@calmmoneycoach: The Canadian tax system is heavy. Top combined rates above 53% in five provinces. We're in the same neighbourhood as Denmark and France globally. HST on every dollar. Frozen brackets. Wages that haven't kept up. None of that is in your head. But on this one piece of math, the bracket math, the gut feeling has it backwards. And it costs real money on top of everything else. Three things to remember: 1. Marginal isn't your average. The bracket rate is what your NEXT dollar costs. Not your whole paycheque. There is no bracket in Canada that produces a net loss. Just the feeling of one on payday. 2. Province matters at the top. At $250K gross income, an Albertan keeps about $15K more per year than a Quebecer. Same job. Same salary. Different math. 3. Working families pay the most. Hidden CCB clawback stacks on top of income tax. An Ontario family with two kids on $80K gets a 43% effective benefit on a $10K RRSP contribution. The bracket said 29. With three kids, 48. C.D. Howe Institute research shows some single parents in the phase-out band hit effective rates above 70%. Higher than any top earner in Canada pays. The squeeze is real. The bracket math is one piece. The piece that costs you money when you have it backwards. Save this. Send it to anyone who's ever turned down a raise or extra hours because of "the next bracket." Follow @calmmoneycoach for the rest of the math.

user1285071225318 :

I don’t mind paying taxes in theory but it doesn’t feel like we are getting a good return on our investment. Other high tax rate countries have better healthcare and more social programs that actually benefit people.

Dankmin :

I don't want to work more hours because I don't like working.

Proka$h🇨🇦 :

payroll systems are programmed to assume that the amount of money you make in any pay period reflects what you will make annually. so if you usually make $2000 biweekly tax is withheld at (2000 × 26) = $52,000/year. then you work OT and earn $3000 in a pay period, the system assumes you make $78,000/year and you "pay a lot of tax". but taxes are only estimated at the time you get your cheque. they are calculated annually.

🇨🇦 Jenny 🇨🇦 :

It’s so weird that people don’t understand marginal tax brackets

DM🇨🇦 :

appreciate this and ur content

Fitzpatria :

Nova Scotian here 👋 our provincial gov is terrible at budgets given how much we pay in taxes

Gono_Chirandu 🍁 :

In South Africa, electricity is charged using the same system-> Tiered electricity tariff system

Rocko :

Taxes in Canada are terribly unfair.

lampbeartoe 🛋🐻🦶 :

The only thing they should do to fix this is to tax your income like they tax capital gains

Chef jp :

I think everyone should be in the same tax bracket.

sp trader :

ha thats a issue from the past. now we are just hosed eh.

Asdf1234 :

I love how you explain it and even at the end of system is so complicated. I still don’t understand it. 😂😭

L_77_77 🇨🇦 :

This drives me absolutely nuts.

🇬🇧🇬🇧🇦🇺🇦🇺🇬🇧🇬🇧 :

Have a look at Australia. Top bracket after $190,000 @ 47%

OnlineOutlet :

Suggestion, use Avg. Tax rate that is all that matters. 27.7 % tax combined taxes Fed and Prov on $100K gross. Take home $72K ish.

WC :

We have a progressive tax system… it doesn’t really make sense to stay stagnant just because you just don’t want to be in an other “bracket”

  Anonymous user :

I’ve always wanted to know

akennedysusan2 :

Yep! I know people….

stormybrightsky :

I’m trying to understand the CTB phase out band… Does that mean a single income earner, single parent at 80 K should contribute more to rrsp to avoid that clawback? In ON?

martmu33 🇨🇦 :

I don’t disagree at all, the problem is that the people who need that extra money needs it right then not after taxes have been filed.

vicdude250 :

I wish someone else talk about it. I constantly have to educate people about pre taxed earned income is not the same as net income

dads80s🇨🇦 :

jumping to another tear is not a thing. you only pay larger taxes on portions above the tear

Rabbit Hole 2020 :

RickSee :

yes but combined can reach over 50 pct marginal at which point the extra work input in only returns me less than half so the extra stress isn't worth it