In Canada, we pay income taxes on our salaries. The amount your employer pays you is not what you’ll eventually take home, as taxes and other deductions will be made on your salary before you can deposit your paycheque. This is referred to as your “net” income.
It’s essential to understand your net income in Newfoundland and Labrador as the amount of taxes you pay varies by province. Moreover, knowing how much money you’re bringing in versus what you’re paying in bills and other monthly expenses can help you better budget.
Read on to find out how to calculate your net salary in Newfoundland and Labrador so you know exactly how much money you have to cover all your monthly expenses.
How To Calculate Your Net Salary in Newfoundland & Labrador
Calculating your take-home pay in Newfoundland and Labrador is easy. Follow these steps to determine how much you actually take home:
1. Determine Your Gross Salary
You can find your pre-tax income on your pay stubs. This is the amount you’re paid by your employer before taxes and deductions are subtracted.
2. Tally Up Your Deductions
In addition to your pre-tax pay, your pay stubs should also detail any deductions made. These can include the following:
- Income taxes
- Union dues
- Health plan costs
- Employment insurance
- Vacation pay contributions
- Employer Registered Pension Plan (RPP) contributions
- RRSP contributions
- Childcare expenses
What Deductions Can Affect My Take Home Pay in Newfoundland & Labrador?
You’ll be subject to both federal and provincial income taxes, which will be deducted from your pre-tax pay. In addition, you may also be required to pay into the following:
- Employment Insurance (EI). This EI benefit provides temporary financial relief to those unable to work for a variety of reasons, including involuntary job loss or maternity leave.
- Canada Pension Plan (CPP). This benefit is Canada’s earnings-based social insurance program that you contribute to throughout your employment years. Once you retire, the CPP will pay you a regular income. Quebec has its own version of the program called the Quebec Pension Plan (QPP).
3. Calculate Your Net Pay
To determine your net monthly salary in Newfoundland and Labrador, subtract the sum of your monthly deductions from your monthly gross pay, both of these numbers will be indicated on your paystubs. Do note, if you’re paid bi-weekly or semi-monthly, you’ll need to multiply your numbers by 24 for semi-monthly and 26 times for bi-weekly to get your yearly net pay.
Take-Home Pay Across Canada
- Calculate Your Take-Home Pay In Nova Scotia
- Calculate Your Take-Home Pay In PEI
- Calculate Your Take-Home Pay In Saskatchewan
- Calculate Your Take-Home Pay In Newfoundland and Labrador
- Calculate Your Take-Home Pay In Alberta
- Calculate Your Take-Home Pay In British Columbia
- Calculate Your Take-Home Pay In Ontario
Tax Rate In Newfoundland & Labrador
A significant percentage of the deductions made to your gross income includes federal and provincial taxes, as mentioned. In Newfoundland and Labrador, your net salary is calculated by subtracting these taxes from your annual pre-tax pay. To calculate your net salary, you’ll need to know what the tax rates are in Newfoundland and Labrador.
