If your income falls in a higher tax bracket, you will be taxed on the lowest tax bracket rate to the maximum for that bracket, on the second tax bracket to the maximum amount for that bracket, and so on progressively until all your income is taxed at each rate for each bracket that it spills into. Remember that there are different rates for federal and provincial/territorial taxes.

If you calculate your net income after deductions and compare it to the chart above, you will know how much tax you will need to pay. Find the tax brackets where your income falls. That being said, determining your average tax rate, which can be calculated by dividing your total tax payable by your gross income, is often far more helpful.

The tax rates for Ontario in 2022 are as follows: amounts earned up to $49,231 are taxed at 5.05%. Amounts above $49,231 up to $98,463 are taxed at 9.15%. For amounts $98,463 up to $150,000, the rate is 11.16%. Earnings $150,000 up to $220,000 the rates are 12.16%. Finally, earnings above $220,000 will be taxed at a rate of 13.16%.