While today’s much-awaited – and much delayed –

federal budget

didn’t have a big focus on

tax measures

, here’s a review of five tax changes that may impact you, as well as one highly-anticipated measure that was not in the budget.

Top-up tax credit

There were no further changes to individual tax rates for 2025, but the budget did introduce a new top-up tax credit, which aims to fix a problem associated with the recent reduction in the lowest bracket as it relates to the value of non-refundable tax credits.

The rate applied to most non-refundable tax credits is based on the first marginal personal income tax rate. When the lower tax bracket was reduced to 14.5 per cent as of July 1, the value of most non-refundable credits also decreased.

In very rare cases where an individual’s non-refundable tax credit amounts exceed the first income tax bracket threshold ($57,375 in 2025), the decrease in the value of these credits may exceed their tax savings from the rate reduction. This might happen in situations where an individual claims a large one-time expense, such as amounts for high tuition or medical expenses, or claims a combination of large non-refundable tax credits. In some cases, these claims are for both themselves and a dependant, and could also include amounts carried forward from previous years, such as the tuition credit, which has an unlimited carryforward period.

To ensure that no taxpayer in this circumstance has their tax liability increased as opposed to decreased by the middle-class tax cut, the budget proposed a new non-refundable top-up tax credit which would effectively maintain the current 15 per cent rate for non-refundable tax credits claimed on amounts in excess of the first income tax bracket threshold.

Home accessibility tax credit (HATC)

The HATC is a non-refundable tax credit that applies at the lowest personal income tax rate on up to $20,000 of eligible home renovation or alteration expenses per calendar year. Expenses eligible for the HATC must be incurred to improve the safety, accessibility or functionality of an eligible dwelling of a qualifying individual aged 65 or older, or a taxpayer eligible for the disability tax credit.

The medical expense tax credit (METC) is a non-refundable tax credit that applies at the lowest personal income tax rate on the amount of qualifying medical and disability-related expenses in excess of the lesser of $2,834 (for 2025) and three per cent of the taxpayer’s net income. METC eligible expenses include certain costs to build or renovate a home to improve access or mobility for individuals with disabilities.

Under the current rules, if the eligibility criteria for both credits are met, taxpayers can effectively double-dip by claiming both credits for the same expense. Today’s budget proposes to end this, such that an expense claimed under the METC cannot also be claimed under the HATC, effective for the 2026 tax year, making Dec. 31 the deadline if you want to claim both credits for the same expense.

Cancellation of the Canadian Entrepreneurs’ incentive

If you’re a business owner hoping to take advantage of the new Canadian Entrepreneurs’ Incentive (CEI) on the sale of your business, you’re out of luck. The CEI, which was introduced in last year’s federal budget, would have further reduced the tax rate on up to $2 million of capital gains over an individual’s lifetime on the sale of a qualifying business. The lifetime limit was to be phased in by increments of $400,000 per year, beginning on Jan. 1, 2025, before ultimately reaching a value of $2 million by Jan. 1, 2029. This measure would have applied in addition to the lifetime capital gains exemption, which was recently enhanced to $1.25 million.

The budget announced the government’s intention to cancel the CEI in light of its decision earlier this year not to proceed with the proposed increase to the capital gains inclusion rate.

Cancellation of the Underused Housing Tax

The Underused Housing Tax (UHT) came into effect on Jan. 1, 2022, and applies to certain owners of vacant or underused residential property in Canada, who were, for the most part, non-resident, non-Canadians. The UHT is currently imposed on an annual basis at a rate of one per cent on the value of the property.

The federal budget proposed to eliminate the UHT as of the 2025 calendar year. As a result, no UHT would be payable and no UHT returns would be required to be filed for 2025 and subsequent calendar years.

Cancellation of the luxury tax on boats and airplanes

If you’ve been holding off on buying that luxury boat or airplane, your wait is over, as the luxury tax is being repealed on boats and airplanes as of Nov. 5.

Readers may recall that in 2022 the federal government introduced a luxury tax on vehicles and airplanes with a value above $100,000, and boats with a value above $250,000. The luxury tax is equal to the lesser of 10 per cent of the total value of the item, and 20 per cent of the value above the relevant threshold. The tax is generally imposed on sales, imports and leases of high-value vehicles, airplanes, and boats.

No changes to RRIF minimums

Finally, retirees holding their breath for a relaxation of the registered retirement income fund (RRIF) required minimums might as well give up, at least for now. You’ll recall that in the run-up to the election, the Liberals promised to “protect retirement savings” by reducing the minimum amount that must be withdrawn from a RRIF by 25 per cent for one year. This measure was designed to “allow Canadian seniors more flexibility in choosing when to draw from their retirement savings.”

The requirement to withdraw a minimum annual amount, whether you need it or not, is one of the biggest concerns voiced by some seniors when it comes to retirement planning since it effectively forces them to pay tax on their retirement assets before they need to spend them. Experts say that the RRIF rules haven’t kept up with recent demographic and economic trends.

Jamie Golombek, FCPA, FCA, CFP, CLU, TEP is the Managing Director, Tax & Estate Planning with CIBC Private Wealth in Toronto.