How is individual income tax handled in Canada?

In Canada, employers must withhold mandatory income tax from employee pay. Federal income tax varies based on an employee’s income level. Additional provincial tax may be owed. 


The federal income tax on annual gross salary in Canada is as follows: 


  • Up to 48,535 CAD (USD 38,915): 15%  
  • 48,535-97,069 CAD (USD 38,915-77,829): 20.5%  
  • 97,069-150,473 CAD (USD 77,829-120,648): 26%  
  • 150,473-214,368 CAD (USD 120,648-171,879): 29%  
  • 214,368 CAD+ (USD 171,879+): 33% 


If you have questions about payroll regulations and procedures in Canada, please get in touch with our team today! 

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