Glossary term
Net income for tax purposes
Net income for tax purposes is a Canadian tax amount used for many benefit, credit, and threshold calculations.
Plain meaning
What net income for tax purposes means
Net income for tax purposes is a tax-return concept. It is not the same as take-home pay and is not always the same as taxable income.
Formula role
How OpenBook uses it
Benefit and credit calculators may use net income for tax purposes when a rule is based on that measure. Tax bracket calculators often start from taxable income instead, because bracket tax is calculated after additional deductions have been reflected.
Common confusion
Benefit income measures differ
Some benefits use net income for tax purposes, adjusted family net income, income excluding certain items, or a program-specific income measure. OpenBook calculators state the measure being used where income definitions affect the result.
Primary references