Determining your net take home pay in Canada is an important part of financial planning for individuals living and working in Yukon. Your take home pay represents the actual amount you receive in your paycheck after deducting taxes, benefits, and other contributions.
This guide will walk you through the key steps and calculations involved in figuring out your take home pay in Yukon using the most up-to-date information for 2025.
What is Gross Income in Yukon?
Gross income refers to your total income from all sources before any deductions or taxes are applied. It is the starting point for calculating take home pay in Yukon.
The five main components that make up gross income include:
- Employment income – This includes salaries, wages, bonuses, commissions, tips, vacation pay, taxable benefits and any other remuneration received from an employer. Employment income will be reported on your T4 slip.
- Self-employment income – Earnings from self-employed work, freelancing, side gigs, and small business income are included in your gross income. You must report these amounts on your tax return.
- Investment income – This includes interest, dividends, capital gains or losses, royalties, rental income, RRIF/RRSP withdrawals and taxable annuity payments. You will receive tax slips like T5 and T3 reporting this income.
- Pension income – Pension income such as CPP, OAS, employer pensions are taxable. You will receive a T4A slip for these amounts.
- Other income – Scholarships, bursaries, alimony, child support and government benefits like EI must also be reported and make up part of your gross annual income.
To calculate gross income, you simply need to add the amounts reported on all your tax slips and records from the above sources.
In other words, you have to report ALL income and verify amounts against your T4, pay stubs, business statements, investment records and any other documentation.
If you don’t report everything accurately, you risk unreported or underreported income, which can lead to audits, penalties, or even prosecution by the CRA. That’s why it’s essential to maintain clear and accurate records.
What are Tax Deductions in Yukon?
Tax deductions help reduce your taxable income by allowing you to subtract qualifying expenses. Lower taxable income results in lower income taxes.
Some of the common tax deductions available to Yukon residents include:
- Registered Retirement Savings Plan (RRSP) contributions – RRSP contributions can be deducted up to your allowable limit based on earned income reported on your Notice of Assessment.
- Child care expenses – Child care costs for a dependent under age 16 may be claimed. Limits based on number of children apply.
- Moving expenses – Costs incurred for moving 40+ kms closer to a new work location can be deducted. Distance limits apply.
- Employment expenses – Expenses like vehicle, travel, home office costs can be deducted against employment income, if meet CRA requirements.
- Spousal support payments – Payments made to a current/former spouse or common-law partner under a court order may qualify.
- Business losses – Self-employed individuals can deduct business losses to reduce income. Certain conditions apply.
- Union or professional dues – Annual dues paid for membership in a trade union or professional organization are often deductible.
- Other deductions – Interest on student loans, carrying charges and other expenses may apply.
It’s important to keep documentation for your deductions since the CRA might ask for receipts or proof to back up your claims.
How Do Non-Refundable Tax Credits Reduce Taxes?
Tax credits lower the amount of tax you owe, while deductions reduce your taxable income. Here are six federal non-refundable tax credits:
- Basic personal amount – $15,465 for 2024. Available to all residents earning income.
- CPP contributions – CPP amounts from paycheques can be claimed as a tax credit.
- EI premiums – A tax credit can be claimed based on your EI premium contributions.
- Tuition amount – Credit based on tuition fees paid for post-secondary schooling.
- Medical expenses – Qualifying medical bills over 3% of your net income.
- Charitable donations – Tax credits are provided for donations over $200 to registered charities.
In addition to federal credits, Yukon also offers the following non-refundable tax credits:
- Carbon tax credit – Credit for residents to offset carbon tax costs.
- Low-income family credit – For low-income individuals and families.
- Political contribution credit – A tax credit for political donations.
- Yukon child benefit – Credit for families with children under 18 years old.
When it’s time to calculate how much tax you owe, these credits are applied directly to your tax bill. This helps you pay less overall.
What Are the Federal and Yukon Tax Rates for 2025?
Canada and Yukon both use a marginal tax rate system based on income levels. Higher incomes are taxed at progressively higher tax rates.
For the 2025 tax year, the federal income tax rates in Canada are:
| Taxable Income | Federal Tax Rate |
| Up to $57,375 | 15% |
| $57,375 – $114,750 | 20.5% |
| $114,750 – $177,882 | 26% |
| $177,882 – $253,414 | 29% |
| Over $253,414 | 33% |
In addition to federal taxes, Yukon residents also pay territorial income tax. The Yukon tax rates and brackets for 2025 are:
| Taxable Income 2025 | Yukon Tax Rate |
| Up to $57,375 | 6.4% |
| $57,375 – $114,750 | 9% |
| $114,750 – $177,882 | 10.9% |
| $177,882 – $253,414 | 12.93% |
| $253,414 – $500,000 | 12.80% |
| Over $500,000 | 15% |
These rates apply separately at the federal and territorial levels, and together, they determine your total income tax payable.
How Are CPP, EI and Pension Contributions Deducted?
After income tax, there are 3 other common payroll deductions:
- CPP contributions: For 2025, the CPP contribution rate is 5.95% on pensionable earnings up to $71,300.
- EI premiums: The 2024 EI rate is 1.64%, applied to insurable earnings up to $65,700.
- Pension contributions: If you have an employer-registered pension plan, contributions based on your pension plan rules are deducted from your pay.
CPP, EI and pension amounts are shown separately on your pay stub and deducted after income tax.
