Marginal Tax Rate Calculator

Enter your taxable income and province to see your marginal rate — the combined federal and provincial tax on the next dollar you earn — alongside your average rate and total tax. The rate is measured by recomputing your tax $100 higher, so Ontario’s surtax bands and Quebec’s federal abatement show up in the number. Rates are current for the 2025 tax year.

2025 tax year rates All 13 provinces Updates as you type

Your income

$

How it works. The calculator computes your combined federal and provincial tax twice — at your income and at your income plus $100 — and the difference is your marginal rate. Measuring instead of looking up a bracket table means provincial surtaxes, the basic personal amounts and Quebec’s federal abatement are all baked into the figure, which is why it can sit between the published bracket rates.

Your marginal tax rate

0%

0% average rate — $0 total tax

You keep (per $100 at the margin) $0 Tax at the margin $0
Tax on your income$0
Of the next $100 earned, you keep$0
Average (effective) rate0%
Marginal rate on the next dollar0%

Because the rate is measured, not looked up, it includes Ontario surtax and Quebec abatement effects at your exact income. It covers income tax only — CPP, EI and benefit clawbacks are separate.

An estimate is a starting point. Get your real number.

This calculator uses published rates. Your actual position depends on the credits, deductions and structure behind your numbers.

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Why Choose Us for Marginal Tax Rate Calculator

Your marginal rate is the tax on the next dollar you earn; your average rate is total tax divided by total income. They answer different questions. At $120,000 in Ontario the marginal rate is 43.4% but the average rate is about 23.8% — because the first slices of income were taxed at lower bracket rates (and the basic personal amount taxed the very first slice at nothing). The marginal rate is the one that prices decisions: whether overtime is worth it, what a raise really delivers, and what a deduction saves.

The marginal rate does not climb smoothly. It jumps at every federal and provincial bracket edge, and in Ontario it also jumps where the surtax bands begin — thresholds you will not find in any bracket table, which is why this calculator measures the rate rather than looking it up. The most practical use of the number: an RRSP contribution deducts from your top slice, so it saves tax at exactly this marginal rate. Run your contribution through the RRSP tax savings calculator to see the dollars.

What this calculator does not cover

Income tax is not the only thing that rises with income. Benefit clawbacks — OAS recovery tax, the Canada Child Benefit phase-out, GST credit reductions — take back money as income grows, so your true effective marginal rate in a clawback zone can be well above the tax-only figure shown here. Dividends and capital gains also carry their own rates: dividends through the gross-up and credit mechanism, capital gains through the 50% inclusion. Structuring income around those edges is tax planning work, and it pays for itself most at exactly the incomes where the marginal rate bites.

2025 federal brackets
Taxable incomeFederal rate
Up to $57,375 14.5%
$57,375–$114,750 20.5%
$114,750–$177,882 26%
$177,882–$253,414 29%
Over $253,414 33%

Rates reviewed for the 2025 tax year by Udit Gupta, Certified Tax Accountant. Federal and provincial rates change annually, and this tool is an estimate for planning rather than tax advice. Confirm current figures before relying on them for a filing.

Frequently asked questions

It is the combined federal and provincial tax on your next dollar of income — the rate at the top of your personal stack. Canada taxes income in slices: each bracket rate applies only to the dollars inside that bracket, and the marginal rate is the rate on the highest slice you have reached. It is the right rate for evaluating a raise, a bonus, extra billings or a deduction.
The average (or effective) rate is your total tax divided by total income — what your income costs overall. The marginal rate is what the next dollar costs. The average is always lower because your earlier dollars passed through lower brackets and the basic personal amount. Use the average to understand your year; use the marginal to price a decision.
No — this is the most persistent tax myth in Canada. Bracket rates apply only to the income above each threshold, never retroactively to what sits below it. A raise that crosses a bracket edge is taxed at the higher rate only on the dollars past the edge. You always keep more by earning more; the keep-rate on the extra dollars just shrinks.
Because the published tables leave things out. Ontario layers a surtax on top of provincial tax with its own thresholds, Quebec residents get a federal abatement, and the basic personal amounts shift where tax actually starts. This calculator measures the rate by recomputing your tax $100 higher, so all of those effects land in the figure — which is why it can sit between the textbook bracket rates.
A deduction removes dollars from the top of your stack, so it saves tax at your marginal rate — roughly $43 per $100 contributed at a 43.4% marginal rate. A large contribution can walk down through a bracket, so the last dollars save at a lower rate than the first. That is also the core RRSP timing idea: deduct in high-rate years, withdraw in lower-rate ones.
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