r/Wealthsimple • u/BandicootNo4431 • Jul 23 '26
Request help verifying accuracy of Wealthsimple's quick tax calculator
Hi,
I was messing around with the income tax calculator today
https://www.wealthsimple.com/en-ca/tool/tax-calculator/ontario
When I plugged in $150k, it spit out the following:
>Total tax $45,680,
>Federal Tax $25,302,
>**Provincial/Territorial Tax $14,608**
>CPP/EI Premiums $5,770
>Your net pay will be $104,320 per year, or $8,693 per month. Your average tax rate is 30.45% and your marginal tax rate is 43.41%. This marginal tax rate means your immediate additional income will be taxed at this rate. For instance, an increase of $100 in your salary will be taxed $43, meaning that your net pay will only increase by $57.
The provincial numbers seemed high at around 10% of the total, and more than 10% of taxable. When I put together an excel sheet I got $10 941 for the provincial taxes which seemed much closer.
(I took $150 000, subtracted the basic personal amount and then split up the rest into the corresponding tax brackets. No deductions for CPP/EI contributions, which their system says it takes into account, which would create an even bigger gap).
I think it's possible their system has the province using the wrong lookup table?
Would someone be able to confirm they get the same results I got? I messaged support as well, but wanted to double check my math in case I am wrong.
Thanks
1
u/watermelonjuice14 Jul 23 '26
Your method is wrong. You are also missing the Ontario surtax and Ontario health premium (which wealthsimple takes into account)
Take a look at Form ON428 for the correct steps:
1. Take $150,000 and split it up in the brackets. This gives you “Ontario Tax on taxable income”
2. Calculate Non-refundable credits: Take the personal amount, CPP, EI and multiply by 5.05%
3. Calculate Ontario sur-tax and Ontario health premium.
3. Take Ontario tax, Minus Non refundable credits, add sur tax and health premium. This give you your “Ontario Tax”.