Enter your business profit and province to estimate federal tax, provincial tax and both halves of CPP, and how much to put aside each month. No account needed.
Updated
The short answer
Set aside 25% to 30% of your profit for tax and CPP if you earn $40,000 to $100,000 a year from self-employment, and about 20% below that. In Ontario in 2026, $60,000 of profit costs about $14,600: $5,155 federal tax, $2,724 Ontario tax and $6,724 CPP.
The CPP part surprises people: self-employed Canadians pay both halves, 11.9% of earnings between $3,500 and $74,600 in 2026.
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Income minus business expenses
So CPP isn't counted twice
Estimates only. Uses 2026 federal, provincial and territorial rates, the basic personal amount and CPP. It ignores other credits and deductions (RRSP, tuition, medical, low-income reductions outside Ontario and BC) and EI. If you enter T4 income, the results are the extra tax and CPP your self-employment income adds.
Quebec is an approximation: it includes QPP and the 16.5% federal abatement, but not QPIP premiums, the health services fund contribution or Quebec-only credits.
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Here is what the calculator gives for a sole proprietor in Ontario with no other income, at three profit levels. "Profit" means net self-employment income: what clients paid you minus business expenses, the figure on line 9946 of Form T2125.
| Net income | Federal | Ontario | CPP | Total | Rate | Per $1,000 | Monthly |
|---|---|---|---|---|---|---|---|
| $30,000 | $1,455 | $1,000 | $3,154 | $5,609 | 18.7% | $187 | $467 |
| $60,000 | $5,155 | $2,724 | $6,724 | $14,603 | 24.3% | $243 | $1,217 |
| $90,000 | $10,666 | $5,414 | $9,293 | $25,373 | 28.2% | $282 | $2,114 |
We checked these three rows, plus British Columbia at $45,000, Alberta at $90,000, Manitoba and Quebec at $60,000, against Wealthsimple's 2026 tax calculator in September 2026. Totals agreed within 1%.
The lowest federal rate dropped to 14% for 2026, down from 15% in 2024 (it was 14.5% for 2025, the year of the change).
| Taxable income | Federal rate |
|---|---|
| Up to $58,523 | 14% |
| $58,523 to $117,045 | 20.5% |
| $117,045 to $181,440 | 26% |
| $181,440 to $258,482 | 29% |
| Over $258,482 | 33% |
The federal basic personal amount is $16,452 for 2026, reduced gradually to $14,829 for net incomes between $181,440 and $258,482.
| Province or territory | Basic personal amount | Lowest rate | Top rate |
|---|---|---|---|
| Alberta | $22,769 | 8% | 15% |
| British Columbia | $13,216 | 5.6% | 20.5% |
| Manitoba | $15,780 | 10.8% | 17.4% |
| New Brunswick | $13,664 | 9.4% | 19.5% |
| Newfoundland and Labrador | $13,094 | 8.7% | 21.8% |
| Nova Scotia | $11,932 | 8.79% | 21% |
| Northwest Territories | $18,198 | 5.9% | 14.05% |
| Nunavut | $19,659 | 4% | 11.5% |
| Ontario | $12,989 | 5.05% | 13.16% (plus surtax and Health Premium) |
| Prince Edward Island | $15,000 | 9.5% | 20% |
| Quebec | $18,952 | 14% | 25.75% |
| Saskatchewan | $20,381 | 10.5% | 14.5% |
| Yukon | $16,452 (matches federal) | 6.4% | 15% |
A few 2026 changes to know: British Columbia raised its lowest rate from 5.06% to 5.6% and its tax reduction to $690; Newfoundland and Labrador raised its basic personal amount to $13,094; Prince Edward Island added a 20% bracket above $200,000; Manitoba kept its brackets at $47,000 and $100,000 without indexing. Ontario's surtax is 20% of Ontario tax over $5,818 plus 36% of Ontario tax over $7,446, and the Ontario Health Premium runs from $0 to $900 depending on taxable income.
