Northwest Territories Income Tax Calculator
Easily estimate take home pay after income tax so you can have an idea of what to possibly expect when planning your budget
Last reviewed on January 29, 2023
Results
Income Before Tax
Take Home Pay
Total Tax
Average Tax Rate
$ = Canadian Dollar
Income Before Tax
Federal Income Tax
Federal Non-Refundable Tax Credits
Quebec Federal Tax Abatement
Territorial Income Tax
Territorial Non-Refundable Tax Credits
Territorial Surtax
Territorial Non-Refundable "Tax Reduction"
Canada Pension Plan (CPP)
Employment Insurance (EI)
Quebec Pension Plan (QPP)
Quebec Parental Insurance Plan (QPIP)
Quebec Health Services Fund
Ontario Health Premium
Total Tax
Take Home Pay
Total Deductions
Average Tax Rate
Table of Contents
Summary
Enter your employment income into the income tax calculator above to estimate how taxes in Northwest Territories, Canada may affect your finances. You'll then get your estimated take home pay, an estimated breakdown of your potential tax liability, and a quick summary down here so you can have a better idea of what to possibly expect when planning your budget.
To learn more about Northwest Territories, its income tax, and tax brackets, so that you can get a deeper understanding of how your budget and finances may be affected, scroll down to the detail section below!
Frequently Asked Questions
What is the income tax rate in Northwest Territories?
The territorial income tax rate in Northwest Territories is progressive and ranges from 5.9% to 14.05% while federal income tax rates range from 15% to 33% depending on your income. This income tax calculator can help estimate your average income tax rate and your take home pay.
How many income tax brackets are there in Northwest Territories?
The territorial income tax system in Northwest Territories has four different tax brackets. For more details, check out our detail section.
How to Calculate Northwest Territories Net Income
Deep inside Canada lies one of nature’s most pristine environments - the frozen expanse known as the Northwest Territories. This remote region has been inhabited by Indigenous peoples since time immemorial and continues to capture the imagination of explorers and adventurers to this day.
Beyond its breathtaking natural beauty lie intricate systems that govern how inhabitants survive the harsh climate and make ends meet. One such system involves navigating taxes - specifically income tax - which plays an integral role in sustaining public services and infrastructure necessary for life in the territories.
The calculation of net income involves a careful consideration of various taxes and rates.
The first is the territorial income tax system in the Northwest Territories, which is based on a progressive model. Different brackets segment your income into different ranges, with lower brackets attracting lower tax rates, while higher brackets face higher rates. Ranging from a modest 5.9% to a peak of 14.05%, these rates reflect the progressive nature of the system and help fund essential public services and infrastructure throughout the territory.
To better understand how these tax brackets are structured, let's delve into the specifics. The following table outlines the various income thresholds and their corresponding tax rates within the Northwest Territories:
Northwest Territories Income Tax Brackets
For 2022 tax year
| Taxable Income (CAD) | Tax Rate |
|---|---|
| First 45,462 | 5.9% |
| From 45,462 to 90,927 | 8.6% |
| From 90,927 to 147,826 | 12.2% |
| From 147,826 onwards | 14.05% |
Unlike the standard practice of tax deductions found in many jurisdictions around the world, the Northwest Territories, along with the rest of Canada, takes a different approach, focusing on tax credits. These credits provide relief against the tax owed, helping to reduce the overall tax liability.
It's worth noting that most tax credits in this territory are non-refundable, meaning that if the total amount of tax credits exceeds the income tax owed, you will not receive a refund for the difference. In such cases, your income tax liability would simply be reduced to zero.
When it comes to tax credits, the Northwest Territories predominantly employs an "amount" framework. These credits, expressed as specific monetary figures, are not directly subtracted from your income tax. Instead, they are first multiplied by the rate applicable to the lowest tax bracket before being applied as a reduction. In essence, they function similarly to traditional deductions, albeit with a subtle adjustment that aligns with the territory's unique tax structure and helps to more so benefit low income earners.
For the tax year 2022, residents of the Northwest Territories can benefit from a non-refundable basic personal amount of $15,609. This amount serves as a baseline level of tax relief.
Residents in the Northwest Territories are also eligible for an easy to access cost of living tax credit which varies depending on your income while maxing out at $942 to help offset the high cost of living in the Northwest Territories.
As an integral part of Canada, the Northwest Territories is not exempt from the federal government's expectation to contribute a portion of your income through federal income tax. This form of taxation closely parallels the territorial income tax system within the region. For more details, check out our comprehensive section below.
Social Security
Individuals residing in the Northwest Territories are also responsible for social security taxes. Social security in most of Canada encompasses two main components: the Canada Pension Plan (CPP) and Employment Insurance (EI). These programs require contributions from eligible individuals, with the current rates set at 5.7% for CPP and 1.58% for EI. It's important to note that there are maximum limits on the income subject to these contributions.
To help alleviate the financial burden of social security contributions, tax credits are available at both the territorial and federal levels. These credits serve as valuable offsets, reducing the overall tax liability. However, it's important to be aware that these credits have specific limits, ensuring they are applied within the appropriate boundaries to provide meaningful relief.
Sources:
More From Investomatica:
For sales tax, please visit our Northwest Territories Sales Tax Rates and Calculator page.
Calculate Your Income Tax in Other Provinces and Territories
Calculate Your Income Tax in Other Parts of North America
Disclaimer
- The content shown on this page is strictly for educational purposes only. It does not represent advice nor is it a substitute for a professional advisor.
- Estimated results are just estimates. They are not a guarantee of future results.
- Tax situations vary widely and calculations can get very complex. This income tax calculator only provides a rough estimate according to the most common scenarios for standard employment income that comes from an employer. If you are self-employed, your taxes might differ.
- There may be additional deductions, credits, exemptions, allowances, reliefs, etc depending on many factors. Some factors are about your family such as the number of dependents, children, relatives, parents, etc. Other factors may include mortgage payments, property depreciation, charitible donations, additional voluntary retirement contributions, etc. Whether or not you are handicapped and/or disabled may also sometimes be an additional factor.
- Depending on region and jurisdiction, salary bonuses may be treated and taxed differently from standard salary.
- Calculators from other sites may show slightly different numbers due to different deductions/credits being included or they are based on data from a different year.
- Generally, we review changes once a year since tax codes usually change once a year. If you notice a major miscalculation or error with our income tax calculator (most likely caused by a typo somewhere), feel free to direct message us on twitter and let us know. However, if you have specific questions about your own personal situation, please consult a licensed tax professional.
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