Canada Revenue Agency Payroll Calculator
Estimate your net pay by calculating common deductions like Canada Pension Plan (CPP), Employment Insurance (EI), and Federal and Provincial income taxes. This calculator provides an estimate based on 2024 rates for Ontario residents.
Weekly Bi-weekly Semi-monthly Monthly
Ontario
Estimated Payroll Breakdown (per Pay Period)
Gross Pay (Annualized):
CPP Deduction:
EI Deduction:
Federal Tax:
Provincial Tax (ON):
Total Deductions:
Net Pay:
Understanding Your Canadian Pay Stub: A Guide to CRA Payroll Deductions
Navigating your pay stub in Canada can sometimes feel like deciphering a complex code. Beyond your gross earnings, several mandatory deductions are withheld by your employer on behalf of the Canada Revenue Agency (CRA). These deductions fund essential social programs and government services. Understanding them is key to managing your personal finances.
Gross Pay: Your Starting Point
Gross pay is the total amount of money you earn before any deductions are taken off. This is typically based on your hourly wage or annual salary, multiplied by your pay frequency (e.g., weekly, bi-weekly, monthly). It's the foundation upon which all other calculations are made.
Canada Pension Plan (CPP) Contributions
The Canada Pension Plan (CPP) is a mandatory social insurance program that provides contributors with retirement, disability, and survivor benefits. Both employees and employers contribute to the CPP. Your contribution is calculated based on your pensionable earnings, up to a maximum annual amount. There's also a basic exemption amount, meaning you don't pay CPP on the first portion of your earnings. For 2024, the employee contribution rate is 5.95% on earnings between the basic exemption ($3,500) and the Year's Maximum Pensionable Earnings (YMPE) of $68,500. The maximum employee contribution for 2024 is $3,867.50.
Example: If your annual gross pay is $60,000, your pensionable earnings for CPP would be $60,000 – $3,500 (basic exemption) = $56,500. Your annual CPP contribution would be $56,500 * 0.0595 = $3,361.75.
Employment Insurance (EI) Premiums
Employment Insurance (EI) provides temporary financial assistance to unemployed Canadians who have lost their jobs through no fault of their own, are sick, pregnant, caring for a newborn or adopted child, or caring for a critically ill or injured person. Like CPP, both employees and employers contribute to EI. Your EI premiums are calculated as a percentage of your insurable earnings, up to a maximum annual amount. For 2024, the employee contribution rate is 1.66% on insurable earnings up to the maximum insurable earnings (MIE) of $63,200. The maximum employee contribution for 2024 is $1,049.12.
Example: If your annual gross pay is $60,000, your insurable earnings for EI would be $60,000 (as it's below the MIE). Your annual EI contribution would be $60,000 * 0.0166 = $996.00.
Federal Income Tax
Federal income tax is levied by the Canadian government on your taxable income. The amount you pay depends on your income level and is calculated using a progressive tax system, meaning higher earners pay a higher percentage of their income in tax. Various non-refundable tax credits, such as the Basic Personal Amount (BPA), reduce the amount of tax you owe. Your employer uses the information from your TD1 form to determine how much federal tax to withhold from each paycheque.
Example: For an annual taxable income of $60,000 in 2024, after accounting for the federal basic personal amount ($15,705), the first $55,867 is taxed at 15%, and the remainder at 20.5%. Your TD1 claim amount reduces your overall tax liability.
Provincial Income Tax
In addition to federal tax, each province and territory levies its own income tax. The rates and tax brackets vary significantly by jurisdiction. Similar to federal tax, provincial tax is also progressive, and provincial non-refundable tax credits (like the provincial basic personal amount, reported on your provincial TD1 form, e.g., TD1ON for Ontario) reduce your provincial tax payable. This calculator uses Ontario's 2024 rates for demonstration.
Example (Ontario): For an annual taxable income of $60,000 in Ontario in 2024, after accounting for the provincial basic personal amount ($12,399), the first $49,231 is taxed at 5.05%, and the remainder at 9.15%. Your TD1ON claim amount reduces your overall provincial tax liability.
Net Pay: What You Take Home
After all mandatory deductions (CPP, EI, Federal Tax, Provincial Tax) and any other voluntary deductions (e.g., pension plans, health benefits, union dues) are subtracted from your gross pay, the remaining amount is your net pay. This is the amount that is deposited into your bank account.
This calculator provides a simplified estimate. Actual payroll calculations can be more complex, involving additional deductions, specific provincial rules, and various tax credits. Always refer to your official pay stub for exact figures.