Figures as of September 2026, from the CRA's 2026 tax rates and income brackets, the CRA's payroll deductions formulas (T4127, January 2026 and July 2026 editions) for basic personal amounts, Ontario and BC reductions and CPP, the CRA's CPP and CPP2 rate tables, Manitoba Finance, and Revenu Québec's 2026 rates and principal changes for 2026 (basic personal amount and QPP).
If you work for an employer, they match your CPP. When you work for yourself, you are both, so you pay both halves when you file, through Schedule 8 of your return (line 42100). You don't pay CPP on the first $3,500 of earnings, and you stop at the yearly maximums.
If you also have a job, the CPP your employer deducts counts toward the same maximum, so a side hustle on top of a $74,600-plus salary adds no first-tier CPP at all. In Quebec you pay QPP instead: 6.3% + 6.3% = 12.6% on the same earnings, plus the same 8% second tier.
Self-employed people don't pay EI unless they choose to. You can register with Service Canada for EI special benefits: maternity, parental, sickness, compassionate care, and family caregiver benefits. Regular (job-loss) EI isn't part of the program.
It is mainly worth it if you expect to take parental leave. EI premiums aren't included in the calculator's total. Details are on Service Canada's EI for self-employed people page (checked September 2026).
If you're registered for GST/HST, the tax you collect isn't income and isn't covered by this calculator; set it aside separately until you remit it. The GST/HST guide explains the $30,000 small supplier threshold. To see how your business income flows onto your return line by line, read T2125 explained.
It depends on your profit and province. In Ontario in 2026, a sole proprietor with $60,000 of net self-employment income and no other income pays about $5,155 in federal tax, $2,724 in Ontario tax and $6,724 in CPP, about $14,600 in total, or 24% of profit. At $30,000 it is about 19%, and at $90,000 about 28%.
A common rule of thumb is 25% to 30% of your profit (income minus business expenses), which covers income tax and both halves of CPP for most one-person businesses earning $40,000 to $100,000. At lower profits 20% is often enough. If you also have a job, set aside more, because the side income is taxed at your top rate.
You pay both the employee and employer shares: 11.9% of net self-employment earnings between $3,500 and $74,600, up to $8,460.90, plus 8% CPP2 on earnings between $74,600 and $85,000, up to $832. Half of it is deductible, and the base part of the other half earns a tax credit, so the real cost is lower than the raw number.
Not unless you opt in. Self-employed Canadians can register for EI special benefits (maternity, parental, sickness, compassionate care and family caregiver benefits). In 2026 the premium is $1.63 per $100 of earnings, up to $1,123.07. You need to wait 12 months after registering before you can claim, and to claim in 2026 you needed $9,254 of net self-employment earnings in 2025.
Your side profit is added to your salary, so it is taxed at your highest bracket, and you owe CPP on it only until your combined earnings reach the yearly maximum. Enter your T4 income in the calculator and it shows the extra tax and CPP the side income adds, without counting the CPP your employer already deducted.
For the 2026 tax year, you have until June 15, 2027 to file, but any balance owing is due April 30, 2027. If your net tax owing is more than $3,000 in 2026 and was also more than $3,000 in 2025 or 2024 ($1,800 in Quebec), the CRA expects quarterly instalments on March 15, June 15, September 15 and December 15.
It is an approximation. It uses Quebec's 2026 brackets and basic personal amount, QPP instead of CPP, and the 16.5% federal abatement, but it leaves out QPIP premiums, the health services fund contribution and Quebec-specific credits, so a Quebec sole proprietor will usually owe somewhat more than it shows.
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Not ready? Try the free invoice generatorThis page is general information, not financial, legal, or tax advice. We gathered it from public sources (banks, payment providers, government agencies such as the CRA, and published industry rates), and it reflects our understanding when it was last updated. Rates, limits, fees, and rules change without notice, and your situation may differ from the general case.
Before you rely on anything here, do your own due diligence: confirm the details with the original source, and check that they are still current. For advice about your own finances, taxes, or legal position, hire a qualified professional such as an accountant, lawyer, or financial advisor. See our Terms for the full disclaimer. Last updated September 29, 2026.