How Much $68000 After Tax in Ontario?

Tax Rates

An individual earning $68,000 per year in Ontario would fall into the 29.65% marginal tax bracket for 2024. This means federal and provincial income taxes are calculated as follows:

  • Federal tax: 15% on the first $53,359 of taxable income, plus 20.5% on the next $53,360 to $106,717, plus 26% on the next $58,713 up to $165,430, plus 29% on the remainder up to $68,000.
  • Ontario tax: 5.05% on the first $45,142, plus 9.15% on the next $45,143 up to $90,287, plus 11.16% on the next $59,713 up to $150,000, plus 12.16% on the remainder up to $68,000.

The combined federal and Ontario marginal tax rate at $68,000 of taxable income is therefore 29.65% (20.5% federal plus 9.15% Ontario).

Take-Home Pay

After federal and provincial taxes as well as Canada Pension Plan (CPP) and Employment Insurance (EI) premium deductions, the take-home pay on a gross salary of $68,000 per year in Ontario is approximately $51,180 annually or $4,265 monthly.

This is calculated from the income tax calculator as follows:

  • Gross pay (annual): $68,000
  • Estimated federal tax: $12,360
  • Estimated provincial tax: $4,139
  • CPP contributions: $3,500
  • EI premiums: $953
  • Total deductions: $20,952
  • Net take-home pay (annual): $68,000 - $20,952 = $51,180

So the average tax rate is approximately 24.6% of gross income, with net monthly take-home earnings of $4,265.

Deductions

The main tax deductions and credits that would apply to a $68,000 salary in Ontario could potentially include:

  • Registered Retirement Savings Plan (RRSP) contributions – 18% of previous year's earned income up to $29,210 for 2024
  • Canada Pension Plan (CPP) premiums - 5.70% in 2024 up to $64,900 of pensionable earnings
  • Employment Insurance (EI) premiums - $1.58 per $100 of insurable earnings up to $60,300 for 2024
  • Eligible medical expenses above 3% of net income
  • Charitable donations
  • Tuition tax credits for post-secondary education
  • Public transit passes
  • Child care expenses
  • Disability supports expenses

The amount of applicable deductions and credits would depend on the individual's personal situation. An accountant or tax preparation software should be used to accurately calculate total deductions and optimize tax savings.

Comparison to Other Provinces

Compared to other provinces, Ontario has higher overall taxes on a $68,000 salary than Alberta, Saskatchewan, Manitoba, and British Columbia. But taxes are lower than in the Atlantic provinces and Quebec.

For example, based on 2024 tax rates:

  • Alberta would have a marginal rate of 25.14% and estimated take-home pay of $50,902 on $68,000 gross income
  • Saskatchewan would have a marginal rate of 26.52% and take-home pay of $49,968
  • Manitoba would have a marginal rate of 29.65% and take-home pay of $49,541
  • Quebec would have a marginal rate of 37.12% and estimated take-home pay of $42,832

So Ontario offers reasonable taxes and take-home pay relative to the rest of Canada, higher than western provinces but lower than eastern provinces.

Is $68,000 a Good Salary?

For a single individual with no children in Ontario, $68,000 represents a relatively good salary, providing an upper-middle income lifestyle. However, to determine if it is "good" depends greatly on individual circumstances.

Some key considerations on whether $68,000 constitutes a good salary in Ontario:

  • Provides approximate take-home pay of $4,265 per month after tax, CPP and EI deductions. This affords a comfortable standard of living.
  • The median household income in Ontario was $76,000 in 2020. So $68,000 exceeds the household median income level.
  • It is significantly higher than the average individual income of approximately $54,000 per year in Ontario as of 2020.
  • The salary places an individual in the top 30 percent of income earners in Ontario approximately, according to 2020 tax data.
  • $68,000 would be considered a good salary for a single individual renting in many cities besides Toronto or Ottawa. However, home ownership would still be difficult for a single person unless commuting from further suburbs.
  • For a household with children, two $68,000 earning spouses would provide a very comfortable standard of living in most Ontario cities.
  • Within Toronto, $68,000 would provide a moderate middle-class lifestyle if renting. Home ownership would require a dual income household in the Greater Toronto Area.

In summary, while $68,000 represents an enviable salary compared to average incomes in Ontario, it ultimately provides an upper-middle class lifestyle in most cities if you are single, or a comfortable middle-class lifestyle with a family, depending on debt levels and expenses. It exceeds median incomes meaning better off than over 50% of households. Within Toronto it affords reasonable comfort and options but not an affluent lifestyle.

Written By:
Salman Rundhawa
Salman Rundhawa is the founder of Filing Taxes. Salman provides valuable tax planning, accounting, and income tax preparation services in Toronto, Mississauga, Oakville, and Hamilton.

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