Does Canada use progressive tax brackets?

Yes, Canada uses a progressive income tax system where higher portions of income are taxed at higher rates. This means as your income increases, only the portion of income falling into a higher bracket is taxed at that higher rate, not your entire income. For 2024, federal tax rates range from 15% on income up to $55,867, to 33% on income over $246,752. Each province also has its own progressive tax system. For example, Ontario's top provincial rate is 13.16% on income over $220,000, which combines with the federal rate for a total top marginal rate of 49.53% for high earners in that province. The top marginal federal rate is 33.0%. This means your effective (average) tax rate is always lower than the top bracket rate you reach, because lower portions of your income are taxed at lower rates. Understanding this system is key to estimating your real tax burden when considering a move to Canada.