Understanding Claim Codes (0 Through 10)

When your employer processes your TD1, payroll software converts your total personal tax credits into a claim code — a number from 0 to 10 (or sometimes higher). This claim code is what actually appears on your pay stub and drives the withholding calculation. Understanding claim codes helps you verify that your employer processed your TD1 correctly.

Claim Code	Meaning	Approximate Federal Credit Range (2026)
0	No credits claimed. Maximum tax withheld. Used when you request additional withholding or have multiple employers.	$0
1	Basic personal amount only — the default if you submit a blank TD1.	$16,129
2	Basic personal amount plus a small additional credit (e.g., age amount, pension income amount).	$16,130 – $18,129
3	Credits totalling between $18,130 and $20,129.	$18,130 – $20,129
4	Credits totalling between $20,130 and $22,129.	$20,130 – $22,129
5	Credits totalling between $22,130 and $26,129.	$22,130 – $26,129
6	Credits totalling between $26,130 and $30,129.	$26,130 – $30,129
7	Credits totalling between $30,130 and $34,129.	$30,130 – $34,129
8	Credits totalling between $34,130 and $38,129.	$34,130 – $38,129
9	Credits totalling between $38,130 and $42,129.	$38,130 – $42,129
10	Credits totalling $42,130 or more — highest standard code.	$42,130+

How to check: Look at your pay stub. There is usually a line labelled "Federal Claim Code" and "Provincial Claim Code." If you claimed only the basic personal amount, you should see Claim Code 1. If you claimed the basic personal amount plus the full spousal amount, your total credits would be approximately $32,258 ($16,129 + $16,129), which would place you at Claim Code 7. If your pay stub shows Claim Code 1 but you submitted a TD1 with spousal credits, your employer may not have processed the form — follow up with payroll immediately.

Every Line of the 2026 Federal TD1, Explained

Line 1 — Basic Personal Amount: $16,129

Every person who is a resident of Canada for tax purposes can claim the basic personal amount (BPA). For the 2026 tax year, the federal BPA is $16,129. This means the first $16,129 of your annual income is effectively tax-free at the federal level. The lowest federal tax rate is 15%, so this credit saves you approximately $2,419 in federal tax per year ($16,129 x 15%).

Always claim this amount unless you earn income from more than one source simultaneously (e.g., two jobs) and have already claimed it with another employer.

Part-year residents: If you immigrated to Canada partway through 2026, you are still entitled to claim the full basic personal amount on your TD1 — you do not need to prorate it for the number of days you were resident. The proration, if applicable, happens when you file your annual T1 tax return. For TD1 purposes, the CRA instructs you to enter the full amount. This surprises many newcomers who assume they should claim a partial amount.

Line 2 — Spouse or Common-Law Partner Amount

If your spouse or common-law partner lives with you in Canada and earns less than the basic personal amount ($16,129 in 2026), you can claim a credit for the difference. The calculation is:

Spouse amount = $16,129 minus your spouse's estimated 2026 net income

For example, if your spouse has zero income, you claim the full $16,129. If your spouse earns $5,000, you claim $16,129 - $5,000 = $11,129. If your spouse earns $16,129 or more, you claim $0.

This is one of the most valuable credits for newcomer families. A newcomer earning $55,000 per year with a non-working spouse who claims the full spousal amount will see their total federal credits jump from $16,129 to $32,258 — moving from Claim Code 1 to approximately Claim Code 7. The practical impact: roughly $200 more per month in take-home pay.

Common-law partners count. In Canada, if you have lived with a partner in a conjugal relationship for 12 continuous months, they are your common-law partner for tax purposes, even without a marriage certificate. Many newcomers do not realize this.

Line 3 — Amount for an Eligible Dependant

This credit is sometimes called the "equivalent-to-spouse" amount because it is worth the same dollar value as the spousal credit on Line 2. You can claim it if all of these conditions are true:

• You do not have a spouse or common-law partner (or if you do, you are not living with them and not supporting them).
• You support a dependant who lives with you — typically a child under 18, but it can also be a parent, grandparent, or other relative who is dependent on you due to a mental or physical infirmity.
• The dependant's net income is below the basic personal amount ($16,129).

