Published 16 Jun 2026
BC Budget 2026: The Tax Changes That Could Affect Your Take-Home Pay
From a higher bottom income-tax rate to new PST on services, here's what British Columbians should factor into their plans.
On February 17, 2026, the B.C. government announced a series of tax changes in Budget 2026. Several of them touch everyday household finances directly.
Income tax goes up at the bottom bracket
Effective for the 2026 tax year, B.C.'s lowest personal income tax rate rises from 5.06% to 5.60%, applying to the first $50,363 of taxable income. The change shows up on paycheques after July 1, 2026, when payroll withholdings update. To soften the impact, the basic personal amount and other basic non-refundable credits also move to 5.60%, and the maximum B.C. tax reduction credit increases by $115 to $690.
Tax brackets are frozen for several years
Indexation of personal income tax brackets and non-refundable credits is paused at 2026 levels for the 2027 through 2030 tax years, resuming in 2031. In practice, as incomes rise with inflation, more income can be taxed at higher rates — sometimes called bracket creep.
New PST on services arrives October 1, 2026
Provincial sales tax will newly apply to a range of professional services, including accounting and bookkeeping, architectural, engineering, and certain real estate and security services. PST exemptions are also being removed on items like fabric and sewing supplies, clothing-repair services, basic cable, and residential landline phone service.
Homeowners and higher-value properties
The $200 northern and rural homeowner benefit is repealed from 2027 (the regular homeowner grant stays at $570), and additional school tax rates rise on residential properties valued over $3 million.
What this means for your plan
Most B.C. earners will see a modest bump in income tax starting mid-2026, and certain expenses will edge up once PST expands in October. These are small individually but add up across a year. Updating your income and expense lines in AffordaFlow now lets you see the combined effect on your cash flow before the changes take hold.
Source: Province of British Columbia — Budget 2026 tax changes