Australia vs Canada: Tax Comparison

Compare income tax rates and take-home pay between Australia and Canada

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On a $100,000 salary, you'd take home $71,963 in Australia versus $71,109 in Canada (Ontario) — a difference of $854/year ($71/month).

Tax Breakdown Comparison

Australia

2025-26 tax year

Lower Tax

Take-Home Pay

$71,963

$5,997/mo

Effective Rate

28.0%

of gross

Gross$100,000
Income Tax -$24,537
Social Contributions -$2,000
Surcharges -$1,500
Total -$28,037

Canada

2025 tax year

Take-Home Pay

$71,109

$5,926/mo

Effective Rate

28.9%

of gross

Gross$100,000
Income Tax -$16,337
Ontario Tax -$7,236
Social Contributions -$4,018
Surcharges -$1,300
Total -$28,891

Effective Tax Rate by Income

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Shows effective tax rate (total tax / gross income) at different income levels in USD

Life & Taxes

What it's like to live and earn in each country

Sunsets vs Snowshoes

Aussies and Canucks often swap hemispheres in search of a lifestyle shake-up, whether it's chasing the endless surf of the Gold Coast or the rugged mountain peaks of the Rockies. While families love the safe, suburban stability of both nations, Australia tends to attract the sun-seeking digital nomad, whereas Canada is a magnet for those craving a cozy, bustling cultural mosaic.

The Daily Grind

Life in Australia feels like a perpetual outdoor brunch with high wages and a relaxed 'no worries' attitude, though you'll pay a premium for that coastal sunshine. In Canada, particularly in hubs like Ontario, life is a bit more fast-paced and urban, defined by world-class poutine, polite neighbors, and a slightly lower cost of living that makes city life more accessible.

The Taxman's Tale

Australia keeps it simple with a single national income tax system, meaning your take-home pay doesn't change if you move from Sydney to Perth. Canada plays a different game; you'll deal with both federal and provincial layers, like in Ontario where surtaxes and health premiums add an extra layer of complexity to your annual filing.

Safety Nets and Perks

Your taxes go to work differently in each place: Australians contribute to the Medicare Levy for healthcare, while their retirement is bolstered by an employer-paid superannuation system that grows quietly in the background. Canadians see deductions for the Canada Pension Plan and Employment Insurance, ensuring a robust social safety net that protects you through every season of life.

The Bottom Line

If you want a straightforward tax bill and mandatory retirement savings paid by your boss, the land down under is your winner. However, if you prefer lower top-tier tax rates and don't mind navigating provincial surcharges for the sake of a vibrant, North American lifestyle, Canada might just be your perfect match.

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Australia vs Canada: Tax System Details

Australia

Tax Year
2025-26
Currency
AUD
Key Assumptions
  • -Tax year used is 2025/26 (ending 30 June 2026).
  • -Medicare Levy Surcharge (MLS) is included as a surcharge and assumes the worker does not have private hospital health insurance.
  • -The 2% Medicare Levy is modeled as a social contribution at a flat rate, assuming income exceeds the low-income threshold.
  • -The Low Income Tax Offset (LITO) is simplified to a single linear phase-out starting at 37,500 AUD.
  • -Employer mandatory superannuation contributions (12%) are excluded per the workforce profile requirements.

Canada

Tax Year
2025
Currency
CAD
Region Used
Ontario
Key Assumptions
  • -Ontario used as the representative sub-national region.
  • -2025 federal PIT rates reflect draft legislation reducing the lowest rate to 14.5%.
  • -Federal basic personal credit is indexed and tapered based on income (CAD 2,339 for earners up to 177,882, reducing to 2,108 for learners above 253,414).
  • -Canada Employment Amount credit (max 213) is excluded from the relief object but typically applies to employees.
  • -CPP and EI contributions are based on 2025 limits; enhanced CPP is deductible while the base portion typically qualifies for a tax credit.
  • -Ontario sub-national brackets and basic personal credit are estimated based on indexed 2024 rates as 2025 specific subnational tables for all brackets are not fully provided in the source excerpt.

Calculation Methodology

What's Included

  • Federal/national income tax
  • State, provincial, or local taxes
  • Social security contributions
  • Healthcare levies (where mandatory)
  • Additional surcharges

Assumptions

  • Single filer, no dependents
  • Employment income only
  • Standard deductions applied
  • Age 35 (where relevant)
  • No special tax credits