The calculation mirrors Line 2: $16,129 minus the dependant's estimated income. You cannot claim both the spousal amount (Line 2) and the eligible dependant amount (Line 3). It is one or the other. Single parents typically benefit most from this credit.

Line 4 — Canada Caregiver Amount for Eligible Dependant or Spouse

The Canada Caregiver Amount provides an additional credit if your spouse, common-law partner, or eligible dependant (claimed on Line 2 or Line 3) has a physical or mental impairment. This is an add-on to the spousal or dependant credit, not a replacement.

For 2026, the additional caregiver amount for an infirm dependant or spouse is approximately $2,616 federally. To claim this, the dependant must have a condition that is expected to last at least 12 months and that limits their ability to care for themselves. You do not necessarily need a T2201 Disability Tax Credit certificate for this specific line, but you should have documentation from a medical practitioner.

Line 5 — Canada Caregiver Amount for Dependant(s) Age 18 or Older

This is a separate caregiver credit for situations where you support a dependant who is 18 or older and has a physical or mental impairment — but whom you did not claim on Line 3 or Line 4. A common example: you are married (so you claimed your spouse on Line 2), but you also support an elderly parent who lives with you and has a medical condition. The maximum amount for 2026 is approximately $8,375, reduced by the dependant's net income above a threshold (around $19,666).

Line 6 — Disability Amount

If you yourself have a severe and prolonged physical or mental impairment, and the CRA has approved your Form T2201 (Disability Tax Credit Certificate), you can claim the federal disability amount — approximately $9,872 in 2026. This is a significant credit. However, you must have the T2201 approved before claiming this on the TD1. Getting T2201 approval can take several months, so plan ahead.

Line 7 — Pension Income Amount

If you receive eligible pension income — including payments from a foreign pension plan — you can claim up to $2,000 on this line. This is relevant for newcomers who are receiving retirement income from their home country while working in Canada. Note: CPP and OAS payments do not count as eligible pension income for this credit.

Line 8 — Tuition Amount (Full-Time and Part-Time)

If you are enrolled at a designated educational institution in Canada (a university, college, or other qualifying school), you can claim the tuition fees you paid for the current year. There is no dollar cap on this line — enter whatever tuition you paid. Many newcomers who are attending LINC (Language Instruction for Newcomers to Canada) classes wonder if those fees qualify. LINC classes are free, so there is nothing to claim, but if you are paying tuition at a college or university, include it here.

International students attending university in Canada on a study permit can also claim tuition on the TD1 if they have employment income.

Line 9 — Disability Amount Transferred from a Dependant

If your spouse or dependant qualifies for the disability amount (has an approved T2201) but does not need the full credit to reduce their own tax to zero, the unused portion can be transferred to you. Enter the transferable amount on this line.

Line 10 — Canada Caregiver Amount for an Infirm Child Under 18

If you have a child under 18 who has a physical or mental infirmity, you can claim approximately $2,616 per infirm child for 2026. This is separate from the regular dependant credits and does not require an approved T2201.

Line 11 — Amounts Transferred from Spouse or Dependant

If your spouse or dependant has unused credits — for example, they have tuition credits or age amount credits that exceed their own tax liability — the excess can be transferred to you. Calculate this using the worksheet on the back of the TD1 form and enter the result here.

Line 12 — Total Claim Amount

Add up all the amounts from Lines 1 through 11. This total determines your claim code and how much tax your employer withholds.

Real Dollar Examples: How the TD1 Affects Your Paycheque

These examples assume biweekly pay (26 pay periods per year), employment in Ontario, and 2026 federal and Ontario tax rates.

Example 1: Single newcomer, no dependants, earning $50,000/year

Scenario	Federal Credits Claimed	Approx. Federal Tax Withheld Per Pay	Approx. Take-Home Per Pay (After All Deductions)
TD1 with basic personal amount only (Claim Code 1)	$16,129	$197	$1,486

This is the baseline. Since this person has no additional credits, Claim Code 1 is correct.

