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Self-Employment Tax Estimator — Canada 2026

Estimate only — not tax or financial advice. For an unincorporated sole proprietor with only self-employment income. Self-employed Canadians pay both the employee and employer shares of CPP (11.90% total, plus 8% CPP2 tier) — half is a deduction and the rest earns a credit, which this estimator models. No EI (self-employed EI is opt-in for special benefits). Does not include GST/HST collection or instalment interest. Source: CRA 2026.

How it works

As a sole proprietor, your business profit is taxed as personal income — same federal and provincial brackets — with three big differences from an employee. 1) CPP is doubled: you pay both halves, 11.90% on earnings between $3,500 and $74,600 in 2026 (maximum $8,460.90), plus 8% on the CPP2 band to $85,000 (maximum $832). The employer half is a deduction from income; the employee half earns a non-refundable credit. 2) No EI unless you opt in for special benefits (parental, sickness) — you cannot collect regular EI on lost work. 3) No employer withholds tax, so the CRA will usually require quarterly instalments once your net tax owing exceeds $3,000 ($1,800 in Quebec).

Worked example

On $70,000 of net self-employment income in Ontario in 2026, this estimator shows roughly $7,914 of CPP (both halves), about $10,175 of combined income tax after the CPP deduction and credits, and take-home of roughly $51,912 — a “set aside” share of about 26% of every dollar. That percentage, recalculated at your real income, is the number to automate into a separate tax account. Full guide: Self-Employed in Canada? Taxes, CPP and What to Set Aside.

Frequently asked questions

How much should I set aside from each payment?

Use the percentage this calculator gives you at your expected annual income, and sweep it to a separate savings account with every invoice paid. Recheck mid-year — CPP maxes out partway through the year at higher incomes, which lowers your marginal set-aside later in the year.

When do I have to register for GST/HST?

Once your taxable revenue passes $30,000 over four consecutive calendar quarters, registration is mandatory. Many register voluntarily earlier to claim input tax credits.

Should I incorporate?

Incorporation can defer tax when you earn well above what you need to live on, but adds accounting and legal costs. That decision needs a professional with your full picture — this estimator covers the unincorporated case.

Related: Take-Home Pay Calculator · CPP & EI Calculator · Self-employment guide