How income tax works in Canada
Canada uses progressive tax brackets. Each slice of income is taxed at its own rate, then non-refundable credits reduce the final amount owing.
Income & Salary
Salary After Tax Calculator
Estimate Canadian take-home pay after federal tax, provincial tax, CPP, and EI deductions.
Basics
Federal vs provincial taxes
Most employees pay both federal and provincial or territorial income tax. Quebec administers its own provincial income tax system.
CPP and EI explained
CPP and EI are payroll deductions that fund public pensions and employment insurance. They have annual maximums.
Why your paycheck is smaller than your salary
Your gross salary is reduced by taxes and payroll deductions before your employer deposits your pay.
Frequently asked questions
Is this exact payroll advice?+
No. It is a simplified estimate and does not include every credit, benefit, pension plan, or payroll adjustment.
Does it include CPP2?+
Yes, the simplified CPP estimate includes the second additional CPP range above the YMPE.