Comparing a CAD Offer to a USD Offer, Properly

~7 min read·Updated August 2026

Calculator:Offer & Relocation Comparator — run your own two offers.

Short answer: don't compare gross salaries. A $180,000 CAD offer and a $230,000 USD offer aren't 1.28x apart just because the numbers say so — by the time payroll tax, your actual income-tax rate, the exchange rate, and cost of living are accounted for, the real gap is usually much smaller than the headline numbers suggest, and sometimes it flips entirely.

Why the raw numbers mislead you

Four things separate a gross salary from what it's actually worth to you, and a straight salary comparison skips all four:

Payroll tax. CPP and EI come off a Canadian paycheque before you see it; Social Security and Medicare come off a US one. These aren't optional and aren't the same rate.
Income tax. Federal plus provincial (Canada) or federal plus state (US) — and these genuinely differ by jurisdiction. Ontario and California are nothing alike; Alberta and Washington are nothing alike either, in the opposite direction.
The exchange rate. A CAD salary and a USD salary aren't directly comparable numbers until one is converted into the other.
Cost of living. $230,000 in Austin and $230,000 in the Bay Area buy very different lives. None of the first three points matter if you don't also adjust for this.

What's computed for you, and what isn't

CPP/EI and Social Security/Medicare are federal-only, single-formula programs — the same rate applies no matter which province or state you're in. That makes them cheap to compute exactly, so this calculator does: real 2026 CPP, CPP2, EI, Social Security, and Medicare math, not an estimate.

Provincial and state income tax are a different problem — genuinely different brackets in 13 Canadian jurisdictions and 50 US states, several of which (Alberta has a flat provincial rate; Washington, Texas, Florida, and others have no state income tax at all) don't even follow the "graduated brackets" shape the others do. Modeling all 63 correctly is its own project. Instead, you enter your own combined marginal rate for each side — the same approach the Departure Tax Estimator already uses for Canadian tax.

Worked example

A $130,000 CAD offer (Ontario) vs. a $170,000 USD offer (Washington, no state income tax), at a 1 CAD = 0.73 USD exchange rate and a 15% cost-of-living premium for the US city.

Canadian offer: $130,000 gross, minus $5,770 in CPP/CPP2/EI, minus 43% combined income tax on the rest = $70,811 net CAD ≈ $51,692 USD at the stated exchange rate.

US offer: $170,000 gross, minus $13,005 in FICA/Medicare, minus 24% federal income tax (Washington has none) = $119,316 net USD. Adjusted for the US city costing 15% more to live in, that's $103,753 in comparable terms — the US offer is ahead by about $52,061/year, a lot closer than "$170k vs $130k" made it look, but still a real advantage.

The breakeven number is the useful one

Rather than just "offer A is worth $X more," the calculator also solves for the USD salary that would exactly match the Canadian offer, holding your entered US tax rate and cost-of-living adjustment fixed. In the example above, that number is $84,698 — meaning the US offer could drop by more than half and still match the Canadian one. If the Canadian offer is ahead instead, the same number reads as a target: "the US side would need to offer at least this much." Either way, it's a single number worth anchoring a negotiation to.

Common mistakes

⚠️Comparing gross salaries directly

The single most common mistake — and the one that makes US offers look more dramatically better (or worse) than they actually are. Payroll tax alone typically eats 6-10% more off a US paycheque than a Canadian one at income levels above the CPP/EI ceilings, before income tax is even considered.

ℹ️Picking a marginal rate that's actually your average rate

Marginal rate — the rate on your next dollar — is usually noticeably higher than your average (effective) rate on total income. Using your average rate here understates how much tax actually applies to the income difference between two offers.

ℹ️Ignoring cost of living because "the salary is so much higher"

A bigger number in a more expensive city can easily be a real pay cut. Get an actual cost-of-living comparison for your specific city pair rather than guessing — the adjustment moves the final number more than most people expect.

📋Forgetting employer retirement matching

A 401(k) or RRSP match is real compensation this calculator doesn't include — it compares take-home cash only. If one offer has a materially better match, factor that in separately.

Run your own two offers through the Offer & Relocation Comparator to see the real gap in dollar terms, or check the CoastFIRE Calculator to see how either offer changes your retirement timeline.