A marginal rate is the share of the next dollar of income that goes to tax. It is not the share of all income that goes to tax, which is the average rate. Both are explained in income tax brackets. The marginal rate is the one that values an RRSP deduction, a withdrawal, or a raise.
Ordinary income, 2026
In Ontario the federal rate, the Ontario rate and the Ontario surtax are added into one combined rate. The federal brackets run from 14% to 33%.[1] Ontario's run from 5.05% to 13.16%.[2] Ontario tax above two thresholds is increased by 20% and then by a further 36%, so the Ontario part of the rate is multiplied by 1.2 and then by 1.56.[3]
The combined rates for 2026, worked out from those brackets, the basic personal amounts (the federal one shrinking between $181,440 and $258,482) and the surtax, with the Ontario Health Premium left out, are below.[4][5]
| Taxable income from | Combined rate |
|---|---|
| $0 | 19.05% |
| $53,892 | 23.15% |
| $58,524 | 29.65% |
| $94,902 | 31.48% |
| $107,786 | 33.89% |
| $111,810 | 37.91% |
| $117,046 | 43.41% |
| $150,001 | 44.97% |
| $181,441 | 48.26% |
| $220,001 | 49.82% |
| $258,483 | 53.53% |
Each step is a federal or Ontario bracket starting, or Ontario tax passing a surtax threshold. The step above $117,045 is the federal rate moving from 20.5% to 26%.
Capital gains and dividends
Investment income is taxed differently, so the top rate depends on its kind. For income over $258,482 in Ontario, excluding the health premium:[1]
- Interest and other ordinary income: 53.53%.
- Capital gains: 26.76%, which is the 53.53% rate on the taxable half. See capital gains.[6]
- Eligible dividends: 39.34%, after the gross-up and the dividend tax credit. See dividends.[7][8][9]
- Non-eligible dividends: 47.74%.[10][11][12]
What All the Numbers does
All the Numbers does not look these rates up, here or in a plan. The figures on this page are computed from the rules, and in a plan it works out each person's tax from the brackets, credits and surtax every year, so the marginal rate is whatever those produce at that income. The brackets grow with inflation after 2026; see tax brackets after 2026.
Because tax is per person, two people in one household can sit on different marginal rates in the same year.
What it does not do
Rates are for Ontario in 2026 only. Credits that fall away as income rises, such as the age amount or Ontario's low-income credits, make the real cost of an extra dollar higher in some income ranges than the table shows. The OAS recovery tax does the same.