Updates & History

A retirement plan faces more than one possible future. The experimental Retirement Resilience Explorer looks beyond a single year of pension splitting to explore household spending, savings, survivor affordability and an approximate after-tax estate. It starts with a simple three-step form for a couple in any Canadian province except Quebec; the prefilled numbers are examples, not recommendations.

2026 provincial tax reference: select a shared province of residence for both spouses, assumed unchanged throughout the projection. Quebec and the territories are not modeled. Federal and provincial calculations reflect 2026 rules with simplified assumptions, not a forecast of future law. Later budgets, brackets, credits and benefit changes require separate confirmation. Provincial benefit programs are excluded. The separate annual pension-splitting calculator remains Ontario-only.

Saving before retirement: optionally use different working-life spending while either living spouse is still working, and target a percentage of each person's employment pay to their own RRSP. Targets default to zero, are limited by entered room, age and available income after spending, and are not assumed better than TFSA saving. Current room and expected new annual room are entered explicitly rather than ignoring workplace pension adjustments. Remaining surplus uses TFSA room first, then non-registered accounts. The ledger reports contributions, unmet targets and modeled tax reductions. Spousal RRSP contributions, withdrawal attribution and actual refund timing are excluded.

• Build a household picture: enter essential and discretionary spending, each spouse's age and planned stop-work age, RRSP/RRIF, TFSA and non-registered balances, employment income, CPP/OAS estimates and workplace pensions. CPP/OAS start ages can be deferred through 70. Enter survivor CPP and pension totals explicitly rather than assuming two pensions simply add together.
• Challenge the plan: compare 12 named futures, including poor early market returns, the same returns in reverse order, earlier work cessation, higher inflation, unexpected expenses, care costs, long lives and earlier deaths. Work ends up to five years earlier, capped at the first projection year: someone aged 63 planning to stop at 65 tests stopping at 63, two years earlier.
• Compare transparent withdrawal policies: test non-registered-first against registered-first, with TFSA last in both. Mandatory registered withdrawals come first, eligible annual pension splitting is modeled, and surplus cash is reinvested. These rules are not a tax-optimal withdrawal recommendation.
• Focus on outcomes: see when desired or essential spending falls short, the survivor's largest essential-cost gap, and an estimated estate after additional final tax. One asset chart compares the normal plan with a selected stress; an optional annual cashflow table lets you check the numbers. Unfunded spending is reported as a gap, not silently borrowed.
• Keep your inputs locally, if you choose: calculations run in your browser, and inputs are not sent to our server. "Remember my inputs on this browser" is off by default; enabling it restores inputs on refresh or a later visit, but not results. "Forget saved inputs" removes the saved copy without changing the current form. Other people using the same browser profile may see saved inputs. Browser storage is not encrypted or a backup, and clearing site data removes it.

Stress tests, not predictions: the scenarios are illustrative and not equally likely. The number of tests with a spending gap is not a probability of failure. Earlier death can leave a larger estate because fewer years of spending were funded; that does not make it a better retirement outcome.

Clearer comparisons: enabled historical replay is selected automatically. Results identify the current experiment, historical/calendar alignment, retirement and benefit timing, investment mix and steady-assumption chart reference, with an expandable input snapshot. A text-and-colour spending status highlights gaps. The Plan fit score measures cumulative spending funded: essentials 60%, lifestyle 25%, survivor essentials 15%, with inapplicable goals excluded and weights normalized. The chosen mix and both reserve extremes are scored within the same future. Estate size earns no points; the score is not a probability, and first/worst gaps still matter even with a high score.

What could help? optionally compare one change at a time without replacing your plan: each eligible spouse works one additional year, defers CPP or OAS separately by one year (up to 70), or the household reduces discretionary spending by 10%. Compare spending coverage, bridge-year gaps, survivor shortfalls, tax trade-offs and estate changes within the same future and policy. Market shocks and historical replay keep their original projection-year mapping, even if retirement moves. Forced-job-loss futures do not offer working longer; already-started benefits and approved OAS are not deferred again. These experiments are not optimized recommendations. Enter assumed returns net of investment fees; no separate fee deduction is applied.

Optional OAS residence estimate: each spouse can keep the manual age-65 estimate, choose a simplified Canadian-resident calculation, or enter an already-approved pension. Residence mode compares the initially eligible partial pension with deferral, residence at approval, and applicable full-pension deferral. It does not stack the later residence fraction with the full deferral increase: 35 residence years at 65 and 40 at 70 generally gives 119% of full basic OAS, not 136%. Whole-year timing and ordinary residence rules apply; international agreements, complex residence and partial-OAS GIS are excluded. Already-approved pensions do not gain additional residence or deferral. See OAS Act section 7.1.

