Canadian Marginal Tax Rates – 2018


This post provides the 2018 combined marginal and average tax rates as tables, charts and a downloadable spreadsheet for the Canadian federal government and all the provinces and territories. It now includes some of the hidden taxes that are not shown on the income tax forms rate tables.

The latest tax rates are available by clicking on Canadian Marginal Taxes Rates – 2020.

The Marginal Tax Rate is defined as the amount of tax paid on an additional dollar of income. It is sometimes difficult to determine this value as it changes by province and using a standard rate without regard to your province of residence can lead to erroneous results if you are not careful.

The federal government has 5 tax brackets and the provinces have from 3 to 6 which rarely match the federal brackets. This results in between 6 and 10 tax brackets. Thus, income differences and the marginal rate between brackets sometimes are not too great.

The 2018 data included here and on the spreadsheet can be found on the Federal and Quebec websites. These may change when the 2018 tax forms are issued.

Use the rates and tax brackets given here when doing any investment planning during 2018.

Hidden Taxes are Now Included

Ontario and Prince Edward Island add taxes that are not part of the rate tables on the tax forms. For example, Ontario has 2 hidden taxes: the surtax and the Health Premium. The former becomes active for incomes around $75,000 (with standard personal deductions) and is a fixed percent of taxes paid of 56%, while the later starts at $20,000 and increases as income increases up to $200,000 where it is a fixed amount of $900. The impact is that the maximum marginal tax rate increases from 46.16% to 53.88% because of these extra taxes.

A useful site that contains this information, plus the marginal rates for capital gains and dividends, is TaxTips.ca. Select your province when the website appears. (They have not included the Health Premium for Ontario.)

The Spreadsheet and a Combined Marginal Rate Example

The information provided below is also in an Excel spreadsheet which you can download. Please click on Download Spreadsheet now and open it if you want to use it. The spreadsheet also contains charts for each province, similar to this one for Ontario. You may use any of the charts or tables. A link to this post or the author would be appreciated.

The blue line is the marginal tax rate while the dashed red line is the average. Notice that while there is a considerable difference between the % along the Y-axis between the marginal and average rates, the average increases almost linearly once the first tax bracket has been exceeded.

Differences Between Provinces

There are significant differences between each province. For example, the combined federal and provincial first tax brackets are given in the chart below, by province. The blue bars (left vertical axis) are the maximum income for the bracket and the red bars and percentages (right vertical axis) are the rate each dollar is taxed at. Notice that the % values range from 19% to 30% for the first $30,000 to $45,000.

The following chart shows the same information but for the last tax bracket. Notice that 7 provinces now take 50% (including the federal government taxes) or more of each additional dollar above a taxable income of over $200,000. All but 2 of the remainder are above 47%.

Actual Tax Rate

Keep in mind that you never pay taxes on all of your income at the Marginal Tax Rate as it only applies to the income above the start of the tax bracket. You also do not pay taxes on all of your income at the Average tax rate, as you will have deductions that reduce the actual tax rate. The following chart for Ontario for 2014 taxes is taken from Impact of Tax Credits on Average Tax Rate which shows that the actual rate is always less than the average rate. The green line is the actual tax rate on all income, with a few of the standard deductions for a retired person.Impact of Tax Credits on Average Tax Rate

Combined Federal & Provincial Tax Brackets Charts

The following charts for the federal and combined federal and provincial tax rates are included in the spreadsheet. They are included here so that you can view the differences between provinces and examine your own province. Because it is hard to determine exact values, scroll down to the table below for more details.

Combined Federal & Provincial Tax Brackets Table

The way to interpret the table below is to determine what your total taxable income (line 260 of the Federal T1 General form) will be for your province without the new income being considered. Then go to the Fed+Province column and note the %. This is the marginal tax rate that any new income will incur. Also examine if the new income pushes the total income into the next tax bracket. If it does, the amount that exceeds the start of the bracket will be taxed at the bracket’s rate.

Examine the ‘From’ and ‘To’ values carefully or use the values on the x-axis of the charts (note that they are spaced by value). To make it easier to see the difference between each tax bracket, the $ Diff and % Diff columns show the difference between tax brackets. Some differences are small because of the interspersing of federal and provincial brackets. The Source column indicates which jurisdiction is responsible for the tax bracket. The End Tax column is the total taxes to be paid when the income reaches the To value. The End Tax is then divided by the To income to generate the Average tax rate. The average is shown on the charts and it is continuous, unlike the Marginal Tax Rate which is flat between the tax brackets.

