Understanding net salary in Nunavut 2026
Nunavut's payroll withholding is CRA-administered. However, 'Net Pay' in Nunavut is just the starting point; the Northern Residents Deduction (Zone A) provides a massive reduction in taxable income at year-end (approx. $11/day + travel benefits).
This page provides an educational estimate: it explains the mechanisms and gives an order of magnitude.
The calculation logic can be summarized as follows:
Annual net salary = Annual gross salary
− Federal tax
− Provincial/territorial tax
− Pension contributions (CPP/QPP)
− Employment Insurance (EI)
− QPIP (if Quebec)
Nunavut does not collect its own income tax. Instead, all personal income tax is processed by the CRA, even though territorial tax policy is locally defined.
⚠️ Keep in mind: your actual pay stub may differ depending on your credits (TD1),
taxable benefits, RRSP contributions, bonuses,
commissions, overtime, union dues, and other specifics.
2026 tax tablesCRA
Rates + K constant
In 2026, Nunavut is the undisputed champion of low taxation in Canada. To help residents cope with extreme logistical costs (food and housing), the territory imposes the lowest income tax rate in the country: only 4%.
The Basic Personal Amount is $13,664. Once this threshold is crossed, this famous 4% rate applies to all income up to $55,801. That is almost four times less provincial tax than in Quebec for the same income level.
Even for higher salaries, the tax burden remains minimal. The second bracket is only 7% (up to $111,602), and Nunavut's absolute maximum rate is only 11.5% for income exceeding $181,439.
On the pay stub, deductions are therefore mainly limited to federal tax, CPP (5.95%), and EI (1.64%). The combination of these ultra-low rates and the Northern Residents Deduction yields the highest net salary in Canada for an equivalent gross salary.
Concrete example: For a $70,000 salary in Iqaluit, your territorial marginal rate is only 7%. Combined with the federal tax, your net salary will be approximately $55,000, which is several thousand dollars more than a similar worker in the Atlantic provinces.
| Income bracket |
Rate |
K |
| 58 523 $ or less |
14 % |
0 |
| 58 523.01 $ to 117 045 $ |
20.50 % |
3 804 |
| 117 045.01 $ to 181 440 $ |
26 % |
10 241 |
| 181 440.01 $ to 258 482 $ |
29 % |
15 685 |
| 258 482.01 $ or more |
33 % |
26 024 |
| Income bracket |
Rate |
K |
| 54 345 $ or less |
14 % |
0 |
| 54 345.01 $ to 108 680 $ |
19 % |
2717 |
| 108 680.01 $ to 132 245 $ |
24 % |
8 151 |
| 132 245.01 $ or more |
25.75 % |
10 465 |
Calculations are based on 2026 Nunavut territorial tax brackets and indexed personal amounts as provided by the Department of Finance and the CRA.
Federal Basic Personal Amount (BPA) - minimum vs maximum
In Nunavut, the federal BPA reduces federal tax through a non-refundable credit applied after tax calculation.
For 2026, the BPA varies between 16,452 $ and 14,829 $, decreasing gradually as income exceeds 181,440 $. Nunavut’s territorial basic amount is 13,664 $.
-
Maximum BPA: generally applies if your net income is below the phase-out threshold. It
provides the largest credit.
-
Minimum BPA: applies to high incomes (above the upper threshold). Even at very high income,
you keep at least this credit.
-
Between the two: the BPA is reduced progressively from the maximum toward the minimum
according to a formula.
Not to be confused: each province also has its own basic personal amount, which reduces
provincial tax separately from the federal BPA.
Additional 2026 information - thresholds and rates
Nunavut’s tax brackets are very wide. You can earn a significant salary before hitting the higher tax rates, which differs from the 'quick jump' seen in Nova Scotia or Quebec.
CPP / QPP - base plan
-
Applicable range:
Pensionable earnings, generally between the annual exemption of 3 500 $ and the maximum
pensionable earnings
(YMPE) of 74 600 $.
-
Employee rate:
CPP 5.95% (outside Quebec) ·
QPP 6.30% (Quebec).
CPP2 / QPP - additional plan
-
Applicable range:
Earnings above the YMPE (74 600 $) up to the additional maximum
(AYMPE) of 85 000 $.
-
Employee rate:
4.00%.
Dynamic display: if annual salary is ≤ 74 600 $, this contribution does not apply.
EI (Employment Insurance)
-
Maximum insurable earnings:
68 900 $.
-
Employee rate:
1.63% (outside Quebec) · 1.30% (Quebec).
QPIP - parental insurance (Quebec)
-
Maximum insurable earnings:
103 000 $.
-
Employee rate:
0.430%.
This contribution applies only if the province is Quebec.
Federal Basic Personal Amount (BPA)
-
Maximum: 16 452 $ ·
Minimum: 14 829 $.
-
Non-refundable credit, phased down between 181 440 $ and 258 482 $ of annual income.
FAQ - Net Pay / Take-Home Pay in Nunavut (NU) 2026
Why is income tax so low in Nunavut (4%)?
Nunavut has the lowest personal income tax rate in Canada to offset extreme logistical costs such as food, heating, and housing. The territorial government relies more heavily on federal transfers than on personal income tax revenue.
Does the Northern Residents Deduction apply to travel benefits?
Yes. In addition to the basic residency deduction, if your Nunavut employer provides travel benefits for medical trips or vacations (often necessary due to isolation), special rules allow much of this to be treated as non-taxable.
Are there any health premiums deducted from payroll in Nunavut?
No. There are no health insurance premiums, territorial sales taxes, or surtaxes deducted from your pay. Your only standard deductions are income tax (minimal), CPP, and EI.
