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The best Ontario tax tips are the boring ones: know which bracket your next dollar lands in, use deductions where the rate is highest, and keep paper for what you claim. On an $85,000 salary, a $5,000 RRSP deduction cuts Ontario and federal tax from $15,551 to $14,069, a $1,482 saving.
What are the Ontario tax brackets in 2026?
Ontario has five provincial brackets. They’re added to the federal ones, so your combined rate on the next dollar is the two together.
| 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% |
Two extra charges aren’t in the table: Ontario’s surtax, which hits people with a larger provincial bill, and the health premium below. Our calculator includes both.
What is the Ontario Health Premium?
A yearly charge with a floor of $0 for taxable income up to $20,000 and a ceiling of $900 once you pass $200,600. Most people never see it, because it’s taken from pay along with income tax. Ontario’s own page says it isn’t linked to OHIP and doesn’t change your right to care.
The premium goes up in steps, and that’s why the tax on your next dollar can look odd near certain incomes. Our marginal rate tool shows a spike close to $200,000. That’s the premium climbing through its last band, and a real cost of earning there, not a bug in your return. The marginal tax rate calculator lets you test any income you like.
Which Ontario tax tips save the most money?
Start with the RRSP, because the saving is easy to see. At $85,000, the $5,000 deduction above saves about 30 cents per dollar put in. At lower incomes the saving per dollar is smaller. Try both in the RRSP calculator before you decide how much to put in.
Next, claim what you’re allowed. Medical costs, donations and child care each have their own rules, and our credits tool handles the federal side. It doesn’t include Ontario credits, so it won’t give you the whole picture.
If you’re saving for a first home or growing money tax-free, weigh the FHSA against the TFSA with the tools here. Current contribution limits weren’t confirmed on an official page for this text, so look up the CRA’s figures before you put money in.
Tips if you work for yourself
Keep every receipt and a clean record of income. Working for yourself means covering the employer’s half of CPP as well, and the calculator for the self-employed shows the total. Be careful with it: deductions lower income tax there but not CPP, and the tool leaves out EI, so its number is a floor, not the final bill.
The CRA says to keep records for six years from the end of the last tax year they relate to, unless you have permission to destroy them sooner. It also says they should be kept at your Canadian home or business address.
Mistakes people make in Ontario
Comparing your salary to a bracket instead of your taxable income is the classic one. So is assuming a big refund means you did well (it means you overpaid all year). Some people forget the health premium when a side income pushes them up a band. If you have large income with no tax taken off, look at the tax instalments calculator too.
And don’t treat any calculator, ours included, as a filing. It’s an estimate built on basic credits.
Where the numbers come from
Ontario and federal rates are from the CRA’s 2026 rate page. The health premium is from ontario.ca, updated January 2026. Record-keeping rules are from the CRA’s Keeping Records guide. The worked figures are our own calculator runs. This site has no link with the CRA or the Ontario government.
Frequently asked questions
What is the lowest Ontario tax rate?
5.05% on taxable income up to $53,891 in 2026.
How much is the Ontario Health Premium?
It goes from $0 at $20,000 of taxable income or less to $900 above $200,600.
Does the health premium affect my OHIP coverage?
No. Ontario says the premium is not linked to OHIP and doesn't affect eligibility for care.
How long should I keep tax records?
The CRA says six years from the end of the last tax year they relate to, unless it gives permission to destroy them earlier.
Does an RRSP deduction really save tax in Ontario?
Yes. On an $85,000 salary, a $5,000 deduction lowers combined tax by $1,482 in our estimate.
- 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
- Ontario income tax and sales tax in 2026
How Ontario income tax works in 2026: the five brackets, the surtax and health premium, the 13% HST, and the calculators that switch to Ontario
Information only. This page is general information, not tax, legal or accounting advice. Tax-Services.ca is an independent publisher: we don't prepare or file tax returns or offer tax services, and we have no connection with the CRA, Revenu Québec, any government or any company named on this page. Check the figures that matter with an official source or a qualified professional.