amounts, and legislation can change any of them. Although the author is an employee of Q Wealth and/or an employee of a partner firm of the Q Wealth Partnership, this is not an official Q Wealth publication, and the views expressed herein are those of the author alone, and they have not been approved by, and are not necessarily those of, Q Wealth. This is not legal, accounting, tax or investment advice and should not be relied on as such.
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