How Canadian Pay Deductions Work
Every Canadian paycheque has the same four pieces taken out. Only the provincial piece changes from place to place.
- Federal income tax. Set by Ottawa and collected by the Canada Revenue Agency (CRA) for everyone.
- Provincial or territorial income tax. Each government sets its own brackets and credits. CRA collects it with the federal tax, except in Quebec, where Revenu Québec runs a separate system.
- Canada Pension Plan (CPP). A contribution toward your public pension. Quebec workers pay into the Quebec Pension Plan (QPP) instead.
- Employment Insurance (EI). A premium that funds benefits if you lose your job or take parental leave. Quebec workers pay a lower EI rate plus a premium to the Quebec Parental Insurance Plan (QPIP).
Ontario adds one more line, the Ontario Health Premium, which is collected through the tax system.
Federal Tax Brackets for 2026
The lowest federal rate fell from 15% to 14%. The cut started in mid 2025, when the rate for that year was set at 14.5%, and 2026 is the first full year at 14%.
| Taxable income | Federal rate |
|---|---|
| Up to $58,523 | 14% |
| $58,523 to $117,045 | 20.5% |
| $117,045 to $181,440 | 26% |
| $181,440 to $258,482 | 29% |
| Over $258,482 | 33% |
Two credits shrink the bill for nearly every employee. The basic personal amount of $16,452 is tax free; it slides down to $14,829 once net income passes $181,440. The Canada employment amount adds a credit on the first $1,501 of job income. Both credits, and the credit for CPP and EI, are worth 14% of the amount.
CPP, EI and QPP in 2026
These contributions are capped, so they stop once you reach the yearly maximum.
| Contribution | Employee rate | Earnings covered | Maximum a year |
|---|---|---|---|
| CPP | 5.95% | $3,500 to $74,600 | $4,230.45 |
| CPP2 (second tier) | 4% | $74,600 to $85,000 | $416 |
| EI | 1.63% | Up to $68,900 | $1,123.07 |
| QPP (Quebec) | 6.3% | $3,500 to $74,600 | $4,479.30 |
| EI (Quebec rate) | 1.3% | Up to $68,900 | $895.70 |
| QPIP (Quebec) | 0.43% | Up to $103,000 | $442.90 |
The first $3,500 of a year's pay is exempt from CPP. The base part of CPP (4.95%) earns a tax credit. The extra 1% and all of CPP2 are deducted from taxable income instead, which is why the calculator's taxable income sits a little below gross pay.
Worked Example: $80,000 in Ontario
A single Ontario employee earning $80,000 with no other income:
| Item | Per year | Per month |
|---|---|---|
| Gross salary | $80,000 | $6,666.67 |
| Federal income tax | −$9,242.60 | −$770.22 |
| Ontario income tax | −$4,135.26 | −$344.60 |
| Ontario Health Premium | −$750 | −$62.50 |
| CPP | −$4,230.45 | −$352.54 |
| CPP2 | −$216 | −$18 |
| EI | −$1,123.07 | −$93.59 |
| Take home pay | $60,302.63 | $5,025.22 |
CPP reaches its ceiling at $74,600 of pay and CPP2 picks up the next $5,400. EI is already at its $1,123.07 cap. Taken together, deductions use 24.6% of gross pay.
Take Home Pay on $70,000 in Every Province
Same salary, same federal tax rules, 13 different results. Rows are sorted from the highest net pay to the lowest.
| Province or territory | Provincial tax | Net per year | Net per month |
|---|---|---|---|
| Nunavut | $2,216.47 | $55,425.53 | $4,618.79 |
| Northwest Territories | $3,197.57 | $54,444.42 | $4,537.04 |
| Yukon | $3,287.01 | $54,354.98 | $4,529.58 |
| British Columbia | $3,293.85 | $54,348.15 | $4,529.01 |
| Alberta | $3,534.79 | $54,107.20 | $4,508.93 |
| Ontario | $3,855.73 | $53,786.27 | $4,482.19 |
| Saskatchewan | $4,972.67 | $52,669.32 | $4,389.11 |
| New Brunswick | $5,600.17 | $52,041.82 | $4,336.82 |
| Manitoba | $5,742.67 | $51,899.32 | $4,324.94 |
| Newfoundland and Labrador | $5,938.98 | $51,703.01 | $4,308.58 |
| Prince Edward Island | $6,258.09 | $51,383.90 | $4,281.99 |
| Quebec | $7,527.62 | $51,044.71 | $4,253.73 |
| Nova Scotia | $7,145.72 | $50,496.27 | $4,208.02 |
The Ontario figure includes the Health Premium. Quebec has lower federal tax because of its abatement but a heavier provincial bill, as its own page explains.
