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Canadian Income Tax Calculator 2008
Find out how much 2008 income tax you owe in Canada in one easy step.
See our new 2010 income tax calculator
If you like our Canadian income tax calculator, be sure to try our life insurance needs analysis calculator and our instant term life insurance rates calculator for Canada.
| Province | Tax Payable | After-Tax Income |
Average Tax Rate |
Marginal Tax Rate |
Marginal Rate on Capital Gains |
Marginal Rate on Eligible Dividends* |
Marginal Rate on Ineligible Dividends* |
 Quebec |
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 N.B. |
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 N.S. |
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 P.E.I. |
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 Nfld. |
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 N.W.T. |
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 Yukon |
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 Nunav. |
These calculations do not include non-refundable tax credits other than the basic personal tax credit.
These rates give you a basic of idea of how much tax you should pay, but depending on your employment and business and personal circumstances you could pay a lot less. Be sure to visit a competent tax advisor before filing your return.
* Eligible Dividends are dividends from a Canadian corporation on which corporate tax has already been paid. Normally the dividend issuer will alert you to the eligibility of a given dividend. All other Canadian dividends are considered Ineligible Dividends. Non-Canadian Dividends do not qualify for the dividend tax credit. They are simply treated as income.
Update: As of 08 February 2008, the rates are 2008 for Ontario and 2007 for the other provinces. We will be updating the rest of the rates soon so be sure to check back.
Update: As of 11 February 2008, the rates are 2008 for all provinces.
Update: As of 18 March 2008, some rates have been corrected and adjusted as per the helpful notes of Wilfred J. Pelletier.
Direct line: 905.248.4849 Email:
[…] Ontario (CA), February 13, 2008 - The first online 2008 Canadian Income Tax Calculator was released today. This tool incorporates all tax rates for all 13 provinces of […]
This calculator is very good BUT …
IT DOES NOT SHOW A RESULT FOR ELIGIBLE DIVIDENDS !!
(In other words it does not show the dividend marginal rate of tax for dividends received from PUBLIC companies (called
“eligible dividends” )
Please consider modifying your program ….then I can rate it 5 out of 5 !! (I now rate it 3 out of 5 because of the omission !!)
Does this include EI and CPP payable?
Hello Thomas,
I’m afraid this chart does not include EI and CPP payable as they are variable dependent on situation.
Generally, you will get all of your EI refunded if you are self-employed for example.
Please refer to my previous query - re “eligible dividends” .
Will I get a response? Thank you.
Sorry this may seem like a very silly question but its my first time…the section that says tax payable and it gives you a number is that the amount we owe the govt or is that the amount they return to me?
@ Wilfred J. Pelletier
Thank you for your astute observations. Eligible dividends should be included and will be by next week. We sincerely apologise for any inconvenience our oversight has caused you.
@ confused thought
Unfortunately, this is what we owe the government. They get a good hunk of our income. Our neighbours to the south pay less tax. But as Canadians, we have better schools and roads and a far smaller proportion of our population in prisons. Not to mention universal health care. Roads, hospitals and schools cost money but save prisons and save lives. I’d be interested to see an economic analysis: in the end, I think they save money by reducing the costs of incarceration and an overwhelmed justice system.
Paying more taxes likely gives most of us better lives. We do have to keep a close eye on those politicians though. Our tax money should be spent on the hospitals, roads and schools and not on politico junkets or backroom government subsidies to party supporters.
Hi there
I was quite surprised and pleased with the calculator you made. It’s even more surprising the first of its kind was out in 2008, right when I needed one!
My question concerns businesses. Does the income tax required vary for unincorporated individuals? I run a franchise and am the sole employer and operator in the company. Thanks for any advice!
Hello Victor,
Whether you are incorporated or not should not affect the taxes you pay on personal income. An incorporated individual does have more complex decisions to make regarding whether or not he wants to declare certain expenses as part of business costs or personal costs for business.
As a sole employer and operator, your tax situation is much simpler. Do consult a professional though - as a business owner it’s too expensive not to take professional tax advice.
If you’re a business owner with dependents – you should definitely look into a life insurance plan to protect your family and depending on the policy it can generate a tax sheltered cash value. Feel free to call me at 905 248 4849 if you have any other questions.
Good luck with your franchise!
Hello Wilfred,
We’ve updated the tax calculator as per your suggestion to include Eligible Dividends.
Good suggestion. Please let us know if you notice any error with our math for eligible dividends. We based on our numbers on Revenue Canada’s own website.
Cordial regards, Lorne
is this both provincial and federal, or just one.
Hello John,
This calculator covers both provincial and federal tax. Depending on your situation, you would be eligible for additional deductions. This calculator gives you your maximum legal liability to Revenue Canada and your province on your income.
What is the difference between avg tax rate and marginal tax rate?
My response - your average tax rate is overall average amount of tax you pay on your total income; whereas your marginal tax rate is the amount of tax your pay on your next dollar of earned income. I hope that helps.
Hi,
I found this very usefull.
I have moved from province to province over the years and I found it interesting to see how much tax difference there is from province to province.
My salary changes from year to year. Since you already have all the data from previous tax years, I would have found it very usefull to have a comparative amount of tax, say another column for 2007.
All around, you’ve designed a quick and powerfull tool.
J
Thanks for the kind words. I appreciate your suggestion. All the best! Lorne
This is an excellent tool. However, it does not take into consideration all the additional payroll deductions that are taken every pay period. That would be a helpful additional piece of information.
