Pension income splitting

    Your household

    Higher-income spouse

    Registered pension plan income at any age; RRIF/annuity income from 65. CPP and OAS are not eligible.

    Lower-income spouse

    Counts toward this spouse's own pension income amount.
    Lowest-tax split
    50%
    $30,000 allocated
    Estimated saving
    $5,716
    combined tax + recovery tax, per year
    Combined tax after split
    $10,055
    vs $15,771 with no split

    Combined tax at each split

    0% split$15,771
    10% split$13,820
    20% split$12,020
    30% split$11,175
    40% split$10,539
    50% split$10,055
    No splitBest (50%)Maximum (50%)
    Higher-income spouse's tax$15,771$6,163$6,163
    Lower-income spouse's tax$0$3,893$3,893
    OAS recovery tax$0$0$0
    Combined$15,771$10,055$10,055

    Up to 50% of eligible pension income can be allocated to a spouse or common-law partner each year by filing Form T1032 with both returns. Tax uses 2026 brackets with the basic personal, age (65+) and pension income amounts for each spouse — so moving income can also let the lower-income spouse claim the pension credit — plus provincial extras such as the Ontario Health Premium and Quebec's family-income rules. Other credits aren't included. Splitting also moves income tax withholding — check with the CRA.

    Pension income splitting · Powered by RetirementPlanner.ca · MITEY. Educational estimates, not financial advice.