Tax Planning
5 Key Tax Changes in Canada Every Business Should Know Now
Recent Canadian tax reforms bring relief to employers and businesses in areas such as CPP contribution rates, investment incentives, and employee-ownership—key shifts to factor into your 2026 tax planning.
By NomadicTax Research Team • 5-8 min read • June 13, 2026
## Overview of Major Business Tax Changes
Canada’s Spring Economic Update 2026 introduces several reforms with direct impact on businesses and high-income earners. Finance Minister François-Philippe Champagne delivered changes around accelerated deductions, tax credits, ownership incentives, and social security contributions. You need to understand these to optimize tax planning over the next few years. ([pwc.com](https://www.pwc.com/ca/en/services/tax/budgets/2026/2026-federal-spring-economic-update.html?utm_source=openai))
## What’s Changed and When It Kicks In
| Change | Effective Date | What It Means for Businesses |
|---|---|---|
| **CPP base contribution rate cut**: From 9.9% to 9.5% (shared between employer and employee) | January 1, 2027 | Lowers payroll cost; changes reporting; useful for cash flow projections. ([deloitte.com](https://www.deloitte.com/ca/en/services/tax/analysis/spring-economic-update-canadian-tax-legal-alert.html?icid=toggle_ca_en&utm_source=openai)) |
| **CCUS expanded eligibility** including Enhanced Oil Recovery (EOR)** | **Equipment acquired after April 27, 2026** | Opens new opportunities to claim credits for certain carbon capture uses. ([pwc.com](https://www.pwc.com/ca/en/services/tax/budgets/2026/2026-federal-spring-economic-update.html?utm_source=openai)) |
| **Accelerated Capital Cost Allowances for Eligible LNG Facilities** | Property acquired on or after **November 4, 2025** until 2035 | Improves asset write-offs; places importance on acquisition timing. ([deloitte.com](https://www.deloitte.com/ca/en/services/tax/analysis/spring-economic-update-canadian-tax-legal-alert.html?icid=toggle_ca_en&utm_source=openai)) |
| **Employee Ownership Trust (EOT) exemption** | Capital gains exemption stays for *dispositions from 2024 through 2026*; proposal to **make it permanent** | Enables tax-efficient exits for business owners; promotes employee ownership. ([pwc.com](https://www.pwc.com/ca/en/services/tax/budgets/2026/2026-federal-spring-economic-update.html?utm_source=openai)) |
| **Higher limits for tradespeople’s temporary relocation deduction** | For 2026 and onwards | Better relief for trades workers moving for short-term work assignments. ([deloitte.com](https://www.deloitte.com/ca/en/services/tax/analysis/spring-economic-update-canadian-tax-legal-alert.html?icid=toggle_ca_en&utm_source=openai)) |
## Actionable Strategies for Businesses
1. **Review planned asset purchases** before year end 2026, especially relating to LNG plant kit or CCUS equipment, to maximize tax advantages.
2. **Reassess exit planning** if considering selling business to employees via an EOT—locking in deals prior to year-end may secure favourable tax treatment.
3. **Budget for payroll cost changes**: With CPP rate dropping starting 2027, estimate cost savings and adjust cashflow forecasts.
4. **Check eligibility** for the expanded CCUS & EOT incentives; apply for any certifications or project approvals required early.
5. **Update accounting & compliance processes** to reflect these changes: tax filings, declarations, deductions.
## Case Example
A small public corporation operating a clean tech facility acquired capture and transportation equipment for CCUS after April 28, 2026. They can now claim the **CCUS investment tax credit (ITC)** at reduced rates for equipment used in enhanced oil recovery—not fully new territory, but now officially eligible. Combined with earlier accelerated CCA if they attached emissions requirements, this improves ROI significantly. Planning asset purchases accordingly could save hundreds of thousands in tax and depreciation costs.
## Final Thoughts
With these business tax changes, what matters most is **timing** and **understanding eligibility**. Whether you’re investing in clean tech, selling your business, or moving workforce, the way you structure your operations and transactions over the rest of 2026 will influence your tax profile for years. Partner with your tax advisor now to align strategy with new laws, and use the near term wisely while transition windows are open.