CANADA, February 26 - Changes to personal income tax rates that came into effect January 1, 2025, will help Islanders keep an estimated $20 million of their money this calendar year alone.

“We're listening to Islanders who are asking for relief to help ease the cost of living.This is the sixth consecutive annual increase to provincial income tax thresholds, resulting in savings for those individuals and families who need it most. The basic personal amount has increased 55% and the age amount for our seniors has increased by 73% since 2019.”

- Finance Minister Jill Burridge

Island families with children began receiving the first installment of the PEI Child Benefit in January. This new monthly benefit provides up to $360 per year per child to help qualifying Islanders with the costs of raising children. Other tax changes came into effect this year including increases to the following:

• basic personal amount to $14,250  
• spousal and equivalent amount to $12,103  
• age credit amount and income threshold to $6,510 and $36,600, respectively  
• income threshold for the low-income tax reduction by another $750 to $22,250

Compared to 2024, a family of two adults and two children with a combined income of $140,000 will save an additional $368 on their 2025 tax return. This same family will save an extra $1,680 in 2025 as compared to their 2019 tax return.

These changes were announced in the 2024 provincial operating budget with amendments to the Income Tax Act approved by the PEI Legislative Assembly during the fall sitting.  

                

Media contact:
Janice Fogarty
Department of Finance
jefogarty@gov.pe.ca