Find the province you want by scrolling down. They are in alphabetic order. Find your total taxable income in the From & To columns. Use the combined rate in the Fed+Province (provinces are given by their postal abbreviation) column which will be the Marginal Tax Rate.

Alberta
Source From To Federal AB Fed+AB $ Diff % Diff End Tax Average
Fed 0 46,605 15.00% 10.00% 25.00% 46,605 25.00% 11,651 25.00%
Fed 46,606 93,208 20.50% 10.00% 30.50% 46,602 5.50% 25,865 27.75%
AB 93,209 128,145 26.00% 10.00% 36.00% 34,936 5.50% 38,442 30.00%
Fed 128,146 144,489 26.00% 12.00% 38.00% 16,343 2.00% 44,652 30.90%
AB 144,490 153,773 29.00% 12.00% 41.00% 9,283 3.00% 48,458 31.51%
AB 153,774 205,031 29.00% 13.00% 42.00% 51,257 1.00% 69,986 34.13%
Fed 205,032 205,842 29.00% 14.00% 43.00% 810 1.00% 70,334 34.17%
AB 205,843 325,000 33.00% 15.00% 48.00% 119,157 5.00% 127,530 39.24%
British Columbia
Source From To Federal BC Fed+BC $ Diff % Diff End Tax Average
BC 0 39,676 15.00% 5.06% 20.06% 39,676 20.06% 7,959 20.06%
Fed 39,677 46,605 15.00% 7.70% 22.70% 6,928 2.64% 9,532 20.45%
BC 46,606 79,353 20.50% 7.70% 28.20% 32,747 5.50% 18,766 23.65%
BC 79,354 91,107 20.50% 10.50% 31.00% 11,753 2.80% 22,410 24.60%
Fed 91,108 93,208 20.50% 12.29% 32.79% 2,100 1.79% 23,098 24.78%
BC 93,209 110,630 26.00% 12.29% 38.29% 17,421 5.50% 29,769 26.91%
Fed 110,631 144,489 26.00% 14.70% 40.70% 33,858 2.41% 43,549 30.14%
BC 144,490 150,000 29.00% 14.70% 43.70% 5,510 3.00% 45,957 30.64%
Fed 150,001 205,842 29.00% 16.80% 45.80% 55,841 2.10% 71,532 34.75%
BC 205,843 300,000 33.00% 16.80% 49.80% 94,157 4.00% 118,422 39.47%
Manitoba
Source From To Federal MB Fed+MB $ Diff % Diff End Tax Average
MB 0 31,843 15.00% 10.80% 25.80% 31,843 25.80% 8,215 25.80%
Fed 31,844 46,605 15.00% 12.75% 27.75% 14,761 1.95% 12,312 26.42%
MB 46,606 68,821 20.50% 12.75% 33.25% 22,215 5.50% 19,698 28.62%
Fed 68,822 93,208 20.50% 17.40% 37.90% 24,386 4.65% 28,940 31.05%
Fed 93,209 144,489 26.00% 17.40% 43.40% 51,280 5.50% 51,196 35.43%
Fed 144,490 205,842 29.00% 17.40% 46.40% 61,352 3.00% 79,663 38.70%
Fed 205,843 300,000 33.00% 17.40% 50.40% 94,157 4.00% 127,118 42.37%
New Brunswick
Source From To Federal NB Fed+NB $ Diff % Diff End Tax Average
NB 0 41,675 15.00% 9.68% 24.68% 41,675 24.68% 10,285 24.68%
Fed 41,676 46,605 15.00% 14.82% 29.82% 4,929 5.14% 11,755 25.22%
NB 46,606 83,351 20.50% 14.82% 35.32% 36,745 5.50% 24,734 29.67%
Fed 83,352 93,208 20.50% 16.52% 37.02% 9,856 1.70% 28,382 30.45%
NB 93,209 135,510 26.00% 16.52% 42.52% 42,301 5.50% 46,369 34.22%
Fed 135,511 144,489 26.00% 17.84% 43.84% 8,978 1.32% 50,305 34.82%
NB 144,490 154,382 29.00% 17.84% 46.84% 9,892 3.00% 54,938 35.59%
Fed 154,383 205,842 29.00% 20.30% 49.30% 51,459 2.46% 80,307 39.01%
