Income Tax Calculation Ontario 2017

Calculating your Ontario income tax for 2017 involves understanding both provincial and federal tax brackets, deductions, and credits. This guide explains the process step-by-step and provides a calculator to compute your estimated tax liability.

How to Calculate Ontario Income Tax 2017

The process of calculating your Ontario income tax involves several steps:

Determine your taxable income by subtracting eligible deductions from your total income.
Calculate provincial tax using Ontario's tax brackets.
Calculate federal tax using Canada's tax brackets.
Apply any applicable tax credits.
Sum the provincial and federal taxes to get your total income tax.

Use the calculator on this page to perform these calculations quickly and accurately.

Ontario Tax Brackets 2017

Ontario uses a progressive tax system with different tax rates for different income levels. The 2017 tax brackets are as follows:

Taxable Income	Tax Rate
$0 - $43,906	5.05%
$43,907 - $87,813	9.15%
$87,814 - $150,000	11.16%
$150,001 - $220,000	12.16%
Over $220,000	13.16%

Note: These are the basic provincial tax rates. Additional deductions and credits may affect your final tax liability.

Federal Income Tax 2017

Canada's federal tax system also uses progressive brackets. The 2017 federal tax rates are:

Taxable Income	Tax Rate
$0 - $45,282	15%
$45,283 - $90,563	20.5%
$90,564 - $140,388	26%
$140,389 - $200,000	29%
Over $200,000	33%

Federal tax is calculated on the same taxable income as provincial tax.

Common Ontario Tax Credits

Several tax credits can reduce your overall tax liability. Common credits include:

Ontario Child Benefit: Provides financial support for children under 18.
Ontario Trillium Benefit: Supports low-income individuals and families.
Canada Child Benefit: A federal credit for children under 18.
Canada Pension Plan (CPP) Contributions: Employer and employee contributions.

Total Income Tax = (Provincial Tax + Federal Tax) - Tax Credits

Example Calculation

Let's calculate the income tax for someone with $80,000 taxable income in 2017.

Provincial tax: $80,000 × 9.15% = $7,320
Federal tax: $80,000 × 20.5% = $16,400
Total before credits: $7,320 + $16,400 = $23,720
Assuming $2,000 in tax credits: $23,720 - $2,000 = $21,720

The final income tax liability would be $21,720 for this example.

Frequently Asked Questions

What is the difference between taxable income and gross income?: Taxable income is your gross income minus eligible deductions. Deductions can include RRSP contributions, union dues, and medical expenses.
How do I calculate my taxable income?: Subtract all eligible deductions from your total income to get your taxable income. Use the calculator on this page to do this automatically.
What are the most common Ontario tax credits?: The Ontario Child Benefit, Ontario Trillium Benefit, Canada Child Benefit, and CPP contributions are among the most common credits.
How do I file my Ontario income tax return?: You can file online through the Ontario government's website, by mail, or at a tax office. The deadline for 2017 returns was April 30, 2018.
What happens if I owe more tax than I paid?: You will need to pay the difference by the tax deadline. The government may also charge interest and penalties for late payment.