Example 2: Married newcomer, non-working spouse, earning $55,000/year

Scenario	Federal Credits Claimed	Approx. Federal Tax Withheld Per Pay	Approx. Take-Home Per Pay
TD1 with only basic personal amount (Claim Code 1) — spouse NOT claimed	$16,129	$235	$1,580
TD1 with basic + full spousal amount (Claim Code 7)	$32,258	$142	$1,673

Difference: approximately $93 more per paycheque, or $2,418 more per year in take-home pay. This is money you are entitled to — it is not a bonus or a trick. You are simply telling your employer about credits that reduce your tax obligation.

Example 3: Single parent newcomer, one child age 5, earning $48,000/year

Scenario	Federal Credits Claimed	Approx. Federal Tax Withheld Per Pay	Approx. Take-Home Per Pay
Basic personal amount only	$16,129	$183	$1,422
Basic + eligible dependant amount	$32,258	$90	$1,515

Difference: approximately $93 more per paycheque, or $2,418 per year. For a single parent on a tight budget, that is grocery money, transit passes, or childcare costs.

Example 4: Newcomer student working part-time, $8,000 tuition paid

Scenario	Federal Credits Claimed	Effect
Basic personal amount only	$16,129	Standard withholding
Basic + tuition amount	$24,129	Reduced withholding — approximately $46 less tax per biweekly pay, or $1,200 per year

The Provincial TD1: Different Numbers, Same Process

The provincial TD1 works identically to the federal one, but the dollar amounts are different because each province sets its own tax credits. Here are the 2026 basic personal amounts for the most common provinces newcomers settle in:

Province	Provincial Form	Approx. 2026 Basic Personal Amount
Ontario	TD1ON	$11,865
British Columbia	TD1BC	$12,580
Alberta	TD1AB	$21,003
Manitoba	TD1MB	$15,780
Saskatchewan	TD1SK	$18,491
Nova Scotia	TD1NS	$8,744

Notice the wide variation. Alberta's basic personal amount is nearly double Nova Scotia's. This is why you need to complete the provincial form separately — the federal numbers do not apply at the provincial level.

The provincial form has the same types of credits (spousal, dependant, caregiver, disability, tuition) but with province-specific dollar values. Fill it out following the same logic as the federal TD1.

When to Submit or Update Your TD1

You should submit (or resubmit) a TD1 to your employer in any of these situations:

• When you start a new job. This is the most common trigger. Your employer should give you both the federal and provincial TD1 as part of onboarding.
• When your personal situation changes mid-year. Got married? Your spouse started or stopped working? Had a baby? A dependant moved in or out? Submit a new TD1 — the updated withholding applies from the next pay period.
• At the start of each calendar year if credit amounts have changed (the CRA adjusts them for inflation annually). Most employers do not require you to resubmit if nothing changed, but it is good practice to review your claim code on your first January pay stub.
• When you realize you made a mistake. You can submit a corrected TD1 at any time. There is no penalty for updating it.

What Happens If You Don't Submit a TD1?

If you do not submit a TD1 at all, your employer is required by CRA regulations to withhold tax as if you claimed only the basic personal amount (Claim Code 1). You will not be penalized, but you will lose the benefit of any additional credits until you file your annual tax return and receive a refund.

For someone with a non-working spouse, this means approximately $200 per month less in take-home pay for the entire year — money that could have been in your pocket all along.

Common Newcomer Mistakes on the TD1

Mistake 1: Not claiming the spousal amount

This is the number one mistake. If your spouse is not working or earns below $16,129, you should claim Line 2. Many newcomers are unsure or afraid of making an error, so they leave it blank. The result: overpaying tax by $150 to $200 per month.

Mistake 2: Claiming credits with multiple employers

If you work two jobs, you should claim your full personal credits with only one employer (typically the higher-paying job). With the second employer, you should either claim Claim Code 0 (no credits) or only the basic personal amount. Claiming full credits at both jobs means not enough tax is withheld overall, and you will owe money when you file your return — possibly with interest.