NB 205,843 300,000 33.00% 20.30% 53.30% 94,157 4.00% 130,493 43.50%
Newfoundland and Labrador
Source From To Federal NL Fed+NL $ Diff % Diff End Tax Average
NL 0 36,926 15.00% 8.70% 23.70% 36,926 23.70% 8,751 23.70%
Fed 36,927 46,605 15.00% 14.50% 29.50% 9,678 5.80% 11,606 24.90%
NL 46,606 73,852 20.50% 14.50% 35.00% 27,246 5.50% 21,143 28.63%
Fed 73,853 93,208 20.50% 15.80% 36.30% 19,355 1.30% 28,168 30.22%
NL 93,209 131,850 26.00% 15.80% 41.80% 38,641 5.50% 44,320 33.61%
Fed 131,851 144,489 26.00% 17.30% 43.30% 12,638 1.50% 49,793 34.46%
NL 144,490 184,590 29.00% 17.30% 46.30% 40,100 3.00% 68,359 37.03%
Fed 184,591 205,842 29.00% 18.30% 47.30% 21,251 1.00% 78,411 38.09%
NL 205,843 300,000 33.00% 18.30% 51.30% 94,157 4.00% 126,713 42.24%
Nova Scotia
Source From To Federal NS Fed+NS $ Diff % Diff End Tax Average
NS 0 29,590 15.00% 8.79% 23.79% 29,590 23.79% 7,039 23.79%
Fed 29,591 46,605 15.00% 14.95% 29.95% 17,014 6.16% 12,135 26.04%
NS 46,606 59,180 20.50% 14.95% 35.45% 12,574 5.50% 16,593 28.04%
Fed 59,181 93,208 20.50% 16.67% 37.17% 34,027 1.72% 29,240 31.37%
NS 93,209 93,000 26.00% 16.67% 42.67% -209 5.50% 29,151 31.35%
Fed 93,001 144,489 26.00% 17.50% 43.50% 51,488 0.83% 51,549 35.68%
NS 144,490 150,000 29.00% 17.50% 46.50% 5,510 3.00% 54,111 36.07%
NS 150,001 205,842 29.00% 21.00% 50.00% 55,841 3.50% 82,031 39.85%
NS 205,843 300,000 33.00% 21.00% 54.00% 94,157 4.00% 132,876 44.29%
Northwest Territories
Source From To Federal NT Fed+NT $ Diff % Diff End Tax Average
NT 0 42,209 15.00% 5.90% 20.90% 42,209 20.90% 8,822 20.90%
Fed 42,210 46,605 15.00% 8.60% 23.60% 4,395 2.70% 9,859 21.15%
NT 46,606 84,420 20.50% 8.60% 29.10% 37,814 5.50% 20,863 24.71%
Fed 84,421 93,208 20.50% 12.20% 32.70% 8,787 3.60% 23,736 25.47%
NT 93,209 137,248 26.00% 12.20% 38.20% 44,039 5.50% 40,559 29.55%
Fed 137,249 144,489 26.00% 14.05% 40.05% 7,240 1.85% 43,459 30.08%
Fed 144,490 200,000 29.00% 14.05% 43.05% 55,510 3.00% 67,356 33.68%
Fed 200,001 300,000 33.00% 14.05% 47.05% 99,999 4.00% 114,405 38.14%
Nunavut
Source From To Federal NU Fed+NU $ Diff % Diff End Tax Average
NU 0 44,437 15.00% 4.00% 19.00% 44,437 19.00% 8,443 19.00%
Fed 44,438 46,605 15.00% 7.00% 22.00% 2,167 3.00% 8,920 19.14%
NU 46,606 88,874 20.50% 7.00% 27.50% 42,268 5.50% 20,543 23.12%
Fed 88,875 93,208 20.50% 9.00% 29.50% 4,333 2.00% 21,822 23.41%
Fed&NU 93,209 144,488 26.00% 11.50% 37.50% 51,279 8.00% 41,051 28.41%
NU 144,489 205,842 29.00% 11.50% 40.50% 61,353 3.00% 65,899 32.01%
NU 205,843 300,000 33.00% 11.50% 44.50% 94,157 4.00% 107,799 35.93%
Ontario
Source From To Federal ON Fed+ON $ Diff % Diff End Tax Average
ON 0 20,000 15.00% 5.05% 20.05% 20,000 20.05% 4,010 20.05%
