Canadians will see some new laws and measures kick in for 2026
Several new laws and measures are slated to come into effect this year in Canada.
From laws that could affect your immigration status to measures that may change how you file your taxes in Canada this year, it’s helpful to stay up-to-date.
Here are the new laws and rules you can expect in Canada for 2026.
Federal employee Early Retirement Incentive program kicks in
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In December, the federal government began sending Early Retirement Incentive notices to tens of thousands of public service workers as part of its plan to cut costs on operations.
In an email statement to Daily Hive, a spokesperson for the President of the Treasury Board of Canada said approximately 68,000 early retirement notices have been issued to public servants.
This is a part of the government’s Early Retirement Incentive, which was announced in Budget 2025. It’s a voluntary program for public servants at age 50 or above and age 55 or above who have been working for at least 10 years, with at least two years of pensionable service. It would allow these employees to retire earlier without their pensions being penalized.
Canada is aiming to cut 40,000 public service jobs from their 2024 to 2023 peak of 368,000. By 2028 to 2029, Ottawa hopes to have reduced the number of public servants to roughly 330,000.
The government plans to implement the program on Jan. 15, or when the legislation receives Royal Assent. It added that it plans to finish the process within one year.
Canada Strong Pass extension
Canadians who weren’t able to take advantage of this program in the summer still have a chance to use it this year.
The Canada Strong Pass was such a success over the summer that the federal government announced that it’s extending the program for winter and summer 2026.
The winter extension is available until Jan. 15, so you have one more week to enjoy free and discounted access to parks, national galleries, museums, and even rail travel.
New income tax brackets
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In November, the federal government announced the income tax thresholds for 2026, which means your tax bracket will change slightly this year.
While federal tax rates are the same, the income thresholds for each bracket have shifted.
According to the Canada Revenue Agency (CRA), in 2026, the indexation increase will be two per cent, which is lower than the 2.7 per cent increase in 2025.
Check to see how much income tax you’ll have to pay this year based on your bracket.
Automatic tax filing launches
In October, Prime Minister Mark Carney announced that the Canada Revenue Agency (CRA) will automatically file taxes for millions of Canadians in the 2026 tax year.
The automated and free process will make filing taxes much easier for low-income Canadians. Those eligible for automatic tax filing will only need to provide a few details and confirm their information in a pre-filled tax form from the CRA.
This year, the CRA will prepare pre-filled tax returns online for approximately one million lower-income individuals with simple tax situations. The CRA plans to scale up this initiative to 5.5 million people for the 2028 tax year.
Cutting international student permits
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In November, the Government of Canada revealed that one way it’s tightening immigration policies is to dramatically cut the number of international student permits in half.
It will be more challenging for international students to get visas to study in Canada, according to the report that outlines the country’s new immigration plan.
Last year, the government had planned to issue 305,900 student permits in 2026 and 305,900 in 2027. However, projected numbers will see those drop by more than half, with the government planning to reduce the number of new student permits issued to 155,000 in 2026 and 150,000 in 2027. It also plans to issue only 150,000 study permits in 2028.
“We are taking back control over immigration in Canada and putting Canada back on a trajectory to bring immigration back to sustainable levels, allowing us to fulfil the promise of Canada to those who call it home,” Minister of Finance François-Philippe Champagne stated in November.
The Canadian government revealed how international student permits will be allocated under the new cap in December. Check to see which provinces will accept the most international students this year.
New Express Entry immigration category
In December, Ottawa announced new measures to fill “critical labour gaps” in Canada’s health-care system by making the path to permanent residence simpler for international doctors.
Immigration, Refugees and Citizenship Canada (IRCC) is creating a new Express Entry category for international doctors with at least one year of Canadian work experience in an eligible occupation, gained within the last three years.
The government explained that these doctors are already working in Canada and contributing to the country’s health-care system on a temporary basis. The new Express Entry category will provide international doctors with a clear pathway to permanent residence and fill gaps in the health-care workforce.
According to the IRCC, invitations to apply to this new category will be issued in early 2026.
New Canadian citizenship rule in place
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Crucial legislation came into effect in December that will make it easier for more people to get Canadian citizenship next year.
After receiving royal assent on Nov. 20, Bill C-3, an Act to amend the Citizenship Act, officially kicked in on Monday, Dec. 15. Also known as the “Lost Canadians” legislation, the new law will extend Canadian citizenship by descent beyond the first generation.
Learn more about who’s eligible and how to apply.
Tax rebate for first-time homebuyers expected to kick in
Last year, the federal government announced that it would eliminate the federal five per cent GST on home prices for first-time homebuyers in the form of the First-Time Home Buyers’ GST Rebate.
For first-time buyers only, there will be zero GST applied on new homes sold at up to $1 million. For new properties bought at a price of between $1 million and $1.5 million, there will be a reduced GST for first-time buyers and their new homes.
This means that for homes priced at up to $1 million, first-time buyers will save up to $50,000 by not having to pay the GST. Buyers with new, more expensive homes will be eligible for a reduced GST rebate, which falls incrementally from home prices of $1 million to $1.5 million.
For example, a home price of $1.1 million would be eligible for a 20 per cent rebate of $40,000, a home price of $1.25 million would be eligible for a rebate of $25,000, and a home price of $1.4 million would be eligible for a rebate of $10,000.
The legislation has been tabled, and if it receives Royal Assent, it could kick in this year.
NSF fee cap on Canadian banks
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Ottawa is implementing a cap on Canadian banks’ non-sufficient funds (NSF) fees this year.
Starting March 12, 2026, banks won’t be able to charge more than $10 if someone doesn’t have enough money in their personal deposit account to cover a payment to be drawn from that account. Banks will only be able to change one NSF fee per account within a two-business-day period.
“Non-sufficient funds (NSF) fees are charged by banks when there are insufficient funds in a bank account to cover a cheque or pre-authorized debit (PAD) and the consumer does not have overdraft protection,” reads a government notice from March 2025. “They typically range from $45 to $48 and represent a source of financial hardship for consumers.”