Federal Income Tax Rates
The amount you must pay in federal income taxes depends on your gross salary. For the 2022 tax year, the Canadian federal tax rates are as follows:
| Federal Tax Rate | Federal Income Tax Brackets |
| 15% | Applicable to taxable income up to $57,375 |
| 20.5% | Applicable to taxable income over $57,375 up to $114,750 |
| 26% | Applicable to taxable income over $114,750 up to $177,882 |
| 29% | Applicable to taxable income over $177,882 up to $253,414 |
| 33% | Applicable to taxable income over $253,414 |
Newfoundland & Labrador Provincial Income Tax Rates
Like federal income taxes, your gross salary will determine your provincial tax rate in Newfoundland and Labrador. These tax rates may change year over year. For the 2022 tax year, the tax rates in Newfoundland and Labrador are as follows:
| Newfoundland And Labrador Tax Rate | Newfoundland And Labrador Income Tax Brackets |
| 8.7% | Applicable to taxable income up to $41,457 |
| 14.5% | Applicable to taxable income over $41,457 up to $82,913 |
| 15.8% | Applicable to taxable income over $82,913 up to $148,027 |
| 17.8% | Applicable to taxable income over $148,027 up to $207,239 |
| 19.8% | Applicable to taxable income over $207,239 up to $264,750 |
| 20.8% | Applicable to taxable income over $264,750 up to $529,500 |
| 21.3% | Applicable to taxable income over $529,500 up to $1,059,000 |
Calculating Your Net Take-Home Salary In Newfoundland & Labrador
Once you determine which tax bracket you’re in and the applicable tax rate on both a federal and provincial level, you can calculate your net salary. The calculation is as follows:
| GROSS SALARY – FEDERAL TAXES – PROVINCIAL TAXES – CPP – EI = NET SALARY |
Let’s compare the take-home pay of a $30,000 salary versus an $80,000 salary in Newfoundland and Labrador:
| Gross Salary | Federal Taxes | Provincial Taxes | Total Taxes Paid | Net Annual Salary |
| $30,000 | $1,953 | $1,613 | $5,484 | $24,516 |
| $80,000 | $10,820 | $8,238 | $23,114 | $56,886 |
Net Salary By Income In Newfoundland & Labrador
The same federal tax brackets are applicable in all provinces and territories in Canada. However, the provincial tax will vary. The following chart estimates how different income levels in Newfoundland and Labrador affect the total taxes and CPP and EI contributions paid:
| Gross Salary | Federal Tax Deduction | Provincial Tax Deduction | CPP Deduction | EI Deduction | Total Taxes Paid | Net Salary |
| $30,000 | $4,009 | $2,437 | $1,511 | $474 | $8,431 | $21,569 |
| $60,000 | $8,721 | $6,066 | $3,221 | $948 | $18,956 | $41,044 |
| $100,000 | $16,878 | $12,125 | $3,500 | $953 | $33,455 | $66,545 |
| $150,000 | $29,857 | $20,229 | $3,500 | $953 | $54,538 | $95,462 |
Newfoundland & Labrador Tax Credit That Can Affect Income Taxes
There are ways to reduce how much you’re required to pay in income taxes by lowering your taxable income. Newfoundland and Labrador offer a handful of tax credits and benefits that you may qualify for to reduce the amount of provincial tax you would have to pay, including the following:
- Physical activity tax credit. Parents can claim up to $2,000 per household to offset the cost of putting their children in sports and other eligible activities.
- Newfoundland and Labrador income supplement and seniors’ benefit. These refundable tax credits are available to low-income individuals, families, and senior citizens, and are paid along with the quarterly GST/HST credit.
- Low-income tax reduction. Canadians who fall under the lower income tax bracket may qualify for this tax reduction. As of the 2021 tax year (the latest information available), the maximum income threshold for this credit is $43,260.
Are you a parent in NL? You may qualify for the Newfoundland and Labrador Child Benefit.
What Is The Minimum Wage In Newfoundland & Labrador?
As of October 1, 2022, the minimum wage in Newfoundland and Labrador is $13.70. Based on this hourly rate, the weekly pay based on 40 hours worked would be $548, and the annual salary would be $27,400, assuming 50 weeks worked (with 2 weeks holidays per year).
The taxes paid and net pay based on the current minimum wage would be as follows:
| Gross Salary | Federal Tax Deduction | Provincial Tax Deduction | CPP Deduction | EI Deduction | Total Taxes Paid | Net Salary |
| $27,400 | $3,648 | $2,228 | $1,362 | $433 | $7,671 | $19,730 |
Newfoundland & Labrador Average Salary
According to Statistics Canada, the average and median salaries in Newfoundland and Labrador are as follows:
- Average Income in Newfoundland and Labrador: $51,300
- Median Income in Newfoundland and Labrador: $40,500
Newfoundland & Labrador Salary FAQs
What’s the difference between ‘gross’ and ‘net’ salary?
How much taxes will I pay if I make $50,000 in Newfoundland and Labrador?
What’s the benefit of knowing your gross pay and net pay?
Final Thoughts
Your take-home pay is much different from your gross pay in Newfoundland and Labrador after all income taxes and deductions have been made. Understanding what your net salary is can help you come up with an accurate budget and keep your finances healthy.
