Canadian pay guide
How Canadian income tax brackets work
Canadian income tax uses progressive federal and provincial or territorial brackets. Moving into a higher bracket does not mean all of your income is taxed at the higher rate.
In short
Each tax rate generally applies only to the portion of taxable income within that bracket. Your province of employment also affects payroll tax withholding and your final annual tax calculation.
Federal and provincial tax
Employees can pay both federal income tax and income tax set by their province or territory. The rates and thresholds are not identical, which is why two employees on the same salary can have different take-home pay in different provinces.
Tax credits and payroll
Payroll calculations use basic personal credits and information from TD1 forms, but a real tax return can also include deductions and credits that are not reflected in a simple salary estimate.
Why a payslip can differ
CPP, EI, Québec QPP and QPIP, benefit deductions, bonuses and pay frequency can all change a particular payment. An annual calculator is best used as a planning baseline.
Use the Canada take-home pay calculator for a supported provincial estimate. It is not tax advice; use CRA information or a qualified professional for your own return.