Dividend Tax 

Credit Rate

2

Amount of Dividend 

Received Tax Free

Actual

Dividend

Taxable

Dividend

Actual

Dividend

Taxable

Dividend

Federal

3

 16.67%

13.33%

$ 43,430

$ 54,288

British Columbia 

4.25

3.40

25,058

31,323

Alberta

4.38

3.50

21,652

27,065

Saskatchewan

5.00

4.00

19,163

23,954

Manitoba

4

2.19

1.75

9,439

11,799

Ontario

5.63

4.50

40,139

50,174

Québec

10.00

8.00

22,390

27,988

New Brunswick 

6.63

5.30

21,697

27,121

Nova Scotia 

9.63

7.70

28,339

35,424

Prince Edward Island

5

3.63

2.90

11,656

14,570

Newfoundland and Labrador

6.25

5.00

19,280

24,100

Non-Eligible Dividend Tax Credit Rates and Amount of Dividends 

that may be Received Without Incurring Tax in 2013

1

Notes

(1) This table assumes only “non-eligible dividend” income is earned and takes into account 

all federal and provincial taxes, surtaxes, and alternative minimum taxes, but does not 

include provincial premiums (see the table “Provincial Health Premiums”). The respective 

basic personal and dividend tax credits and provincial tax reductions, where applicable, are 

also included.

“Non-eligible” dividends are those that are not subject to the dividend rules applying 

to “eligible” dividends (see the table “Eligible Dividend Tax Credit Rates and Amount of 

Dividends that may be Received Without Incurring Tax in 2013”). The gross-up rate for 

non-eligible dividends is 25%. The actual amount received is therefore multiplied by 1.25 to 

determine the taxable amount of the dividend.

(2) The federal and provincial dividend tax credit (DTC) rates in the table’s first column apply 

to the actual amount of the dividend received by an individual. The DTC rate can also be 

expressed as a percentage of the taxable dividend, as indicated in the table’s second 

column.

(3)  The federal gross-up on non-eligible dividends paid after 2013 will decrease to 18% (from 

25%) and the corresponding dividend tax credit will decrease to 11% (from 13.33%).  

Accordingly, the federal effective tax rate on non-eligible dividends paid after 2013 will 

increase. 

(4) In response to the federal change to the gross-up of non-eligible dividends (see Note (3)), 

Manitoba’s dividend tax credit rate will decrease from 1.75% to 0.83% beginning in 2014.  

This decrease will effectively result in the same amount of provincial tax payable on non-

eligible dividend income earned before and after the federal change.

(5) P.E.I. increased its dividend tax credit rate on non-eligible dividends to 2.9% (from 1%) of 

the taxable amount of the dividend effective January 1, 2013.

/  37

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Current as of September 30, 2013