Family Income
Definition
Median after-tax income of economic families (total population, people in poverty).
An ‘economic family’ is defined by Statistics Canada as a group of two or more persons who live in the same dwelling and are related to each other by blood, marriage, common-law union, adoption or a foster relationship.
After-tax family income represents total family income less all federal and provincial income taxes. Median income refers to the amount of income that divides a population into two equally-sized groups, half with an income above the median, and half with an income below the median.
Measurement and Limitations
Median after-tax income is presented for individuals age 15 years and over living in private households. It is based on total individual income less all federal and provincial income taxes.
Although similar, median income is a more accurate summary measure than average income because it is not affected by a few high or low incomes that can pull the average in one direction or another.
Total income refers to income of a regular and recurring nature such as:
- employment income from wages, salaries, tips, commissions and net income from self-employment (for both unincorporated farm and non-farm activities)
- income from investment sources, such as dividends and interest on bonds, accounts, guaranteed investment certificates (GICs) and mutual funds
- income from employer and personal pension sources, such as private pensions and payments from annuities and registered retirement income funds (RRIFs)
- other regular cash income, such as child support payments received, spousal support payments (alimony) received and scholarships
- income from government sources, such as social assistance, child benefits, Employment Insurance benefits, Old Age Security benefits, COVID-19 benefits and Canada Pension Plan and Québec Pension Plan benefits and disability income.
Types of income that are not included are:
- one-time receipts, such as lottery winnings, gambling winnings, cash inheritances, lump-sum insurance settlements and tax-free savings account (TFSA) or registered retirement savings plan (RRSP) withdrawals
- capital gains because they are not by their nature regular and recurring. It is further assumed that they are more relevant to the concept of wealth than the concept of income
- employers’ contributions to registered pension plans, Canada Pension Plan, Québec Pension Plan and Employment Insurance
- voluntary inter-household transfers, imputed rent, goods and services produced for barter and goods produced for own consumption.
The advantage of using after-tax income instead of before-tax income is that it indicates the financial situation of families after income taxes and deductions are taken into account; the limitation is that it does not reveal as clearly differences in market income.
Source
Customized Census data, “Semi-Custom profile from the 2016 and 2021 Census for Custom Geographies” acquired through the Canadian Community Economic Development Network’s Community Data Program.
Family Income in the Sustainable Development Goals
Click on the SDG to reveal more information
1. End poverty in all its forms everywhere
Extreme poverty rates have been cut by more than half since 1990. While this is a remarkable achievement, one in five people in developing regions still live on less than $1.90 a day, and there are millions more who make little more than this daily amount, plus many people risk slipping back into poverty.
Poverty is more than the lack of income and resources to ensure a sustainable livelihood. Its manifestations include hunger and malnutrition, limited access to education and other basic services, social discrimination and exclusion as well as the lack of participation in decision-making. Economic growth must be inclusive to provide sustainable jobs and promote equality.