How we calculate take-home pay in Canada

The order of the calculation

1. CPP: pensionable earnings are pay up to $74,600 less the $3,500 basic exemption. Base CPP is 4.95% of that and first additional CPP is 1.00%. CPP2 is 4% of pay between $74,600 and $85,000.
2. EI: 1.63% of pay up to $68,900.
3. Taxable income is salary less the first additional CPP and CPP2.
4. Federal tax is the bracket tax on taxable income less 14% of the federal basic personal amount (reduced above $181,440), the Canada employment amount, base CPP and EI. It cannot go below zero.
5. Basic provincial or territorial tax is the bracket tax less the lowest rate times the basic personal amount, base CPP and EI (and, in Yukon, the Yukon employment amount). Manitoba's basic personal amount is reduced between $200,000 and $400,000; Yukon's follows the federal one.
6. Ontario adds its surtax and health premium and takes off the Ontario tax reduction (basic amount, no dependants). BC takes off the BC tax reduction.
7. Take-home pay is salary less federal tax, provincial or territorial tax, CPP, CPP2 and EI. Monthly, semi-monthly, bi-weekly and weekly figures divide the year by 12, 24, 26 and 52.

Every result is rounded to the cent from its exact value. For 2026 we use the CRA's full-year rates and amounts, not the figures payroll uses for each half of the year in BC, Newfoundland and Labrador and PEI.

Sources

• CRA: Tax rates and income brackets for 2026; CRA: Indexation adjustment for personal income tax and benefit amounts
• CRA: T4127 Payroll Deductions Formulas, 122nd edition (January 2026); CRA: T4127 Payroll Deductions Formulas, 123rd edition (July 2026)
• CRA: CPP contribution rates, maximums and exemptions; ESDC: CPP maximum benefit amounts and related figures, 2026; CRA: The CPP enhancement, what it means for you; CRA: EI premium rates and maximums
• Finance Canada: Bill C-4 receives Royal Assent; Finance Canada: Bill C-30 passes; OSFI: 33rd Actuarial Report on the Canada Pension Plan
• Ontario: Health premium; Ontario: LIFT credit; British Columbia: Budget 2026 tax changes; Alberta: Personal income tax; Manitoba Finance: Personal income taxes; Manitoba Finance: Personal tax credits; Saskatchewan: 2026 personal income tax structure; Nova Scotia: Personal income tax rates and indexation
• Government of Canada: Current and forthcoming minimum wage rates; Ontario: Your guide to the Employment Standards Act, minimum wage; Manitoba: Minimum wage; Nova Scotia: Minimum wage; Alberta: Minimum wage; Northwest Territories: Minimum wage
• CRA: Payroll Deductions Online Calculator; CRA: Benefits and allowances chart

How we test it

The calculator is checked against six hand-worked examples, every figure the CRA's Payroll Deductions Online Calculator gave in our two cross-checks, and edge cases at each threshold and maximum, 11,298 checks in all. The version in your browser is checked against the version that writes these pages on 600 random salaries and provinces.

Worked example	Federal tax	Provincial tax	CPP and CPP2	EI	Take-home a year
Ontario $60,000	$5,338.30	$2,982.20	$3,361.75	$978.00	$47,339.75
Ontario $90,000	$11,251.60	$5,781.96	$4,646.45	$1,123.07	$67,196.92
Ontario $150,000	$25,302.14	$14,608.45	$4,646.45	$1,123.07	$104,319.89
British Columbia $75,000	$8,258.60	$3,661.32	$4,246.45	$1,123.07	$57,710.56
Alberta $80,000	$9,242.60	$4,490.38	$4,446.45	$1,123.07	$60,697.50
Nova Scotia $70,000	$7,278.19	$7,145.72	$3,956.75	$1,123.07	$50,496.27

For Ontario $60,000 and Nova Scotia $70,000, a first bi-weekly pay in the CRA's calculator times 26 matches these figures within $1 a year on income tax and CPP. The comparison.

What we could not confirm from an official source

• Prince Edward Island's 20% rate on taxable income over $200,000: the CRA applies it from 2026, but we could not confirm that the bill has received Royal Assent.
• Newfoundland and Labrador's basic personal amount: we use the CRA's 2026 figure of $13,094; the province's budget described an increase to $15,000, which payroll applies from July 2026. We could not confirm the law from the province's own pages.
• BC's 2026 budget measures (the Budget Measures Implementation Act, 2026): we take the rates from the CRA's July 2026 payroll formulas, as BC's own pages could not be read directly.
• Manitoba's thresholds: the CRA's 2026 rates page shows indexed figures ($47,564 and $101,200), while the CRA's payroll formulas and Manitoba Finance show them frozen at $47,000 and $100,000. We use the frozen figures; the difference is at most $66.80 a year.
• Alberta's basic personal amount of $22,769 comes from the CRA's payroll formulas; Alberta's own page does not list it.
• Minimum wages for BC, New Brunswick, Newfoundland and Labrador, Nunavut, PEI, Saskatchewan and Yukon come from the Government of Canada database only, and Alberta's start date is not given on its own page.

What it does not cover

Quebec; RRSP, pension plan or pooled pension contributions taken from pay; union dues; TD1 claims other than the basic personal amounts (such as spouse, dependants or disability); the Ontario tax reduction for dependants; taxable benefits; bonuses and commissions; overtime and vacation pay; more than one employer; the northern residents deduction; self-employment and other income; and credits or deductions claimed only on your tax return, such as LIFT, low-income tax reductions, medical expenses and donations.

Changelog

• 20 October 2026: rules checked for the 2026 tax year, outside Quebec.

These figures are estimates based on the 2026 federal, provincial and territorial tax rules, CPP and EI rates published by the Canada Revenue Agency and other government sources. They are general information, not tax, financial or legal advice. Your pay stub can differ, for example because of your TD1 claims, RRSP or pension deductions, union dues, taxable benefits, bonuses, how often you are paid or the point in the year. Check your pay stub, or ask your employer or the CRA, before relying on these figures.