Canadian Tax Calculator
Estimate your Canadian federal and provincial income taxes, CPP contributions, and EI premiums.
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Understanding Canadian Income Tax
Canada uses a progressive tax system where both the federal government and your province or territory levy income taxes. Your total tax is the sum of federal and provincial taxes, calculated on tax brackets.
2024 Federal Tax Brackets
- 15% on the first $55,867 of taxable income
- 20.5% on income from $55,867 to $111,733
- 26% on income from $111,733 to $173,205
- 29% on income from $173,205 to $246,752
- 33% on income over $246,752
Provincial Taxes
Each province and territory has its own tax brackets and rates. Alberta has the lowest provincial rates (10% flat rate up to $148,269), while Quebec has the highest combined rates.
Frequently Asked Questions
How are Canadian income taxes calculated?
Canadian income tax is calculated using a progressive tax system with both federal and provincial/territorial components. You pay different rates on different portions of your income based on tax brackets. The basic personal amount is deducted before calculating tax.
What is the difference between marginal and effective tax rate?
Your marginal tax rate is the rate you pay on your next dollar of income (the highest bracket you fall into). Your effective tax rate is your total tax divided by total income - it represents your average tax rate across all brackets.
How much can I contribute to my RRSP?
Your RRSP contribution limit is 18% of your previous year earned income, up to the annual maximum ($31,560 for 2024). Any unused contribution room carries forward. RRSP contributions reduce your taxable income dollar-for-dollar.
What are CPP and EI contributions?
CPP (Canada Pension Plan) provides retirement income and is mandatory for most workers. In 2024, employees contribute 5.95% on earnings between $3,500 and $68,500. EI (Employment Insurance) provides benefits if you lose your job, with employees paying 1.66% on earnings up to $63,200.