If you earned money from a summer job this year, you may be wondering if you owe income tax. Here is the short answer: if you earned less than $16,129 in 2026, you owe zero federal income tax. That number is called the basic personal amount, and it applies to every Canadian. Your provincial government has its own version too. In Ontario, the provincial basic personal amount is approximately $11,865 for 2026. Earn under both thresholds, and your income tax bill is zero.
That is the number most students need to know. Now here is why it works that way, what still comes off your paycheque, and why you should file a tax return anyway.
What the Basic Personal Amount Actually Is
The federal government lets every Canadian earn up to a set amount each year before paying any federal income tax. In 2026, that number is $16,129. Think of it as a floor. Income below it is tax-free at the federal level.
Each province adds its own basic personal amount on top. Ontario's is around $11,865. Because both thresholds apply separately, a student earning $9,000 from a summer job pays zero federal tax and zero Ontario tax.
The math is simple. Your income minus the basic personal amount equals the amount actually taxed. If the result is zero or below zero, there is no income tax.
A Worked Example: $9,000 Summer Job
Say you work at a camp for the summer and bring home $9,000.
Federal basic personal amount: $16,129. Your income: $9,000. Taxable amount: zero. Federal income tax owing: zero.
Ontario basic personal amount: $11,865. Your income: $9,000. Taxable amount: zero. Ontario income tax owing: zero.
So far, so good. No income tax. Keep reading, though, because something else still comes off.
CPP and EI Still Come Off Your Paycheque
Canada Pension Plan contributions and Employment Insurance premiums are deducted separately from income tax. There is no basic personal amount protecting you from them.
CPP is calculated at 5.95% on earnings above $3,500, up to an annual maximum. On $9,000 of summer income, roughly $327 goes toward CPP. EI premiums run at approximately 1.64% of your insurable earnings, which on $9,000 works out to about $148.
That is around $475 in CPP and EI deductions on a $9,000 income, even though your income tax bill is zero.
CPP contributions build your future retirement entitlement. Every year you contribute, you earn a little more future retirement income. EI premiums build your eligibility for Employment Insurance if you ever lose a job later in life. Both matter down the road, even if they sting a little today.
Why Your Employer Might Still Withhold Income Tax
Your employer withholds based on projections. If they annualize your summer earnings as if you work year-round, they might deduct income tax from your paycheque even when you will not actually owe any by year-end.
This happens more than you'd think. It is one of the reasons your first paycheque looks smaller than you expected, and it is exactly why filing a return matters.
File a Return. Even If You Think You Owe Nothing.
A lot of students skip filing because they figure they earned below the threshold and there is nothing to report. That is a mistake, and it costs them real money. We cover whether teens need to file taxes at all in its own article; the short answer is that filing is almost always worth it.
Here is what you get when you file:
Any income tax your employer withheld during the year comes back to you. If your employer deducted $300 in federal tax from your summer paycheques and you owe zero, you get that $300 back as a refund. It is your money sitting at CRA until you go get it.
On top of that, filing a return for 2026 creates RRSP contribution room. Every dollar you earn generates 18 cents of RRSP room. On a $9,000 income, that is $1,620 of room to shelter future earnings from tax when you are older and earning more. RRSP room carries forward indefinitely, but it only starts accumulating when you file.
If you are 18 or older, filing also triggers the GST/HST credit. It pays out quarterly based on your reported income. Students with low incomes often qualify. You need to file to see it.
The process is simple. Your employer will send you a T4 slip in February or March showing your total earnings and any deductions. Free software like Wealthsimple Tax walks you through the whole return in under an hour. The filing deadline is April 30 of the following year.
One Concrete Next Step
Write this in your phone right now: April 30, 2027.
When your T4 arrives next spring, open a free tax software account and file. It takes less time than you think, and there is a real chance money comes back to you.
A refund sitting at CRA because you didn't file is still your money. Stewarding what you've earned starts with knowing what is yours and going to get it.