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Personal income tax rates in Canada are stacked in two sets. In 2026 Ottawa charges between 14% and 33%, and Ontario stacks its own 5.05% to 13.16% beside that. Nobody pays the top rate on everything.
A rate touches only the income that sits inside its own bracket.
What are the federal income tax brackets for 2026?
The CRA lowered the first federal rate to 14% for 2026 and indexed the thresholds by 2.0%. Here’s the federal table as the CRA prints it on its 2026 tax rates and income brackets page.
| 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% |
What are the Ontario rates?
Ontario has its own five brackets, and you pay them in addition to the federal ones. The thresholds are different, so your income can be in the second federal bracket and still in the first Ontario one.
| Taxable income | Ontario rate |
|---|---|
| Up to $53,891 | 5.05% |
| $53,891 to $107,785 | 9.15% |
| $107,785 to $150,000 | 11.16% |
| $150,000 to $220,000 | 12.16% |
| Over $220,000 | 13.16% |
On top of that Ontario charges a health premium, which tops out at $900 once taxable income is above $200,600. It’s a separate line on your return, not a rate. The calculators also apply an Ontario surtax, which for 2026 is 20% of basic provincial tax over $5,818, plus another 36% of basic tax over $7,446.
What does a rate mean for the tax on my paycheque?
Take income under $53,891 in Ontario. The first-bracket rates add up to 19.05%, which is 14% plus 5.05%. That’s the tax on your next dollar before credits and the health premium, and it’s a lot less than what people mean when they say they’re “in the 30% bracket”.
The rate on your next dollar is your marginal rate. What you pay on all your income divided by that income is your average rate, and it’s always lower. Our marginal tax rate calculator shows the first one. Be careful with it near $200,000 in Ontario, where the health premium step can make the reading jump higher than the bracket table suggests.
Does a raise ever leave you with less money?
No, and this is the most common worry. Say Mei in Sudbury earns $58,000 of taxable income and gets a $1,000 raise. Only the $477 above $58,523 is taxed at the 20.5% federal rate instead of 14%. The extra federal tax compared with staying in the lower bracket is about $31. The rest of that $1,000 is taxed at the same rate as before, and the whole raise still lands mostly in her pocket.
Moving up a bracket never reaches back and re-taxes the income below it. That’s the single idea behind this whole page.
How much tax is that on $60,000, $100,000 and $150,000?
These are the income tax calculator results for employment income in Ontario, using the 2026 basic amounts and credits. Income tax only, before CPP and EI.
| Employment income | Federal tax | Ontario tax | Total | Average rate |
|---|---|---|---|---|
| $60,000 | $5,338 | $2,982 | $8,320 | 13.9% |
| $100,000 | $13,302 | $6,723 | $20,024 | 20.0% |
| $150,000 | $25,302 | $14,608 | $39,911 | 26.6% |
Look at the gap between the last two rows. The pay is $50,000 higher, and the tax is almost $20,000 higher. That’s a progressive system doing its job.
How do the brackets add up on $100,000?
Walk through the federal side by hand. The first $58,523 is taxed at 14%, which is $8,193. The remaining $41,477 is taxed at 20.5%, which is $8,503. That’s $16,696 before credits.
The calculator’s federal figure is $13,302, and the difference is credits, starting with the basic personal amount. Ontario’s side works the same way with its own brackets and credits. So the bracket table gives you the shape of the tax, and the credits move the total down.
What do these rates leave out?
Quite a bit.
Both tables run on taxable income, so RRSP deductions and similar claims come off first, and after that credits reduce the tax, which is why two people on the same salary can end up with different bills. Our tax credits calculator only covers the federal ones. Dividends and capital gains follow different rules, which we cover in our page on investment income tax.
Live outside Ontario and the second table doesn’t apply to you. Quebec also works differently, with its own return. And if you spot a figure here that disagrees with the CRA page, trust the CRA page.
Where the numbers come from
Federal and Ontario brackets are from the Canada Revenue Agency‘s 2026 tax rates and income brackets page, read on 30 September 2026 and again in October. The health premium is from the Ontario government’s health premium page. The tax examples are results from this site’s calculators, which are estimates. We aren’t a government service and we don’t speak for one.
Frequently asked questions
What are the federal income tax rates for 2026?
14% up to $58,523, 20.5% to $117,045, 26% to $181,440, 29% to $258,482 and 33% above that.
What are Ontario's income tax rates for 2026?
5.05% up to $53,891, 9.15% to $107,785, 11.16% to $150,000, 12.16% to $220,000 and 13.16% above.
Is the whole income taxed at the top rate?
No. Each rate applies only to the part of your income inside its bracket.
What is the Ontario health premium?
A charge on your Ontario return that rises with income to a maximum of $900 when taxable income is over $200,600.
Why is my average rate lower than my bracket?
Your first dollars are taxed at the lowest rates, and credits cut the tax further, so the average is always below the top rate you reach.
- How Canadian income tax works: brackets and credits
How federal and provincial Canadian income tax stack up, what marginal and average rates mean, and how credits and deductions change your bill