Mistake 3: Forgetting the provincial form

Many newcomers complete the federal TD1 but never submit the provincial one. This means the employer uses default provincial withholding, which may be higher than necessary.

Mistake 4: Using last year's form

Credit amounts change every year due to inflation indexing. The 2025 basic personal amount was different from 2026, and provincial amounts shift year over year. Always download the current year's form from the CRA website.

Mistake 5: Confusing the TD1 with the tax return

The TD1 does not replace your annual T1 income tax return. It only affects withholding. You still need to file a tax return by April 30 of the following year. Credits that are not on the TD1 — such as RRSP deductions, medical expenses, charitable donations, and childcare expenses — are claimed on your annual return.

Mistake 6: Not knowing about the eligible dependant amount

Single parents often miss Line 3 entirely. If you are raising a child alone in Canada, this credit is worth as much as the spousal amount and can save you over $2,400 per year in federal tax withholding.

What Happens If You Claim Too Much?

If you claim credits on the TD1 that you are not entitled to — for example, claiming a spousal amount when your spouse actually earns above the threshold — the consequence is straightforward: not enough tax will be withheld from your pay during the year, and when you file your annual tax return, you will owe the difference. The CRA will send you a Notice of Assessment showing the balance owing.

There is generally no penalty for an honest mistake on a TD1. The CRA understands that life situations change. However, if you intentionally and knowingly claim false credits to reduce withholding, the CRA can impose penalties. For newcomers acting in good faith, this is almost never an issue.

If you realize mid-year that you overclaimed, simply submit a corrected TD1 to your employer. You can also ask your employer to withhold additional tax (there is a line on the back of the TD1 for this) to make up the shortfall before year-end.

How to Fix a TD1 You Already Submitted

Fixing a TD1 is simple:

1. Download a fresh copy of the current year's federal TD1 and provincial TD1 from the CRA website.
2. Fill in the corrected information. There is no "amendment" form — you simply complete a new TD1 with the correct amounts.
3. Submit both forms to your employer's payroll department. The new TD1 replaces the old one. Your employer will adjust withholding starting from the next pay period.
4. Check your next pay stub to confirm the new claim code is reflected.

There is no deadline for submitting a correction. You can do it any time during the year. However, the adjustment only applies going forward — your employer will not retroactively refund over-withheld tax from earlier pay periods. You will recover that money when you file your annual tax return.

If You Have More Than One Employer

This situation is common for newcomers who work multiple part-time jobs. The rule is clear:

• Primary employer (highest income): Claim all your credits as normal.
• Second employer: Submit a TD1 with Claim Code 0 — or at most, the basic personal amount only. On the back of the federal TD1, check the box that says "More than one employer or payer at the same time" and enter $0 for your claim amount.

Why? Because your personal tax credits can only be applied once across all your income. If both employers apply the full basic personal amount, your total withholding will be lower than your actual tax bill, and you will owe money at tax time.

Additional Tax Withholding (Back of the TD1)

The back page of the TD1 contains a section where you can request that your employer withhold additional tax from each paycheque. This is useful if:

• You have other sources of income (rental income, freelance work, investment income) that are not subject to payroll withholding.
• You want to avoid a tax bill at year-end.
• You have two jobs and want to ensure enough tax is withheld overall.

Simply enter the additional amount per pay period (e.g., $50 per pay) on the back of the form. This gives you more control over your tax situation.

Step-by-Step: Filling Out the TD1 for 2026

1. Download both forms. Go to the CRA website and search for "TD1" or navigate to canada.ca/td1. Download the 2026 federal TD1 and the 2026 provincial TD1 for the province where you work (not necessarily where you live, if they differ).
2. Fill in your personal information. Name, address, date of birth, Social Insurance Number (SIN). If you do not yet have a SIN, your employer should still give you the form — you can add the SIN later once it arrives.
3. Line 1 — Basic personal amount. Enter $16,129 (the amount is pre-printed on the form). Claim this unless you have told another employer to use your credits.
4. Lines 2 through 11. Read each line. If a credit applies to your situation, enter the amount using the calculation described on the form. If it does not apply, leave it blank or enter $0.
5. Line 12 — Total. Add up all amounts from Lines 1 through 11.
6. Back page. If you have more than one employer, check the applicable box. If you want additional tax withheld, enter the per-pay amount.
7. Sign and date the form.
8. Repeat for the provincial TD1 using the provincial credit amounts.
9. Submit both completed forms to your employer's payroll or HR department.

