Low income in Canada is measured using the Low Income Measure (LIM), which helps define the financial threshold below which individuals or families are considered to be in low-income situations. These cut-offs are based on community size, and the thresholds vary across rural areas, census agglomerations (CA), and census metropolitan areas (CMA).
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Here’s an updated look at the Low Income Cut-Offs (before tax) for 2022, broken down by family size and community type:
Low Income Cut-Offs Before Tax
| Size of Family Unit | Rural Areas (fewer than 30,000 inhabitants) | Census Agglomeration (30,000 to 99,999 inhabitants) | Census Metropolitan Area (100,000 to 499,999 inhabitants) | Census Metropolitan Area (500,000 inhabitants or more) |
|---|---|---|---|---|
| 1 person | $20,225 | $23,009 | $25,146 | $25,303 |
| 2 persons | $25,178 | $28,643 | $31,304 | $31,498 |
| 3 persons | $30,953 | $35,213 | $38,484 | $38,723 |
| 4 persons | $37,582 | $42,755 | $46,726 | $47,016 |
| 5 persons | $42,624 | $48,492 | $52,996 | $53,323 |
| 6 persons | $48,074 | $54,691 | $59,771 | $60,142 |
| 7 persons or more | $53,523 | $60,890 | $66,546 | $66,958 |
How are Low Income Cut-Offs Determined?
These low-income cut-offs are calculated before tax, meaning they represent the income level below which individuals or families are considered to have limited financial resources. The thresholds are adjusted for family size, meaning larger families have higher income cut-offs.
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Key Takeaways:
- Urban vs. Rural: People living in larger cities or metropolitan areas tend to have higher low-income thresholds compared to those living in rural areas.
- Family Size Matters: The larger the family, the higher the income required to avoid being classified as low-income.
- Increased Costs in Large Cities: The thresholds for families in urban areas are generally higher due to the increased cost of living.
The low-income cut-offs for 2025 provide a useful tool for understanding financial challenges faced by individuals and families in various communities across Canada. Whether in rural areas or major urban centers, knowing these cut-offs can help individuals and policymakers better assess the economic realities of different populations. Keep in mind, these thresholds may adjust slightly for 2025, so it’s important to consult official updates from Statistics Canada for the latest information.
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