Tax Rate Calculator Ontario 2016

This tax rate calculator helps you determine your Ontario provincial tax rates for the year 2016. It calculates both federal and provincial taxes based on your taxable income, showing you the marginal tax rates and your effective tax rate.

How to Use This Calculator

To use this tax rate calculator:

Enter your total taxable income for 2016 in the "Taxable Income" field.
Select whether you want to calculate federal taxes only, provincial taxes only, or both.
Click the "Calculate" button to see your tax rates.
Review the results, which show your marginal tax rate and effective tax rate.

The calculator will display your tax liability and the percentage of your income that goes to taxes.

Ontario Tax Brackets 2016

In 2016, Ontario had the following progressive tax rates:

Taxable Income	Marginal 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%

Federal tax rates for 2016 were:

Taxable Income	Marginal 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%

How Ontario Taxes Are Calculated

Ontario uses a progressive tax system where your tax rate increases as your income increases. The calculation process is as follows:

Determine your taxable income by subtracting deductions from your total income.
Apply the Ontario tax brackets to calculate your provincial tax liability.
Apply the federal tax brackets to calculate your federal tax liability.
Add the provincial and federal taxes to get your total tax liability.
Divide the total tax by your taxable income to get your effective tax rate.

Formula

Effective Tax Rate = (Total Tax Liability / Taxable Income) × 100%

The marginal tax rate is the rate that applies to the last dollar of your income in each bracket.

Worked Examples

Example 1: Single Person with $50,000 Income

For a single person earning $50,000 in 2016:

Ontario tax: $50,000 × 5.05% = $2,525
Federal tax: $50,000 × 15% = $7,500
Total tax: $2,525 + $7,500 = $10,025
Effective tax rate: ($10,025 / $50,000) × 100% = 20.05%

Example 2: Single Person with $100,000 Income

For a single person earning $100,000 in 2016:

Ontario tax: ($43,906 × 5.05%) + ($56,094 × 9.15%) = $2,195 + $5,128 = $7,323
Federal tax: ($45,282 × 15%) + ($45,281 × 20.5%) + ($9,437 × 26%) = $6,792 + $9,300 + $2,474 = $18,566
Total tax: $7,323 + $18,566 = $25,889
Effective tax rate: ($25,889 / $100,000) × 100% = 25.89%

Frequently Asked Questions

What is the difference between marginal and effective tax rates?

The marginal tax rate is the rate that applies to your last dollar of income in each bracket. The effective tax rate is the average rate that applies to your entire income, calculated by dividing your total tax by your taxable income.

How do I calculate my taxable income?

Your taxable income is your total income minus any eligible deductions. Common deductions include RRSP contributions, union dues, and medical expenses.

Are there any tax credits available in Ontario?

Yes, Ontario offers various tax credits such as the Ontario Child Benefit, Ontario Trillium Benefit, and the Ontario Disability Support Program. These can reduce your tax liability.

How do I file my taxes if I'm self-employed?

Self-employed individuals should keep detailed records of all income and expenses. You may need to file a T2 slip with the Canada Revenue Agency and complete a self-employment tax return.