What NOT to Claim on a TD1

The TD1 is only for non-refundable personal tax credits. The following common deductions and credits are not claimed on the TD1 — they are claimed on your annual T1 tax return instead:

• RRSP contributions — these are deductions, not tax credits, and are claimed when you file your return.
• Charitable donations — claimed on your annual return. However, if you make regular donations and want to reduce withholding, you can submit a CRA Form T1213 (Request to Reduce Tax Deductions at Source) instead.
• Medical expenses — claimed on your annual return.
• Childcare expenses — claimed on your annual return.
• Moving expenses — if you moved to Canada for work, these may be deductible on your return but not on the TD1.
• Canada Child Benefit (CCB) — this is a separate benefit paid directly to you by the CRA; it has nothing to do with the TD1.

Frequently Asked Questions

I started working in Canada partway through the year. Do I prorate my basic personal amount on the TD1?

No — on the TD1 itself, claim the full basic personal amount ($16,129). The CRA's instructions for the TD1 direct you to enter the full amount regardless of when you arrived. Any proration for part-year residency is handled on your annual tax return (T1). Many newcomers incorrectly prorate on the TD1, which results in excess withholding.

My spouse has not worked since we arrived in Canada. Can I claim the spousal amount?

Yes. If your spouse or common-law partner lives with you in Canada and has no income (or income below $16,129), you can and should claim the spousal amount on Line 2 of the federal TD1. Estimate their income for the full year — if they will start working later, estimate accordingly. You can always submit a corrected TD1 later if their income changes.

Is the TD1 the same as a tax return?

No. The TD1 is a form you give to your employer to guide payroll withholding. Your annual tax return (T1 General) is what you file with the CRA by April 30 to calculate your actual tax owing for the year. The TD1 is an estimate; the T1 is the final calculation.

Can my employer refuse to process my TD1?

No. Your employer is legally required to accept and process your TD1. If payroll refuses or delays, escalate to HR or contact the CRA directly.

I am on a work permit, not a permanent resident. Can I still claim credits?

Yes. Tax credits are based on tax residency, not immigration status. If you are living and working in Canada, you are generally a tax resident and can claim all credits you are eligible for. Work permit holders, international students with jobs, and permanent residents are all treated the same way on the TD1.

Where can I get the TD1 form?

From your employer's HR or payroll department, or directly from the CRA website at canada.ca/td1. Always use the current year's version — forms are updated annually with new credit amounts.

I already submitted my TD1 months ago with the wrong information. Is it too late to fix?

No. You can submit a corrected TD1 at any time during the year. The updated withholding will apply from the next pay period. Any tax that was over-withheld earlier in the year will be refunded to you when you file your annual tax return.

Free Help With Your TD1 and Canadian Taxes

If you are unsure about any line on the TD1, you have several free options:

• Community Volunteer Income Tax Program (CVITP): Free tax clinics staffed by trained volunteers who help people with modest incomes file their taxes. Many CVITP clinics also help with TD1 forms. Search "free tax clinic near me" on canada.ca.
• Settlement agencies: Many immigrant-serving organizations offer tax workshops and one-on-one help during tax season.
• CRA phone line: Call 1-800-959-8281 for individual tax inquiries. Wait times can be long, but the agents can answer TD1 questions.
• WelcomeAide: The WelcomeAide AI assistant can explain any line of the TD1 in your language, help you estimate your credits, walk you through filling out the form, and connect you to free tax clinics in your area. Try it now — available 24/7, completely free.

The TD1 is a small form with a big impact on your daily life in Canada. Taking 15 minutes to fill it out correctly can put thousands of extra dollars in your pocket over the course of a year. Do not leave money on the table — claim every credit you are entitled to.