Ontario Personal Tax Brackets

Definition

Ontario personal income tax is levied under the Taxation Act, 2007 (Ontario) on the taxable income of individuals resident in Ontario at the end of the tax year. Ontario has five graduated tax brackets indexed annually for inflation. The brackets are separate from federal brackets: an Ontarian computes Ontario tax on line 428 of the T1 using the Ontario tax credits schedule (ON428), then adds the Ontario surtax and the Ontario Health Premium (OHP). The T1 return is filed with the CRA, which administers Ontario personal tax under the Canada-Ontario Tax Collection Agreement.

Key rules

• Ontario personal tax brackets for 2026 (approximate; confirm final indexation):
  • 5.05% on taxable income up to $55,867
  • 9.15% on income $55,868 to $111,733
  • 11.16% on income $111,734 to $150,000
  • 12.16% on income $150,001 to $220,000
  • 13.16% on income over $220,000
• Ontario has additional layers on top of the bracket rates: the Ontario surtax (20% and 36% of Ontario tax above thresholds) and the Ontario Health Premium (up to $900 annually, based on taxable income).
• The combined top marginal rate in Ontario for 2026, including federal tax (33%), the Ontario top bracket (13.16%), and the surtax, is approximately 53.53% on ordinary income above $253,414. Eligible dividends top out around 39.34%; non-eligible dividends near 47.74%.
• Bracket thresholds are indexed for inflation each year. Confirm the 2026 indexed thresholds on the CRA's personal tax payable schedule or ON428.
• Ontario tax credits include the Ontario Trillium Benefit, the non-refundable Ontario Basic Personal Amount, age amount, CPP/QPP and EI credits, pension income amount, and others listed on Form ON428.

Example

An Ontario resident earns $180,000 of employment income in 2026. Ontario tax before credits, using the 2026 brackets:

After the Basic Personal Amount non-refundable credit and other applicable credits, and the 20% / 36% Ontario surtax on amounts above the surtax thresholds, the taxpayer's net Ontario tax payable is computed on line 428.

Common mistakes

• Treating Ontario brackets as identical to federal brackets. The bracket thresholds and rates differ; taxpayers must compute Ontario tax separately on Form ON428.
• Forgetting the Ontario surtax. The combined marginal rate at $150,000 is not simply 12.16% plus federal; the 20% surtax above approximately $5,554 of Ontario tax applies, effectively increasing the top rate.
• Missing the Ontario Health Premium. The OHP is an additional layer of up to $900 per year that applies starting at around $20,000 of taxable income.
• Applying indexation figures from the wrong year. Indexation usually comes in at 2% to 4% per year; verify the 2026 Form ON428 for exact figures.

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