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How much should I set aside for taxes?
A panic-in-April-prevention tool. Estimates the cash you should reserve for federal and provincial income tax, CPP, and (if you're registered) GST/HST plus PST/QST. Uses simplified math — not a bracket-by-bracket calculation — so the output is a conservative range, not a promise.
The three things self-employed Canadians get wrong about taxes.
1. They don't separate GST/HST from income. The tax you collect is not yours. It's CRA's money you're holding. Move it to a separate account on receipt — that's how professional bookkeepers handle it.
2. They forget CPP doubles. Self-employed Canadians pay both halves: 11.9% on contributory income up to $71,300 (2025 YMPE), plus 8% on the CPP2 band between $71,300 and $81,200. That's on top of income tax, not instead of.
3. They base set-aside on gross, not net. Set aside a percentage of net self-employed income (gross minus business expenses). Setting aside 30% of every invoice is fine as a heuristic; just remember your real liability is on what's left after expenses.
Common questions
Why a range, not a single number?
Because Canadian tax depends on bracket placement, provincial rate, credits, RRSP contributions, and dozens of other line items we don't ask you about. A single number would be falsely precise. The ±5 percentage-point band absorbs most of that uncertainty for typical freelancer profiles in the $30K–$120K net income range.
How is this different from a US "self-employment tax" calculator?
Different system entirely. US freelancers pay SE tax (Social Security + Medicare, ~15.3%) plus federal/state income tax. In Canada the equivalents are CPP (11.9% + CPP2 on a narrower base) plus federal and provincial income tax. The brackets, credits, and contribution caps are all Canadian-specific. A US calculator will be wrong.
Should I make instalment payments to CRA?
If your net tax owing was more than $3,000 last year and is expected to be again this year, CRA generally expects quarterly instalments (March, June, September, December). The set-aside number this calculator produces is a reasonable basis for those — but the actual instalment notice CRA sends is what governs. Talk to an accountant if you're new to instalments.
What about provincial sales tax (PST/QST)?
If you're in BC, Manitoba, Saskatchewan, or Quebec and sell services or goods subject to provincial sales tax, you'll also need to register provincially and collect that tax on top of GST/HST. This calculator shows the provincial reserve when applicable, but each province administers its own threshold and rules — confirm before relying on it.
Does this work for incorporated consultants?
Not really. If you're incorporated, your corporation pays T2 corporate tax (currently ~12.2% combined federal + provincial on the first $500K of active business income in most provinces), and you separately pay personal tax on salary or dividends taken from the corp. The math is different enough that you need a corporate-specific calculator — this one assumes a sole proprietor.
Make the reserve automatic.
MapleBooks tracks your real reserve target against your real bank balance — and warns you when you're underfunded. Built specifically for Canadian freelancers.
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