Get a head start on tax season with these five tips from Patricia Lovett-Reid, Senior Vice- President, TD Waterhouse on helping seniors maximize their taxes and save money.
Share your CPP Benefits
Spouses or common-law partners who live together and who are both at least 60 years of age may also share CPP benefits. Sharing CPP benefits is a way to decrease the household’s overall taxes by reducing the income of the higher income earner and generate income for the lower income spouse or common-law partner.
Split your Pension Income
Canadian residents have the opportunity to lower the overall taxes for their household by splitting 50 per cent of their pension income with their spouse or common-law partner (if they are a Canadian resident).
Take Advantage of Tax Credits
Investigate the tax credits you are now eligible for, such as the pension income credit and the GST/HST credit. If you are 65 or over, you’re also eligible to claim an age amount credit. If you are unable to make full use of them, you can transfer your unused credits to a spouse or common-law partner.
Contribute to your RRSP
If you have unused RRSP contribution room, you can reduce your taxable income by making contributions to your own RRSP or to a spousal RRSP, as long as the annuitant of the RRSP is under the age of 71 when the contribution was made.
File Individual Income Tax Returns
Seniors should file annual tax returns even if earnings do not result in any tax payable. By doing so, you can establish contribution room for a Tax-Free Savings Account and ensure that recipients of the Guaranteed Income Supplement (GIS) continue to collect their benefits.
For more information, please visit www.tdretirement.com.