Income Tax Rates-Canada

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  • The starting rate of Federal income tax is 15%, and this rises to 29% for income over $136,270 (2014).

  • Provincial rates vary, and this rate needs to be added on to the Federal rate above.

  • Canada has a reputation of being a high tax country, but in recent years rates have become more competitive internationally.

  • Here are some websites that you can use to find out income tax rates in different provinces:
    • Tax Tips Canada gives a good summary of combined rates by province.
    • Ernst & Young has a quick and easy calculator for combined federal and provincial income tax.
    • Canada Revenue Agency's web page is here.

  • As a very rough guide - for instance, if are trying to decide if a job offers a livable wage - assume that tax and other payroll withholdings will take 30% of your gross pay in normal earnings ranges.

  • See the wiki article on tax credits, which reduce the effective rate of tax people pay.

  • This is one of a series of articles on Taxation.