Comments on: Pension Income Splitting For Canadians

By: Tax Guy

Tax Guy — Tue, 24 Jan 2012 11:43:41 +0000

That’s the million dollar question. you’ll need to compare the cash flows and consider the opportunity cost of taking it early or deferring it to any age between 61 and 70.

By: ray b

ray b — Tue, 24 Jan 2012 03:51:37 +0000

I just turned 60 this past week and currently paid approximately $600 per month from a bridge until age 65. Would I be better to take the CPP at age 60 or wait and take the CPP at 65.

Regards Ray B

By: Tax Guy

Tax Guy — Mon, 23 Jan 2012 16:32:04 +0000

If you call Service canada they will split the CPP credits.

By: Sans Culottes

Sans Culottes — Mon, 23 Jan 2012 16:19:20 +0000

Fool that I was, when I first heard about this I thought it applied to CPP and OAS (the only pension income my much-older spouse gets, and who knows if we’ll even have those benefits by the time I’M older). Guess what, sucker, you lose again. No provision for those who’ve never been fortunate enough to qualify for extras like a company pension, uh-uh…I should have stayed at my first job back in the ’80s. They indtroduced an employee plan just about the time I left after working there five years. Since then, I have never worked for a company that had such a plan.

By: Best of Blogs – Have you bought your RRSPs yet? | Retire Happy Blog

Best of Blogs – Have you bought your RRSPs yet? | Retire Happy Blog — Fri, 18 Feb 2011 06:51:57 +0000

[...] Resource has a great article on Pension Income Splitting with very practical [...]

By: Nicholas Miazek

Nicholas Miazek — Mon, 14 Feb 2011 21:30:57 +0000

Geoff,

RE: “The challenge is that I started roughing mone out on Turbo Tax which asked me to include data from her 2010 return.”

Assuming you and your wife are both over 65 so your withdrawals qualify for the election to split income on form T1032. Enter your tax info then your wife’s, Turbotax should only then calculate (or re-calculate) your optimal split (the transfered amount from the higher income spouse to the lower income spouse) that you will elect on filing your returns. The amount should not be calculated before all other credits and deductions for both of you are factored in.

By: Tax Guy

Tax Guy — Mon, 14 Feb 2011 21:04:33 +0000

Geoff,

I’m not sure I understand what you mean by “slit off” some of your income but you can’t allocate any income to your spouse unless you are 65 or older and the income is eligible pension income.

Otherwise the RRSP withdrawals are must be claimed by the annuitant of the plan.

If this is a spousal plan that one spouse has contributed to and the other is withdrawing, you need to make sure you understand that the attribution rules apply back to contributions made in the current and prior two tax years.

By: Geoff

Geoff — Mon, 14 Feb 2011 19:25:02 +0000

My wife and I both received income from RPPs in 2010 and want to slit off some of my income. My question relates to sequencing of the return preparation. Do I do mine first and then hers or vice versa. The challenge is that I started roughing mone out on Turbo Tax which asked me to include data from her 2010 return.

Geoff

By: Best of Blogs – The end of an era | Retire Happy Blog

Best of Blogs – The end of an era | Retire Happy Blog — Sun, 23 Jan 2011 06:13:02 +0000

[...] Tax Resource primes us on Pension Splitting [...]

By: Tax Guy

Tax Guy — Mon, 10 Jan 2011 14:18:49 +0000

@Steve Z.,
You can contribute to your own RRSP and take the deduction or you can contribute to your spouses RRSP (spousal RRSP) and tax the deduction.

If you contribute to the spousal RRSP and your spouse withdraws from the plan in the current or prior to years, then the withdrawals will be tax in your hands up to the amount of your contributions.