Rental income tax calculator (2026)

With $60,000 of other income, $18,000 of net rental income in Ontario in 2026 means $5,238 of income tax, so you keep $12,762 of the rent, or $1,063 per month. The tax is 29.1% of the net rental income, because the rent stacks on top of your other income and is taxed at the marginal rates that apply above it.

Net rental income is taxed as ordinary income. You report gross rent minus eligible expenses on Form T776, and the net amount is added to your other income and taxed at your combined federal and provincial marginal rates. There is no separate rental tax rate, and you pay tax only on the net amount, not on the total rent collected. That is why the tax depends on your other income, not just the size of the rent.

No. CPP and EI are based on employment income, and rental income is not pensionable or insurable earnings, so no CPP, EI or QPIP is deducted from it and rental income does not change the CPP or EI on your employment income. This calculator therefore shows income tax only. If your rental activity is run as a business, the treatment can differ; this calculator models personal rental income reported on Form T776.

Yes, on the same rental income. $18,000 of net rental income with $60,000 of other income costs $6,162 in tax in Quebec in 2026, against $5,238 in Ontario, a difference of $924. Quebec's provincial income tax rates are higher at these incomes, so the same rent costs more there, even though the federal tax on the rent is lower in Quebec because of the federal abatement.

With $40,000 of other income, $12,000 of net rental income in British Columbia in 2026 means $2,198 of income tax, so you keep $9,802, or $817 per month. On the same inputs, rent costs less tax in British Columbia than in Ontario or Quebec, because British Columbia's provincial rates are lower at these incomes.

Any reasonable expense incurred to earn the rent, including mortgage interest (not principal payments), property tax, insurance, utilities, repairs and maintenance, condo fees and advertising. You deduct those expenses on Form T776 and pay tax only on what is left, which is the net rental income this calculator asks for. Capital cost allowance, the depreciation deduction for the building, is optional and is not modelled here: claiming it lowers the tax now, but the amount claimed is generally added back to income as recapture when you sell.

Then you have a rental loss, which can generally offset your other income in that year, subject to the CRA's rules on rental losses. This calculator does not model a loss: it takes net rental income of zero or more, so enter your net rental income after expenses and use the result only when the property earned more than it cost. Selling the property is a separate event: the gain on a sale is a capital gain, covered by the capital gains tax calculator, and any capital cost allowance claimed is recaptured as ordinary income.