ON 20,001 42,960 15.00% 6.48% 21.48% 22,959 21.48% 9,228 21.48%
Fed 42,961 46,605 15.00% 15.21% 30.21% 3,644 8.73% 10,328 22.16%
ON 46,606 85,923 20.50% 15.21% 35.71% 39,317 5.50% 24,366 28.36%
Fed 85,924 93,208 20.50% 18.05% 38.55% 7,284 2.84% 27,174 29.15%
Fed 93,209 144,489 26.00% 18.05% 44.05% 51,280 5.50% 49,761 34.44%
ON 144,490 150,000 29.00% 18.05% 47.05% 5,510 3.00% 52,353 34.90%
Fed 150,001 205,842 29.00% 19.38% 48.38% 55,841 1.33% 79,366 38.56%
ON 205,843 220,000 33.00% 19.38% 52.38% 14,157 4.00% 86,781 39.45%
ON 220,001 300,000 33.00% 20.88% 53.88% 79,999 1.50% 129,881 43.29%
Prince Edward Island
Source From To Federal PE Fed+PE $ Diff % Diff End Tax Average
PE 0 31,984 15.00% 9.80% 24.80% 31,984 24.80% 7,932 24.80%
Fed 31,985 46,605 15.00% 13.80% 28.80% 14,620 4.00% 12,143 26.05%
PE 46,606 63,969 20.50% 13.80% 34.30% 17,363 5.50% 18,098 28.29%
Fed 63,970 93,208 20.50% 18.37% 38.87% 29,238 4.57% 29,463 31.61%
Fed 93,209 144,489 26.00% 18.37% 44.37% 51,280 5.50% 52,216 36.14%
Fed 144,490 205,842 29.00% 18.37% 47.37% 61,352 3.00% 81,278 39.49%
Fed 205,843 300,000 33.00% 18.37% 51.37% 94,157 4.00% 129,647 43.22%
Quebec
Source From To Federal QC Fed+QC $ Diff % Diff End Tax Average
QC 0 43,055 15.00% 15.00% 30.00% 43,055 30.00% 12,917 30.00%
Fed 43,056 46,605 15.00% 20.00% 35.00% 3,549 5.00% 14,159 30.38%
QC 46,606 86,105 20.50% 20.00% 40.50% 39,499 5.50% 30,156 35.02%
Fed 86,106 93,208 20.50% 24.00% 44.50% 7,102 4.00% 33,316 35.74%
QC 93,209 104,765 26.00% 24.00% 50.00% 11,556 5.50% 39,094 37.32%
Fed 104,766 144,489 26.00% 25.75% 51.75% 39,723 1.75% 59,651 41.28%
Fed 144,490 205,842 29.00% 25.75% 54.75% 61,352 3.00% 93,241 45.30%
Fed 205,843 300,000 33.00% 25.75% 58.75% 94,157 4.00% 148,558 49.52%
Saskatchewan
Source From To Federal SK Fed+SK $ Diff % Diff End Tax Average
SK 0 45,225 15.00% 10.50% 25.50% 45,225 25.50% 11,532 25.50%
Fed 45,226 46,605 15.00% 12.50% 27.50% 1,379 2.00% 11,912 25.56%
Fed 46,606 93,208 20.50% 12.50% 33.00% 46,602 5.50% 27,290 29.28%
SK 93,209 129,214 26.00% 12.50% 38.50% 36,005 5.50% 41,152 31.85%
Fed 129,215 144,489 26.00% 14.50% 40.50% 15,274 2.00% 47,338 32.76%
Fed 144,490 205,842 29.00% 14.50% 43.50% 61,352 3.00% 74,026 35.96%
Fed 205,843 300,000 33.00% 14.50% 47.50% 94,157 4.00% 118,751 39.58%
Yukon
Source From To Federal YT Fed+YT $ Diff % Diff End Tax Average
Fed&YT 0 46,605 15.00% 6.40% 21.40% 46,605 21.40% 9,973 21.40%
Fed&YT 46,606 93,208 20.50% 9.00% 29.50% 46,602 8.10% 23,721 25.45%
Fed&YT 93,209 144,489 26.00% 10.90% 36.90% 51,280 7.40% 42,643 29.51%
Fed 144,490 200,000 29.00% 12.80% 41.80% 55,510 4.90% 65,847 32.92%
YT 200,001 500,000 33.00% 12.80% 45.80% 299,999 4.00% 203,246 40.65%
YT 500,001 550,000 33.00% 15.00% 48.00% 49,999 2.20% 227,246 41.32%