How to Calculate Your Take Home Pay in Yukon: 10 Simple Steps
Now let’s go through 10 steps to calculate your take home pay in Yukon:
Step 1: Calculate total gross income
Step 2: Identify tax deductions to determine net taxable income
Step 3: Look up your federal and Yukon marginal tax rates
Step 4: Apply the rates to taxable income to determine the total income tax owing
Step 5: Subtract income tax from taxable income to get after-tax amount
Step 6: Calculate CPP contribution
Step 7: Determine EI premium
Step 8: Identify any required pension plan contributions
Step 9: Subtract CPP, EI and pension amounts from after-tax income
Step 10: The remainder is your take home pay in Yukon!
Let’s take a quick example for 2025:
| Description | Amount |
| Gross annual income | $70,000 |
| RRSP deduction claimed | $5,000 |
| Child care expenses deduction | $3,000 |
| Taxable income (Gross income – Deductions) | $62,000 |
| Marginal federal tax rate | 20.5% |
| Federal tax (Taxable income x federal rate) | $12,710 |
| Marginal Yukon tax rate | 9% |
| Yukon tax (Taxable income x Yukon rate) | $5,580 |
| Total tax (Federal tax + Yukon tax) | $18,290 |
| After-tax income (Taxable income – Total tax) | $43,710 |
| CPP contribution (5.95% of $68,500) | $4,082 |
| EI premium (1.66% of $63,200) | $1,049 |
| Take home pay (After-tax income – CPP – EI) | $38,579 |
So, based on the 2025 tax rates, the calculated take home pay in Yukon in this example is $38,579 annually, or $3,215 monthly.
How Life Changes Impact Take Home Pay in Yukon?
Your take home pay can fluctuate when there are major changes in your life situation, like:
- Marriage – Getting married may move you into a higher tax bracket, but allow access to pension splitting and spousal credits that can increase take home pay. Update your marital status with CRA.
- New child – Having a child makes you eligible for tax deductions like child care expenses and various child tax benefits. Adjust your TD1 allowances.
- Buying a home – Home ownership can open up tax credits like the home buyers’ amount and credits for property taxes paid. File a new TD1 with your employer.
- Starting a new job – Review your payroll deductions to ensure proper tax installments and benefit coverage based on your new income level and eligibility.
- Job loss – When unemployed, file your tax return ASAP to obtain tax refunds quicker. Apply for EI benefits.
- Reduced income – Look into tax credits like GST credit when income drops. Update your TD1 allowances to reduce tax installments.
- Return to school – File your taxes on time to receive tuition credits, which can reduce your tax bill as a student.
Learn how to estimate your potential net take home pay in different Canadian provinces based on your gross salary, tax brackets, and deductions.
- Take Home Pay in Alberta
- Take Home Pay in British Columbia
- Take Home Pay in Ontario
- Take Home Pay in Manitoba
- Take Home Pay in Quebec
- Take Home Pay in Nova Scotia
- Take Home Pay in Saskatchewan
- Take Home Pay in Prince Edward Island
- Take Home Pay in Newfoundland and Labrador
Strategies to Maximize Take Home Pay in Yukon
Here are nine tips to maximize net take home pay in Yukon:
- Contribute to an RRSP – Deductible RRSP contributions reduce your taxable income.
- Claim deductions/credits – Take advantage of any eligible deductions and credits you qualify for.
- Review benefit plans – Optimize coverage and premiums paid for health/dental plans.
- Check tax installments – File a new TD1 form whenever income or credits change substantially.
- Split pension income – Transferring assets to a lower-income spouse can minimize taxes.
- Contribute to a TFSA – Tax-free savings reduce taxes paid on investment income.
- Defer income – Delaying income to years when you are in a lower tax bracket can save tax.
- Plan for capital gains – Capital gains are taxed at a lower preferred rate compared to other income.
- Get a tax refund ASAP – File your return early to get any tax overpayments refunded quicker.
These tips can help you lower the amount of tax you pay and keep more of your income. Even small changes can make a big difference by the end of the year.
However, not all tips will work for everyone, so it’s a good idea to look at your own situation and see what fits. If you’re not sure what to do, talking to a tax expert can help. They can guide you on the best ways to increase your take-home pay and plan ahead for the future.
FAQs related to Take Home Pay in Yukon
What deductions reduce my take home income in Yukon?
Income tax, CPP, EI, pension contributions, union dues, benefits premiums, and wage garnishments can all reduce net take home pay.
Can I claim moving expenses if I relocated for work in Yukon?
Yes, moving expenses can be deducted if your new home is at least 40 kms closer to your new work location. Distance and other requirements must be met. Maintain receipts.
How are bonuses taxed in Yukon?
Bonuses and other similar lump-sum payments are added to your income for the year and taxed at your marginal tax rate. Tax installments, CPP and EI will be deducted.
How does getting married change my take home pay?
Marriage can change your tax bracket, and allow pension splitting and spousal credits that can increase take home pay. Update your marital status with CRA.
Can I claim child care expenses in Yukon?
Yes, child care costs for children under 16 are eligible for the child care expense deduction in Yukon. Limits based on number of children apply, so check with CRA.
When should I update my TD1 tax form?
File a new TD1 anytime your income, credits or deductions change substantially in order to update tax withholdings. This helps maximize take home income.
What taxes get deducted from commissions?
Commissions are taxed as regular employment income. Tax installments, CPP contributions and EI premiums will be deducted from commission payments.
How can I increase my take home pay in Yukon?
You can increase take home pay by claiming deductions like RRSP contributions, child care expenses, and employment costs, checking your tax installments are accurate, splitting income with a spouse, and tax planning strategies.