Thanks for the note and the advice. We’re always looking to improve the site. Lorne
To whom it may concern:
When I use the Canadian income tax calculator for 2008, it informs me that the Alberta tax payable will be $10,291. However, when I use Canada Revenue’s income tax rate chart it shows that for the first $37,885 the tax would be 15% or $5682, and for the balance of approx. $12,000 @ 22% the tax payable would be $2600 for a total of approx $8347.
Then when I consult the Alberta provincial tax rate, which is a flat 10% of the taxable rate, it appears that the tax would be about $4600.
Can you explain the discrepancy? Naturally, I prefer the income tax calculator figure of $10,291, but I want to be very sure that that figure is the correct one.
In response to Allen Walker’s question (sorry for the delay - I referred it to one of the tax specialist we work with), here is the info:
Can you explain the how the concept of marginal tax rates works. Thank you for your help! A.L
This calculator is not meant to be the definitive tax calculator, and it is important to remember that it is generating anwerds based on your taxable income, i.e. after all deductions, etc. have been taken into account.
Personally I use it primarily for determining the marginal tax rate, which I then use to determine the tax consequences of new investments, especially if considering a GIC where 100% of the gain is taxable, vs. an equity investment where the gain is 100% capital gain, on which only 50% is taxable.
Hi,
This is a great tool. It makes it so much easier to get an idea of how our income bracket makes a difference on our income tax. It helped me get an idea of how much RRSP contribution is optimal for my income tax bracket.
Thanks for this great tool!
Yamini
Hi Yamini,
Thanks for the note. I’m glad you found the calculator useful and I appreciate the kind words.
Regards … Lorne
In regards to Yamini, which column would you use to determine or atleast get an idea of your RRSP contribution ? would you take your taxable income and multiply it by your marginal rate on ineligible dividends ?
Hi, This is a great calculator !!
For a person who does not have a regular income (eg. it’s only from capital gains), this calculator shows that the marginal tax rate on the capital gains is zero. I entered $9000 as my taxable income and it says i don’t owe any money to the government which makes sense and it says that my marginal rates for capital gains and ineligible dividends are both zero..!! is that true?
Thanks Faraz!
You are correct for a taxable income of $9,000. However using BC as an example, their Basic Personal Exemption is $9,323. So any amount over that amount will be taxable. Once the income is over $10,320 the taxable income is based on both the federal and provincial rates, minus the basic personal exemptions.
Regards …
I am a new comer to Toronto on july 2008 I am not working and I still searching inspit that I have PHD degree in Law , I wounder if I have to present any income tax statement for the year 2008 .
Thanks for asking this question. This question is one of those that many people ask from time to time, and worth a refresher. Fortunately the CRA website is always a good source of answers to these questions. The answer to your question can be found at: http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/flng-blgtns/menu-eng.html.
This site summarizes when you need to file a return:
Do you have to file a return? You have to file a return for 2008 if any of the following situations apply:
•You have to pay tax for 2008.
•We sent you a request to file a return.
•You and your spouse or common-law partner elected to split pension income for 2008. See line 115 - Other pensions or superannuation, and line 129 - RRSP income, for details.
•You received Working Income Tax Benefit (WITB) advance payments in 2008, and you want to apply for WITB advance payments for 2009.
•You disposed of capital property in 2008 (for example, if you sold real estate or shares) or you realized a taxable capital gain (for example, if a mutual fund or trust attributed amounts to you, or you are reporting a capital gains reserve you claimed on your 2007 return).
•You have to repay any of your Old Age Security or Employment Insurance benefits. See line 235 - Social benefits repayment, for details.
•You have not repaid all of the amounts you withdrew from your registered retirement savings plan (RRSP) under the Home Buyers’ Plan or the Lifelong Learning Plan. For details, see Guide RC4135 - Home Buyers’ Plan (HBP) or Guide RC4112 - Lifelong Learning Plan (LLP).
•You have to contribute to the Canada Pension Plan (CPP). This can apply if, for 2008, the total of your net self-employment income and pensionable employment income is more than $3,500. See line 222 - Deduction for CPP or QPP contributions on self-employment and other earnings.
Even if none of these requirements apply, you may still want to file a return to receive certain benefits and credits. See Benefits of filing a return.
Benefits of filing a return You may want to file a return if any of the following applies to you:
•You want to claim a refund.
•You received Working Income Tax Benefit (WITB) advance payments in 2008, and you want to apply for WITB advance payments for 2009.
•You want to apply for the GST/HST credit. For example, you may be eligible if you turn 19 before April 2010.
•You or your spouse or common-law partner want to begin or continue receiving Canada Child Tax Benefit payments.
•You have incurred a non-capital loss (see line 236) in 2008 that you want to be able to apply in other years.
•You want to carry forward or transfer the unused portion of your tuition, education, and textbook amounts (see line 323 and line 324).
•You want to report income for which you could contribute to an RRSP, in order to keep your RRSP deduction limit for future years up to date.
•You want to carry forward the unused investment tax credit on expenditures you incurred during the current year (see line 412).
•You receive the Guaranteed Income Supplement or Allowance benefits under the Old Age Security Program. You can usually renew your benefit simply by filing your return by April 30. If you choose not to file a return, you will have to complete a renewal application form. This form is available from the Service Canada website.
This is probably a longer answer that you were looking for, but it is an opportunity to highlight when you need to file, and when it may be opportune to file.