Take-Home Pay Calculator
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How can I calculate my take-home pay in Canada?
You can quickly calculate your net salary, or take-home pay, using the calculator above. Just enter your annual pre-tax salary. This tool will estimate both your take-home pay and income taxes paid per year, month and day.
How is take-home pay calculated?
Take-home pay in Canada is calculated by taking your pre-tax salary and subtracting federal and provincial taxes.
Employers may deduct Canada Pension Plan/Quebec Pension Plan (CPP/QPP) contributions, Employment Insurance (EI) and Provincial Parental Insurance Plan/Quebec Parental Insurance Plan (PPIP/QPIP) premiums from an employee's paycheck.
Good to know
Net salary = Gross salary - federal taxes - provincial taxes - CPP - EI - PPIP
What is net salary?
Net salary is commonly-known as take-home pay. In simple terms, it is your gross salary minus federal and provincial taxes, Employment Insurance (EI) and Canada Pension Plan/Quebec Pension Plan contributions.
Quebec also includes Provincial Parental Insurance Plan Deductions (for its Quebec Parental Insurance Plan).
For example, suppose an engineer in Ontario makes $80,000 in gross salary. She is left with $59,556 for herself after removing $10,822 for federal taxes, $5,567 for provincial taxes, and $4,056 for CPP and EI contributions.
This is what her annual earnings would look like:
|Salary before taxes||$80,000|
Why calculate my net salary?
Calculating your net salary allows you to project your actual take-home pay rather than the number before income taxes are removed. Knowing your net salary is useful for:
- Comparing different employment offers
- Asking your current employer for a raise
- Negotiating your salary during a job interview
- Budgeting your monthly budget
- Knowing how much you can afford towards rent, mortgage or other regular payments
What taxes and charges are deducted from gross salary?
You can probably remember your first paycheck. There was a shocking discrepancy between the pre-tax and the take-home numbers. Federal and provincial income taxes, Employment Insurance and the Canadian Pension Plan take a significant percentage.
What is Employment Insurance?
Employment Insurance (EI) provides temporary financial assistance to people unable to work due to:
- Unemployment (loss of their previous job without fault)
- Parental benefits
- Caring for an ill family member
You contribute to Employment Insurance monthly. If you are unemployed or stopped from working for the above reasons, it provides you with a temporary income.
What is the Canada Pension Plan?
The Canada Pension Plan (CPP) is Canada’s contributory, earnings-based social insurance program. You will contribute to it throughout your career. In retirement, this program will provide you with a regular income. It also provides disability benefits and death and survivors benefits.
Good to know
Note that Quebec runs its own program called the Quebec Pension Plan (QPP). If you live there, you will pay into the QPP rather than the CPP.
What is the Provincial Parental Insurance Plan?
The Provincial Parental Insurance Plan (PPIP) refers to a mandatory social insurance program that funds parental leave for parents of newborn or adopted children. They are administered at the provincial level. Quebec is the only province that currently does so. Its program is called the Quebec Parental Insurance Plan. You will only pay this if you live in Quebec.
This generous benefit pays parents a percentage of their income while taking time off to care for their new child.
QPIP deductions in 2022 are 0.494% of an employee’s salary up to $88,000 for a maximum premium of $434.72. Employers were required to contribute 0.692% of the same $88,000, for a maximum of $608.96.
More information about these benefits is available in the PDF below: https://www.rqap.gouv.qc.ca/sites/default/files/documents/publications/RQAP_Brochure_en.pdf
Good to know
While PPIP deductions are recognized by the Canadian Revenue Agency, Quebec is the only province that currently operates a program.
What is the average salary in Canada?
Nationally, the average salary in Canada in 2018 for full and part-time workers over the age of 15 years old was $26.92 per hour. The average full-time worker made $58 289.40
What are the tax rates on gross salary?
Tax rates are a function of how much you earn and where. You will owe both federal and provincial taxes.
Here are the current federal tax brackets and marginal rates:
|Annual income||$0 |
The current provincial tax brackets and rates in Canada's four most-populous provinces follow:
Alberta’s 2022 provincial tax brackets
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British Columbia’s 2022 provincial tax brackets
Ontario’s 2022 provincial tax brackets
Quebec’s 2022 provincial tax brackets
What is the average salary by the level of education?
Higher educational attainment usually corresponds with a higher average salary. While this is still true today, the so-called wage premium is dropping. More workers complete post-secondary education. In fact, in 2017, 68 percent of Canadians between 25 and 64 had completed some type of post-secondary education.
Average salary by educational attainment
|Level of education||Average annual salary|
|No degree or diploma||$26,824|
|High school diploma (secondary)||$35,017|
|Apprenticeship or trades certificate||$47,651|
|College, CEGEP, or non-university diploma||$47,256|
|University diploma below a bachelor's||$50,157|
|University diploma bachelor's or higher||$69,418|
What is the average salary by industry?
In 2020 salaried employees earned the following hourly rates.
|NAICS industry category||Average hourly rate|
|Forestry, logging and support||$36.92|
|Mining, quarrying, and oil and gas extraction||$62.32|
|Service producing industries||$38.35|
|Transportation and warehousing||$35.15|
|Finance and insurance||$40.95|
|Real estate and rental and leasing||$33.29|
|Professional, scientific and technical services||$41.91|
|Administrative and support, waste management and remediation services||$35.32|
|Health care and social assistance||$32.52|
|Arts, entertainment and recreation||$32.71|
|Accommodation and food services||$24.19|
What is the minimum wage in Canada?
Federally, there is no minimum wage in Canada. Each province or territory is responsible for setting its own. New Brunswick has the lowest minimum wage in Canada at $11.75 per hour. Nunavut has the highest at $16.00.
Minimum wage by province
|Province or territory||hourly minimum wage|
|Newfoundland and Labrador||$12.75|
|Prince Edward Island||$13.00|
Across Canada, there are a few exceptions to these wage minimums that apply to tipped workers or students. For example, tipped workers in Quebec have a minimum wage of $10.80 per hour.
Why does the gross net salary not list British Columbia?
You can calculate your take-home pay for British Columbia using our dedicated calculator.
Have a nice day,
The HelloSafe team