Salary vs Dividend Calculator

Compare the tax impact of paying yourself salary vs dividends.

Amount to Pay Yourself — gross amount from corporation

Province

Other Personal Income — optional

Recommended Option

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Salary

Gross Salary{{ grossSalaryStr }}

Employee CPP−{{ empCppStr }}

Federal Tax−{{ salFedStr }}

Provincial Tax−{{ salProvStr }}

Your Take-Home{{ salaryTakeHomeStr }}

Dividend

Corporate Profit Needed{{ corpProfitStr }}

Corporate Tax−{{ corpTaxStr }}

Dividend Received{{ dividendStr }}

Personal Dividend Tax−{{ divTaxStr }}

Your Take-Home{{ dividendTakeHomeStr }}

Other Considerations

RRSP Room Created (Salary){{ rrspSalaryStr }}

RRSP Room Created (Dividend)$0

Employer CPP Cost (Salary){{ employerCppStr }}

CPP Benefits EligibilitySalary Only

Note: This calculator uses the small business corporate tax rate and non-eligible dividends. Results may vary based on your specific situation, eligible dividend income, and other factors. Consult with an accountant for personalized advice.

Salary vs Dividend: How to Pay Yourself

As an incorporated business owner, you can pay yourself through salary or dividends — each has different tax implications. Salary is a deductible expense for your corporation, subject to CPP contributions, and creates RRSP contribution room. Dividends are paid from after-tax corporate profits, have no CPP, and receive preferential tax treatment through the dividend tax credit.

The “right” answer depends on your income level, province, need for RRSP room, and whether you want CPP retirement benefits. Generally, the tax system is designed so both options result in similar after-tax income — a concept called “integration.”

Disclaimer: This calculator provides estimates for general informational purposes only using 2025 tax rates and the small business corporate tax rate for non-eligible dividends. Results may vary based on eligible dividend income, other deductions, tax credits, and your specific situation. This is not tax advice — consult a qualified accountant for personalized recommendations.