The New Brunswick low-income tax reduction lowers or eliminates the provincial income tax owed by residents whose adjusted family income falls below a set threshold. For the 2025 tax year, a single filer with adjusted income up to $21,920 can potentially owe zero provincial tax, and the threshold rises to roughly $22,358 for 2026 due to annual indexation. The reduction is non-refundable, so it can bring your provincial tax bill to zero but will not generate a refund on its own.
Who Qualifies
The core requirement is residency: you must be a resident of New Brunswick on December 31 of the tax year.1Canada Revenue Agency. Your Province or Territory of Residence The reduction itself is set out in the New Brunswick Income Tax Act.2Government of New Brunswick. New Brunswick Income Tax Act
If you have a spouse or common-law partner, your combined family income determines the reduction. Under Canadian tax law, a common-law partner is someone you have lived with in a conjugal relationship for at least 12 consecutive months. The eligibility question comes down to whether your adjusted family income sits below the phase-out ceiling.
How Much the Reduction Is Worth
The reduction begins with a base amount and can grow depending on your household. For the 2025 tax year, the spouse or common-law partner addition is $802, and the eligible dependant addition is also $802.3Canada Revenue Agency. New Brunswick Tax Information for 2025 These amounts are indexed annually.
A detail that catches people out: you can claim the $802 for a spouse or the $802 for an eligible dependant on the same return, but not both. The eligible dependant amount applies when you claimed a credit on line 30400 of your federal return and did not claim the spouse reduction.3Canada Revenue Agency. New Brunswick Tax Information for 2025
The Phase-Out
Once your adjusted family income crosses the threshold, the reduction shrinks. For 2025, that threshold is $21,920 for a single filer. For every dollar of income above the threshold, the reduction decreases by 3 percent, and the clawback continues until the credit is exhausted.4Finance and Treasury Board. Personal Income Tax The 3 percent rate has been in place since 2017.
Households claiming the spouse or eligible dependant addition start with a larger total reduction, so their credit survives to a somewhat higher income level before washing out.
Transferring Unused Reduction to a Spouse
If your provincial tax is already zero and you still have reduction left over, your spouse or common-law partner can claim that unused amount on their own return. The transfer is calculated on lines 88 to 90 of your Form NB428 and entered on line 68 of your spouse’s NB428.3Canada Revenue Agency. New Brunswick Tax Information for 2025 Couples where one partner has little or no income should watch for this step; skipping it means leaving provincial tax savings unclaimed.
Calculating Adjusted Family Income
The reduction uses adjusted family income, not gross income or taxable income. You calculate this figure on lines 70 to 75 of Form NB428, drawing from both your net income and your spouse’s or common-law partner’s net income.3Canada Revenue Agency. New Brunswick Tax Information for 2025 The starting point is the net income figure from line 23600 of each partner’s federal T1 return.5Canada Revenue Agency. Line 23600 – Net Income
Both partners need their federal returns worked out, at least to the line 23600 stage, before either person can finish the provincial reduction worksheet. Tax software normally handles this automatically. Filing on paper, keep your partner’s line 23600 figure in front of you before starting Form NB428.
How to Claim the Reduction
The reduction is calculated directly on Form NB428 (New Brunswick Tax and Credits), which is part of the standard New Brunswick income tax package.6Canada Revenue Agency. 5004-C NB428 – New Brunswick Tax and Credits There is no separate application. The form is available through the CRA website or any certified tax software.7Canada Revenue Agency. New Brunswick – 2025 Income Tax Package
Most people file electronically using NETFILE-certified software, which sends the return directly to the CRA.8Canada.ca. NETFILE – Tax Software for Filing Personal Taxes After processing, the CRA issues a Notice of Assessment confirming whether the reduction was applied and stating your final balance owing or refund.9Canada Revenue Agency. Notices of Assessment – NOA or NOR – Personal Income Tax If the CRA’s figures differ from yours, the Notice of Assessment explains what changed. Keep a copy for other benefit applications or a later CRA review.
Filing Deadlines and Late Penalties
For the 2025 tax year, the filing deadline is April 30, 2026. If you or your spouse is self-employed, the return itself is due June 15, 2026, but any tax owing is still due by April 30.10Canada.ca. Due Dates and Payment Dates – Personal Income Tax Interest starts accumulating on any unpaid balance the day after.
If you owe tax and file late, the CRA charges a penalty of 5 percent of your balance owing, plus 1 percent for each full month the return is late, up to 12 months. Repeat late filers who were penalized in a recent prior year and received a formal demand to file face 10 percent of the balance owing plus 2 percent per month, up to 20 months.11Canada Revenue Agency. Interest and Penalties on Late Taxes Even if you expect the reduction to zero out your provincial bill, filing on time keeps other income-tested benefits like the GST/HST credit and Canada Child Benefit on schedule, since those rely on your filed return.
Not the Same as the Seniors’ Benefit
New Brunswick also runs a separate Low-Income Seniors’ Benefit, which is $629 per household for 2026 and requires recipients to have received the Guaranteed Income Supplement, the Federal Allowance, or the Allowance for the Survivor during the prior year. That benefit is applied for through Service New Brunswick and will not appear on your tax return automatically; the deadline for the 2026 payment is December 31, 2026.12Government of New Brunswick. New Brunswick Low Income Seniors Benefit If you qualify for both, you claim the tax reduction on Form NB428 and apply for the seniors’ benefit separately.