Medical Expense Tax Credit

HST combines the 5% federal GST with a provincial component in five participating provinces. For 2026 the combined rates are 13% in Ontario, 15% in New Brunswick, Newfoundland and Labrador, and Prince Edward Island, and 14% in Nova Scotia since 1 April 2025. Elsewhere you charge the 5% GST alone, or GST plus a separate provincial tax. The rate follows the province of supply, not where your business sits.

A tax deduction is an amount subtracted from your income before tax is worked out, so it reduces the income being taxed rather than the tax bill directly. Its worth depends on your marginal rate: the higher the rate, the more the deduction saves. Common examples are RRSP contributions, child care costs, union dues, moving expenses and business expenses. Credits work the other way, reducing the tax calculated on that income.

Each province sets its own top bracket, which sits on top of the federal top bracket, so the highest combined marginal rate depends on where you live, and both rates and thresholds are adjusted each year. Look up the current combined table for your province rather than relying on a single national figure. It is a marginal rate: only the income above the threshold is taxed at it, never your whole income.

Basic groceries are zero-rated, which means taxable at a nil rate, so nothing is charged on staples such as milk, bread, vegetables, meat and most unprepared food. Tax applies to what the CRA treats as outside basic groceries: restaurant and prepared meals, most snack foods, candy, carbonated and sweetened drinks, and heated or catered items. A retailer selling zero-rated groceries still claims input tax credits on its own taxable costs.