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Gross pay and net pay are the two numbers that matter most on your pay stub — and they’re often very different.
Gross pay
Gross pay is your total earnings before any deductions — the salary figure in your offer letter, or your hourly rate times hours worked. It’s also the number your employer uses when calculating things like vacation pay or overtime.
Net pay
Net pay — also called take-home pay — is what’s left after federal tax, provincial tax, CPP/CPP2, and EI are deducted. This is the amount that actually gets deposited into your bank account.
Example
In this example, roughly 25% of gross pay goes to deductions — the exact percentage depends on your province, income level, and pay frequency.
Why the gap matters
When negotiating salary or budgeting, it’s easy to think in gross terms because that’s the number employers quote. But your actual spending power is determined by net pay — always budget based on take-home pay, not gross salary.
Calculate your own gross-to-net
+ Advanced options (overtime, bonus)
Independent estimate based on 2026 CRA federal/provincial payroll formulas, Revenu Québec figures, and published CPP/CPP2/QPP/QPP2, EI and QPIP rates. Not affiliated with the Canada Revenue Agency or the Government of Canada. Actual payroll may differ based on your employer’s specific deductions, benefits, TD1 claim amounts, and other factors. This tool does not constitute tax or financial advice.
Related guides
How Canadian Paychecks Are Calculated · Payroll Deductions Calculator