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These are the 2025 rates, for income earned in 2025 (the return filed in spring 2026). See the current 2026 Northwest Territories rates.

Northwest Territories Tax Rates for 2025

The top combined federal and Northwest Territories marginal rate is 47.05% on taxable income over $253,414. Capital gains are taxed at half your marginal rate, up to 23.53%; at the top, eligible dividends are taxed at 28.33% and non-eligible dividends at 36.82%.

Marginal, capital gains and dividend rates by income

Northwest Territories combined marginal and capital gains tax rates by taxable income, 2025
Taxable incomeMarginal rateCapital gains rateEligible dividendsNon-eligible dividends
Up to $51,964 20.40% 10.20% — —
$51,964 to $57,375 23.10% 11.55% — —
$57,375 to $103,930 29.10% 14.55% — —
$103,930 to $114,750 32.70% 16.35% 8.53% 20.32%
$114,750 to $168,967 38.20% 19.10% 16.12% 26.65%
$168,967 to $177,882 40.05% 20.03% 18.67% 28.77%
$177,882 to $253,414 43.05% 21.53% 22.81% 32.22%
Over $253,414 47.05% 23.53% 28.33% 36.82%

Rates apply to the next dollar of that type of income on top of the taxable income shown. Dividend rates are shown from $58,523 of other income; below that, the basic personal amounts and the non-refundable dividend credits mean little or no tax is payable. Eligible dividends come mainly from public corporations; non-eligible dividends mainly from private corporations' small-business income. Sources: the CRA's 2025 federal and provincial tax rates and brackets, with dividend tax credit rates from KPMG's Tax Facts 2025-2026, cross-checked against TaxTips.ca's combined rate tables. Credits (including the federal basic personal amount reduction for high incomes), the alternative minimum tax and income-tested benefits are not included. Estimates only, not tax advice.

What changed from 2024 to 2025

Northwest Territories headline rates, 2024 compared with 2025
20242025Change
Top marginal rate47.05%47.05%no change
Top capital gains rate23.53%23.53%no change
Top eligible dividend rate28.33%28.33%no change
Top non-eligible dividend rate36.82%36.82%no change
Lowest marginal rate20.90%20.40%-0.50 pts
Top rate starts at$246,752$253,414+2.7%
  • The federal lowest rate was cut from 15% to 14% on July 1, 2025, so the rate for the 2025 tax year is a blended 14.5% (CRA footnote).
  • Federal brackets were indexed by 2.7% for 2025 (KPMG).
Northwest Territories marginal tax rate by income, 2025 A step chart of the combined federal and Northwest Territories marginal rate as taxable income rises, from 20.4 percent at the lowest incomes to 47.1 percent above $253,414. 0% 10% 20% 30% 40% 50% 20.4% 29.1% 38.2% 43.1% 47.1% $0 $100k $200k $300k $400k Taxable income (2025)
Northwest Territories: your tax rate steps up as income rises. Each rate applies only to the income inside its slice, not to all of your income. Moving into a higher bracket raises the rate on the next dollar, not on the dollars below it. That next-dollar rate is your marginal rate, and it is the one that matters for deductions, losses and capital gains.
Dividend gross-up and tax credit A $1,000 eligible dividend is grossed up 38 percent to $1,380, taxed at your rates for about $527, then reduced by federal and provincial credits of $366, leaving about $161 of tax. You receive $1,000 eligible dividend Gross-up +38% $1,380 added to your income Tax at your rates $527 on $1,380 of income Dividend credits -$366 fed $207 + prov $159 Tax you pay $161 16.1% of the dividend Example with $120,000 of other taxable income in Northwest Territories, 2025 rates.
How an eligible dividend is taxed (example in Northwest Territories). Dividends from Canadian corporations are first grossed up to approximate the corporation's pre-tax profit, taxed like other income, and then reduced by dividend tax credits. That is why dividend rates are lower than the rate on interest. Non-eligible dividends use a smaller gross-up and smaller credits.
Capital gains inclusion rate Ten thousand dollars of interest is fully taxable, costing $3,820 at a 38.2 percent marginal rate. Ten thousand dollars of capital gain is only half taxable, costing $1,910, which is an effective rate of 19.1 percent. The same $10,000, taxed two ways (at a 38.2% marginal rate) Interest or salary fully taxable 100% taxable: $10,000 Tax $3,820 Capital gain only half is included 50% not taxed: $5,000 50% taxable: $5,000 Tax $1,910 Effective tax rate on a capital gain = marginal rate x 50% 38.2% x 50% = 19.1% on the gain, so a $1 loss saves half as much as a $1 of salary costs. Example at a 38.2% marginal rate. Your province and income change the rate (see Tax Rates).
The 50% capital gains inclusion rate. Only half of a capital gain is added to your taxable income, so the tax on a gain is half the tax on the same amount of interest or salary. The inclusion rate is 50% for 2026. A proposed increase to two-thirds was cancelled in March 2025.

Example: a $20,000 capital gain

With $120,000 of other taxable income in Northwest Territories, half of the gain ($10,000) is added to your income. The extra federal and provincial tax is about $3,820, an effective rate of 19.10% on the gain. A capital loss of the same size in the same year would save about the same amount.

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Frequently asked questions

What is the top marginal tax rate in Northwest Territories in 2025?

The top combined federal and provincial rate in Northwest Territories is 47.05%, on taxable income over $253,414.

What is the capital gains tax rate in Northwest Territories?

Half of a capital gain is taxable, so the rate on a gain is half of your marginal rate: from 10.20% on lower incomes up to 23.53% at the top.

What is the dividend tax rate in Northwest Territories in 2025?

At the top bracket the combined rate is 28.33% on eligible dividends and 36.82% on non-eligible dividends. At lower incomes the rates are lower because of the federal and Northwest Territories dividend tax credits; see the table above.

How much tax would I pay on a $20,000 capital gain in Northwest Territories?

With $120,000 of other taxable income, a $20,000 gain adds about $3,820 of federal and Northwest Territories tax, an effective rate of 19.10% on the gain.

Northwest Territories rates for other years

Other provinces in 2025

Related: Canadian tax-loss harvesting guide · superficial loss rule

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