Take-Home Pay

Tax & Income

The actual money that lands in your bank account after all deductions (taxes, CPP, EI) are taken from your gross salary. Also called net pay. This is what you actually have to spend.

Related Terms

Marginal Tax Rate

The tax rate you pay on your last dollar of income. If your marginal rate is 30%, every extra dollar you earn means you keep 70 cents and pay 30 cents in tax. This is different from your average tax rate because Canada uses tax brackets where you pay different rates on different portions of your income.

Gross Income

Your total income before any taxes or deductions are taken off. It's the number on your job offer or T4 slip.

CPP (Canada Pension Plan)

A mandatory Canadian government retirement plan. Both you and your employer contribute from your paycheque. When you retire (earliest age 60), you receive monthly payments for life. The more you contribute and the longer you wait to start collecting (up to age 70), the bigger your payments will be.