Canadian Income Tax Act with Regulations, Annotated, 118th Edition, 2026

Canadian Income Tax Act with Regulations, provides valuable cross-references, comprehensive editorial notes, and a breadth of related third-party references, all selected by experienced tax specialists.

The Full Text of the Income Tax Act and Regulations 

Since the Income War Tax Act first came into force over a century ago, the size and complexity of the legislation have grown exponentially. Over the past months, numerous new amendments and proposals continued this trend. Canadian Income Tax Act with Regulations, Annotated contains all the latest legislative developments since the previous edition, which notably includes:

Recent changes to the Act, including:

• • Bill C-15, Budget 2025 Implementation Act, No. 1, Royal Assent March 16, 2026—this bill included technical measures and the following measures from the 2025 Budget and other previously released proposals:

• • • Employee Ownership Trust Tax Exemption
    • Workers Cooperatives
    • Scientific Research and Experimental Development Tax Incentive Program
    • Eligible activities under the Canadian Exploration Expense
    • Capital Gains Rollover on Investments
    • Clean Electricity Investment Tax Credit
    • Investment Tax Credit for Carbon Capture, Utilization, and Storage
    • Proposals relating to various Clean Economy Tax Credits
    • Clean Technology Investment Tax Credit
    • Clean Hydrogen Investment Tax Credit
    • Clean Technology Manufacturing Investment Tax Credit
    • Mutual Fund Corporations
    • Substantive CCPCs
    • Disability Supports Deduction
    • Agricultural Cooperatives: Patronage Dividends Paid in Shares
    • Synthetic Equity Arrangements
    • Transfer Pricing
    • Withholding for Non-Resident Service Providers
    • Home Accessibility Tax Credit
    • Personal Support Worker Tax Credit
    • Critical Mineral Exploration Tax Credit
    • Accelerated Capital Cost Allowance for Purpose-Built Rental Housing
    • Accelerated Capital Cost Allowance for Productivity-Enhancing Assets
    • Immediate Expensing for Manufacturing and Processing Buildings
    • Top-Up Tax Credit
  • Bill C-19, Canada Groceries and Essentials Benefit Act, Royal Assent February 12, 2026-this bill increased the maximum annual GST/HST credit amounts.

Recent changes to Regulations, including:

• • Regulations Amending the Income Tax Regulations (Motor Vehicle Expenses and Benefits 2024-2025): SOR/2025-193, September 19, 2025-amendments to capital cost ceilings, interest expense limit, leasing limit, tax-exempt per-kilometre allowance limit, and operating expense benefit rate to help define the level of automobile expense deductions and taxable benefits allowed under the Act.
  • Regulations Amending the Income Tax Regulations (2023-2024 Livestock Deferral): SOR/2025-194, September 19, 2025-amendments to allow for the application of the tax deferral in the regions identified as having been affected by drought, flood or excess moisture conditions.

Proposed tax measures, including:

• Bill C-30, Spring Economic Update 2026 Implementation Act-this bill includes the following measures:

• • Labour mobility deduction
  • Employee Ownership Trust Tax Exemption
  • Home Buyers' Plan
  • Eligible Greenhouses

• Bill C-31, Budget 2025 Implementation Act, No. 2-this bill includes the following measures:

• • Qualified investments for registered plans
  • 21-Year Rule
  • Canada Carbon Rebate
  • Immediate Expensing for Manufacturing and Processing Buildings
  • Tax Deferral Through Tiered Corporate Structures
  • Eligible activities under the Canadian Exploration Expense
  • Clean Hydrogen Investment Tax Credit
  • Investment Tax Credit for Carbon Capture, Utilization and Storage
  • Automated Federal Benefits for Lower-Income Individuals
  • Crypto-Asset Reporting Framework and the Common Reporting Standard
  • Non-Compliance with Information Requests

• Legislative Proposals Relating to the Income Tax Act and the Income Tax Regulations, January 29, 2026—these proposals include the following measures from the 2025 Budget and other previously released proposals:

• • Investment Income Derived from Assets Supporting Canadian Insurance Risks
  • Reporting by Non-profit Organizations
  • Hybrid Mismatch Rules

• Legislative Proposals Relating to the Income Tax Act and the Income Tax Regulations (FES 2024 and other proposals), August 15, 2025-these proposals include the following measures from the 2024 Fall Economic Statement:

• • Excessive Interest and Financing Expenses Limitation Rules

Additional features:

• Editorial notes with explanations, tips, and traps
• The Multilateral Instrument, which modifies the terms of tax treaties between Canada and agreeing countries
• Full text of the Canada-U.S. Tax Treaty, with detailed editorial notes by Dentons Canada LLP
• Full text of the Canada-U.K. Tax Treaty

Key references to additional resources, including:

• Cross references to related sections of the Act and Regulations
• Income tax folios, bulletins, circulars, technical interpretations, forms, guides, comfort letters, and news releases
• Canadian Tax Foundation, STEP Canada, and Wolters Kluwer newsletter articles
• Case annotations summarizing key court decisions

Numerous quick reference charts, including:

• 2026 tax rates and credits tables from PricewaterhouseCoopers LLP
• Tables of automobile, mileage, interest, exchange, and capital cost allowance rates
• Tax integration tables from PricewaterhouseCoopers LLP
• Summary tables of deadlines, offences, and penalties, and a tax calendar

Download - Examples of Editorial Notes

Editorial Board — As of July 2026

Trust the tax and accounting intelligence from the top firms in Canada:

Joseph Frankovic LL.B., LL.M., Ph.D., CFA
Member of the Ontario Bar and the adjunct faculty of Osgoode Hall Law School

Dentons Canada LLP
Hannah Bourgeois B.A., J.D.
Paige Donnelly J.D., MBA, CFA
Gergely Hegedus, LL.B.
Mark Jadd LL.B.        
Larry Nevsky LL.B., CPA, CA 
Daniel Safi LL.B., J.D., LL.M.
Oliver Nam H.B.A., J.D.

Aird & Berlis LLP
Michael Goldberg B. Comm. Hons., LL.B.

PricewaterhouseCoopers LLP
Catherine Hibbard CPA, CA
Ruby Lim CPA, CA
Colin Mowatt CPA, CA

Wolters Kluwer Canada Limited
Robert Boucher CPA, CA
Jennifer Corris B.Math
Mark Ho CPA (Australia)
Cameron Mancell CFP®
Roderick McBey GJM, BA, LL.B., TEP
Ellen McClure LL.B., LL.M.
Peter Tomlinson B.A., LL.B.