Convert an hourly wage to an annual salary — then keep going to the number that actually matters: the take-home paycheque in your province.
Preset to $25/hour in Ontario. Enter your wage, your hours, and your province; we annualize it and run the full 2026 calculation.
| Gross pay (annual) | $0 |
| Federal income tax | $0 |
| Provincial income tax | $0 |
| CPP + CPP2 | $0 |
| EI premiums | $0 |
| Total income tax | $0 |
| Net pay (annual) | $0 |
| Average (effective) tax rate | 0% |
| Marginal rate on your next $100 | 0% |
Each row assumes 40 hours a week, 52 weeks a year (2,080 hours), Ontario tax, standard scope.
| Hourly wage | Annual gross | Income tax | CPP + EI | Net pay | Bi-weekly |
|---|---|---|---|---|---|
| $18/hr | $37,440 | $3,848 | $2,630 | $30,962 | $1,191 |
| $20/hr | $41,600 | $4,644 | $2,945 | $34,011 | $1,308 |
| $25/hr | $52,000 | $6,625 | $3,733 | $41,641 | $1,602 |
| $30/hr | $62,400 | $9,057 | $4,522 | $48,821 | $1,878 |
| $35/hr | $72,800 | $12,153 | $5,246 | $55,401 | $2,131 |
The conversion itself is simple — wage × hours per week × 52 — but the take-home column is where job offers should be compared. A $2/hour raise at 40 hours a week is $4,160 a year gross; at the $25/hour level in Ontario, about $2,700–$2,900 of it survives tax and payroll deductions, because the raise is taxed at your marginal rate, not your average rate. Part-time schedules change the math again: the same wage at 25 hours a week lands in lower brackets and keeps a bigger share, which the calculator shows when you set the hours.
Overtime: hourly staff often earn time-and-a-half past a threshold (44 hours a week in Ontario). Overtime is taxed as ordinary income — withheld at your marginal rate on that cheque, settled at filing. A heavy-overtime cheque looks "over-taxed" for the same reason bonuses do; see the bonus guide. Statutory holiday pay, vacation pay (at least 4% in Ontario), and benefits sit outside this calculator: a salaried offer with paid vacation and a benefits plan can be worth several dollars an hour more than the wage comparison suggests. Two part-time jobs each withhold as if they were your only job, which duplicates the basic personal amount in withholding and often means a balance owing in April — the annual calculation here, on combined income, is the truer picture.
Four deductions come off your gross pay, in this order. First, CPP (or QPP in Quebec): 5.95% of earnings between the $3,500 basic exemption and the 2026 maximum pensionable earnings of $74,600, plus CPP2 at 4% on earnings between $74,600 and $85,000 — a maximum of $4,646.45 for the year. Second, EI: 1.63% of insurable earnings up to $68,900, a maximum of $1,123.07 (Quebec pays 1.30% plus QPIP instead). Third, federal income tax using the five federal brackets, reduced by your non-refundable credits. Fourth, provincial income tax using your province's own brackets and basic personal amount. What's left is your net pay.
Two rates describe your tax bill. Your average (effective) rate is total income tax divided by gross income — the share of your pay that goes to income tax overall. Your marginal rate is what the next $100 costs you in tax and payroll deductions; it's the rate that matters for a raise, overtime, or an RRSP decision. Because brackets are progressive, your marginal rate is always higher than your average rate — and no, moving into a higher bracket never makes your whole paycheque taxed at the higher rate. Only the dollars inside the bracket are. Our marginal vs effective rate guide walks through a full example.
One quirk to expect: CPP and EI are deducted from the first paycheque of the year until you hit the annual maximums, then they stop. On a salary over about $74,600, CPP is finished partway through the year and your net pay jumps — the mid-year "raise" explained in our CPP & EI maxed-out guide. This calculator spreads the annual amounts evenly across your pay periods, so your early-year cheques will be slightly smaller and your later cheques slightly larger than the figure shown.
Why is my actual paycheque different? Employers withhold using payroll tables and the TD1 forms you filed, and they deduct CPP/EI at full speed from January. Bonuses and overtime are withheld at your marginal rate, benefits and union dues may come off too, and any RRSP contributions through payroll lower taxable income. The annual total is what this calculator estimates; the timing inside the year varies.
Is CPP a tax? It's a mandatory pension contribution, not income tax — you get a pension back for it in retirement — but it comes off your pay the same way, so we show it in your deductions and also give it back to you as a tax credit in the calculation, the same way your return does.
What changed for 2026? The lowest federal rate is 14% for the full year (it was a blended 14.5% in 2025 after the mid-2025 tax cut), federal brackets and the basic personal amount were indexed 2.0%, the CPP ceiling rose to $74,600 with CPP2 up to $85,000, and the EI ceiling rose to $68,900 at a slightly lower 1.63% rate.
What this estimate includes — and what it doesn't. The calculator models 2026 employment income with the basic personal amount and the standard payroll credits (CPP/QPP and EI/QPIP contributions, plus the federal Canada employment amount of up to $1,501). It does not model RRSP or other deductions, or any other credits — no spousal, age, pension, tuition, or medical amounts, and no low-income credits such as the Canada Workers Benefit. Treat the result as a solid estimate, labelled honestly: basic personal amount and standard payroll credits only. Your pay stub and your notice of assessment are the final word.