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Ontario corporate tax calculator 2026
Estimate federal and Ontario tax for a Canadian-controlled private corporation with active business income in 2026. The tool applies the small business rate up to the business limit, the general rate above it, and Ontario’s July 1, 2026 rate change by days in your fiscal year.
An illustration of corporate income split between the small business rate and the general rate, not your result.
Visual labels: Up to the limit; Above the limit; July 1 rate change.Your scenario
Amounts are displayed in CAD for a Canadian-controlled private corporation in Ontario with active business income.
- Federal tax
- $27,000.00
- Ontario tax
- $8,087.67
- Income at the small business rate
- $300,000.00
- Income at the general rate
- $0.00
- Ontario small business rate for this year
- 2.70%
- Days at 3.2% / 2.2%
- 181 / 184 of 365
- Effective rate
- 11.70%
- Combined rate on the next dollar
- 11.70%
- Left after corporate tax
- $264,912.33
Ontario’s lower rate fell from 3.2% to 2.2% on July 1, 2026, so a fiscal year that spans that date uses a blend of the two, weighted by days.
Calculated on this device. These inputs are not submitted to Sora.
How the calculation works
Tax = income up to the business limit × (federal 9% + Ontario lower rate) + income above it × (federal 15% + Ontario 11.5%). Ontario’s lower rate was 3.2% until June 30, 2026 and is 2.2% from July 1, 2026. When a rate changes during the year, the CRA bases the calculation on the number of days in the year at each rate, so the Ontario lower rate = (3.2% × days before July 1 + 2.2% × days from July 1) ÷ days in the fiscal year. The business limit is $500,000 unless you enter a smaller one.
A worked example
At an illustrative $300,000 of taxable income and a January 1 to December 31, 2026 year, 181 days fall before the change and 184 after, so Ontario’s lower rate is about 2.70%. Federal tax is $27,000.00 and Ontario tax is $8,087.67, for $35,087.67, an effective rate of about 11.70%. A fiscal year that ends June 30, 2026 uses 3.2% throughout and a year that starts on or after July 1, 2026 uses 2.2% throughout.
Assumptions and limits
This is an estimate of Part I tax for a CCPC that qualifies for the small business deduction, not a T2 return. The business limit is shared among associated corporations and can be reduced in some situations, so enter a reduced limit if yours is lower. Short tax years, investment income, manufacturing and other credits, loss carryovers, the Ontario Corporate Minimum Tax and instalments are not included. Taxable income is not the same as accounting profit; capital cost allowance and other adjustments come first. Ask your accountant to confirm the limit and the rates for your year.
General educational information. Inputs stay on this device and are not submitted. Confirm the assumptions before using a result in a business decision.
Source and further reading
2026 rates checked October 24, 2026 against the CRA page: CRA: corporation tax rates, federal and provincial. The examples above use Sora’s own illustrative figures.
Ontario small business rate cut, July 2026
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