Presentation: Tax credits for seniors

To make it easier for you to prepare materials for clients, we’ve developed these slide selections on how to use tax credits during retirement. The presentation is in a Word file to make it simpler to customize content for your client’s needs.

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8 ways to minimize taxes during retirement

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The financial perks of being a senior extend beyond occasional 10% discounts — there are also tax credits available for reducing your burden when settling annually with CRA.

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Strategy #1: Fill out line 301 – age amount

If you were 65 or older as of December 31, 2014* and if you earned less than $80,980, then you’re likely eligible for this credit.

If your net income was $34,873 or less, you would have qualified for a $6,916 credit, but if you earned between $34,873 and $80,980 you have to calculate your claim using CRA’s federal worksheet, which is also used for other credits.

*Note, these numbers are for the 2014 tax year and you can expect them to be updated for 2015.

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Strategy #2: Claim the pension income amount

You can claim up to $2,000 if you report eligible pension, superannuation, or annuity payments on your return.

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Strategy #3: Take advantage of pension income splitting

You may be eligible to split up to 50% of eligible pension income with your spouse or common-law partner.

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Strategy #4: Claim RRSP deductions

Deductible RRSP contributions can reduce your tax bill. You have until December 31 of the year in which you turn 71 to contribute to your RRSP.

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Strategy #5: Claim disability amounts

If physical or mental functions are severely impaired over the long term, and you meet certain conditions, you may be eligible to claim the disability amount.

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Strategy #6: Claim eligible medical expenses

Medical expenses almost always increase with age. So keep track of your expenses each year and claim any that are eligible for yourself, your spouse or common-law partner.

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Strategy #7: Claim transit expenses

If you don’t drive, you may have purchased either weekly or monthly transit passes throughout the year. In most jurisdictions, you can claim these on your tax return.

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Strategy #8: Don’t forget about the OAS Recovery Tax

The OAS Recovery Tax, part of the Income Tax Act, requires all higher-income pensioners to repay their OAS pensions.

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Extra tip!

Don’t forget to check out provincial credits that may apply to you based on where you live.