Understanding net salary in Ontario 2026
Ontario payroll withholding includes layers specific to the province. Notably, the Ontario Health Premium is deducted directly from pay for those earning over a certain threshold, and the Ontario Surtax applies to provincial tax payable above specific amounts.
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)
Ontario does not maintain a separate tax collection body for personal income tax. Both federal and provincial amounts are collected by the CRA under a unified payroll process.
⚠️ 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
Ontario has one of the most complex tax systems in Canada in 2026, due to its provincial surtax and the Ontario Health Premium, which are added to the regular income tax deducted at the source.
The Basic Personal Amount is $12,989. The base tax rate is very low, set at 5.05% on income up to $53,891. However, once base tax exceeds certain thresholds, a surtax of 20% and then 36% applies, significantly increasing the effective rate.
The Ontario Health Premium is another important line on your pay stub. It is deducted automatically and can range from $0 (for low incomes) up to $900 per year for salaries exceeding $200,000.
Regular brackets beyond $53,891 increase to 9.15% (up to $107,785) and then progressively rise to 13.16% for income over $220,000.
Concrete example: With a $100,000 salary in Toronto, your combined marginal tax rate will be around 43%. After the Health Premium, CPP, EI, and income taxes, your net salary will be approximately $72,000.
Tip: Because of the Ontario surtax, earning over $107,000 pushes your marginal rate over 43%. Contributing to an RRSP at this level is highly recommended. [Try our RRSP Calculator].
| 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 |
We use the official CRA T4032 payroll deduction tables which incorporate Ontario's brackets, basic personal amounts, surtax parameters, and health premium thresholds.
Federal Basic Personal Amount (BPA) - minimum vs maximum
In Ontario, the federal Basic Personal Amount is a non-refundable credit that reduces net federal tax rather than adjusting gross income. Its monetary value is obtained by applying the lowest federal tax rate to the BPA.
The BPA is not fixed for all taxpayers: in 2026 it is 16,452 $ for low to mid incomes and gradually declines to 14,829 $ for higher incomes between 181,440 $ and 258,482 $. Ontario’s provincial basic amount is 12,989 $.
-
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
Variable income (like bonuses) can cause Ontario withholding to spike. Since payroll formulas annualize your income, a large bonus might trigger higher Surtax or Health Premium tiers for that specific pay period.
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 Ontario (ON) 2026
What is the Ontario Health Premium (OHP) deduction on my paycheque?
The Ontario Health Premium is a mandatory statutory deduction used to fund the healthcare system. Unlike federal income tax, it is not a fixed percentage. It operates on a sliding scale: it is $0 for low-income earners and can reach up to $900 per year for salaries over $200,000.
How does the Ontario surtax affect my take-home pay?
Ontario applies a 'tax on tax' called the surtax. In 2026, once your base provincial tax exceeds certain thresholds, you pay an additional 20%, and then 36% on the excess. This significantly reduces the net income of professionals and executives earning over $100,000.
Can I ask my employer to reduce my tax withholdings?
Yes, if you regularly contribute to an RRSP or have significant childcare expenses. You must complete the CRA Form T1213. Once approved, your employer will reduce the tax withheld from your pay, increasing your immediate take-home pay.
