Income Tax Calculator

How Canadian income tax actually works

Canada uses marginal brackets at two levels — federal and provincial — stacked on the same income. Only the income inside each bracket is taxed at that bracket's rate. The federal brackets for 2026:

• 14% on the first $58,523
• 20.5% from $58,523 to $117,045
• 26% from $117,045 to $181,440
• 29% from $181,440 to $258,482
• 33% above $258,482

Then your province adds its own brackets on top. Everyone also gets the basic personal amount — $16,452 federally in 2026, trimmed for incomes in the top two brackets — meaning the first slice of income is effectively tax-free.

CPP and EI: the other deductions

Payroll deductions aren't income tax but they hit the same paycheque: CPP at 5.95% of earnings between $3,500 and $74,600 (max $4,230), plus the CPP2 layer of 4% on earnings from $74,600 to $85,000 (max $416). EI at 1.63% of the first $68,900 (max $1,123). Quebec runs its own versions (QPP at 6.3%, lower EI, and a 16.5% abatement of federal tax) — all handled in the provincial calculations above.

Why your marginal rate is the useful number

Decisions happen at the margin. A raise, overtime, freelance income, or RRSP contribution is all priced at your marginal rate — the combined federal + provincial rate on your next dollar. At $70,000 in Ontario that's about 29.7%, so a $10,000 RRSP contribution returns ~$2,960 (a little less than $10,000 × the marginal rate when the deduction dips into a lower bracket). Try entering a contribution above and watch the savings line — that's the mechanic behind every "RRSP season" ad you see each February, and the input to our RRSP vs TFSA calculator.

What this estimator includes (and doesn't)

Included: 2026 federal and all provincial/territorial brackets, basic personal amounts (with the federal, Yukon and Manitoba high-income reductions), Ontario surtax and Health Premium, CPP/CPP2, EI, Quebec's federal abatement. Not included: the Canada employment amount, Canada Workers Benefit, QPIP, tuition/medical/donation credits, pension splitting, or investment-income treatment. For a plain employee paycheque it's typically within a percent or two of reality; for anything more complex, it's a planning tool — not filing software.