Province Gross to Net Calculators
Each of these pages fixes the province and explains its own rules, worked examples and tax table:
- Ontario: five brackets, a surtax and the Health Premium.
- Alberta: the highest basic personal amount among the provinces and an 8% first bracket.
- British Columbia: seven brackets and a lowest rate that rose for 2026.
- Manitoba: brackets frozen at 2025 levels.
- New Brunswick: four brackets indexed by 2%.
- Quebec: its own tax return, QPP and QPIP.
- Saskatchewan: a basic personal amount rising by $500 a year.
Newfoundland and Labrador, Nova Scotia, Prince Edward Island and the three territories are covered by the selector at the top of this page.
Paycheque by Pay Schedule
Here is the $80,000 Ontario salary from the worked example, split across the four usual pay schedules:
| Pay schedule | Gross per pay | Net per pay |
|---|---|---|
| Weekly (52) | $1,538.46 | $1,159.67 |
| Every two weeks (26) | $3,076.92 | $2,319.33 |
| Twice a month (24) | $3,333.33 | $2,512.61 |
| Monthly (12) | $6,666.67 | $5,025.22 |
Because EI and CPP stop once their caps are reached, the last paycheques of the year can be slightly larger than these averages for higher earners.
What Counts as Taxable Pay
- Taxed: salary, wages, overtime, bonuses, commissions, vacation pay and most taxable benefits.
- Reduces taxable income: RRSP contributions made through payroll, registered pension plan contributions and union dues. This calculator assumes none.
- Not taxed: genuine reimbursements of business expenses you paid for your employer.
- Bonuses use the same tax rates, but payroll withholds them with a separate method, so a bonus cheque can look heavily taxed.
Assumptions and Sources
- A full year with one employer, salary as the only income, and only the basic personal amounts claimed.
- Credits paid through the tax return, such as the GST/HST credit or provincial low income reductions, are left out.
- The figures are annual tax, worked with the CRA payroll formulas over a single pay period. Your actual withholding can differ by a few dollars.
- For an official check, the Government of Canada's Payroll Deductions Online Calculator (PDOC) gives per paycheque figures.
Sources: Canada Revenue Agency, T4127 Payroll Deductions Formulas (122nd edition, January 2026, and 123rd edition, July 2026); Finances Québec, Parameters of the personal income tax system for 2026; Revenu Québec; Statistics Canada for the typical salary. Rates for 2026.
Frequently Asked Questions
Is this the Government of Canada gross to net calculator?
No. The Government of Canada tool is CRA's Payroll Deductions Online Calculator (PDOC), which works per paycheque. This calculator uses the same CRA formulas but shows the whole year at once.
What is the lowest federal tax rate in 2026?
14% on taxable income up to $58,523, down from 15% before the cut.
How much is take home pay on $70,000 in Canada?
It depends on the province. In 2026 it ranges from $50,496.27 in Nova Scotia to $55,425.53 in Nunavut. Ontario is $53,786.27.
What is the maximum CPP contribution for 2026?
$4,230.45 for the main CPP, plus up to $416 of CPP2 on earnings between $74,600 and $85,000.
What is the EI rate for 2026?
1.63% of insurable earnings up to $68,900, a maximum of $1,123.07. In Quebec it is 1.3%.
Why is my real paycheque different?
Payroll spreads tax evenly over the year and may include RRSP, pension, union dues or benefit deductions. Check your TD1 forms and pay stub for those lines.
Does the calculator cover the territories?
Yes. The selector includes Yukon, the Northwest Territories and Nunavut with their 2026 brackets and basic personal amounts.