Optional GIS planning estimate: income-tested support can matter before assets run out. Opt in only if you assume full OAS eligibility, Canadian residence and no sponsorship restriction. The annual estimate uses current-year modeled income and October-December 2026 rates, with separate couple/survivor categories and smoothed benefit reductions. Registered withdrawals and taxable investment income may reduce GIS; TFSA withdrawals do not. Deferring OAS delays GIS. Actual payments normally use prior-year income and July reassessments; partial OAS, Allowance benefits, monthly timing and high-income terminal benefit recovery are excluded. GIS is included in income and shown separately in the ledger. Verify payments with Service Canada; rates come from official GIS tables.

Investment mix: optionally enter cash/GIC-like and bond percentages of existing balances, with equities as the remainder. Annual rebalancing maintains the percentages across accounts; these are not extra savings or a spending buffer used first in downturns. Cash interest, assumed bond income and foreign dividends are reinvested and taxed annually in non-registered accounts using simplified pooled cost basis. Income is included within total returns. GIC maturity restrictions, guarantees and foreign withholding credits are not modeled.

Optional historical replay: try a start year from 2000 through 2024, including 2000, 2008 and 2022. Replay starts at the first retirement by default, or at the first projection year if selected. This is a clearly labeled US/USD illustration: S&P 500 total returns, 10-year US Treasury returns, Treasury-bill rates and US CPI inflation, with no CAD conversion or ETF claims. Calendar and tax assumptions remain 2026 onward. Once recorded 2024 data ends, the ledger labels the return to your assumptions. Non-registered bond/dividend income uses your assumed yields, not recorded historical distributions. Sources: NYU Stern return data and World Bank US inflation.

Important prototype assumptions: values are in 2026 purchasing-power dollars. Future tax thresholds are hypothetically held constant in purchasing power, even where current rules do not index them. All accounts share an investment mix and return path; fees, Canadian dividend credits and capital-loss relief are excluded. The default 50% capital-gains inclusion is an explicit assumption, not a prediction of future law. Whole-year income and death timing, registered conversion by 71 and minimum withdrawals from 72 are simplified conventions; the RRSP-for-life proposal is not treated as enacted.

Survivor and estate estimates need care: first-death transfers assume qualifying spousal rollovers and a TFSA successor holder, requiring appropriate arrangements. A single survivor loses pension splitting and spouse credits. The last-death estimate includes remaining registered assets and included accrued gains, without a terminal-year pension-splitting election. Housing, debt, probate, estate administration costs, AMT and other refundable benefits are excluded. GIS is available only as an optional annual approximation. Changing retirement age does not recalculate CPP contribution history. This is not a complete financial plan or an estate tax return.

Official references

These sources explain the underlying rules, not the illustrative market paths or future-law assumptions:

• Service Canada CPP start ages and OAS start ages
• Service Canada CPP survivor pension and combined benefit limits
• CRA pension income splitting
• CRA receiving income from a RRIF
• CRA registered assets at death and capital property at death

The Retirement Resilience homepage is now the first navigation item. The annual Retirement Income Splitting calculator and historical calculators remain available. Use this explorer to identify questions and trade-offs, then verify decisions with current rules and qualified advice.

IncomeSplitting now looks beyond the historical Family Tax Cut. Our new Retirement Income Splitting calculator compares household tax with and without a pension-splitting election, and estimates how much of an additional RRSP or RRIF withdrawal you would keep. The first release supports 2026 Ontario resident couples. The original 2014/2015 calculators remain available for historical exploration.

• A household view: enter each spouse's employment income, qualifying workplace pension, RRSP/RRIF payments, CPP and OAS. The comparison includes federal and Ontario income tax, relevant credits, Ontario health premiums and OAS recovery.
• A suggested pension split: compare both possible election directions, up to 50% of one spouse's eligible pension income. Regular RRSP withdrawals, CPP and OAS are not eligible for this election. RRIF eligibility generally depends on the owner's age being 65 or older at year-end, not the receiving spouse's age.
• Deferred benefits welcome: enter zero for CPP or OAS you have not started receiving. CPP can start between 60 and 70, and OAS between 65 and 70; neither earns further deferral increases after 70. This annual comparison does not choose your start dates.
• Simple outcomes: see household cash after modeled tax and deductible outflows, estimated splitting savings, and the effect of the same additional withdrawal from an RRSP or RRIF, without reproducing tax-form worksheets.

Know the limits: this is an annual planning estimate, not tax filing software or a complete retirement plan. GIS, Allowance, GAINS and other refundable benefits are not modeled; extra withdrawals may reduce them. Investment income, capital gains, self-employment and specialized tax situations are outside this first release. Account balances, RRIF minimums, living expenses and future market returns are not simulated.

RRSP-for-life proposal: Budget 2026 proposes merging RRSP/RRIF features and eliminating mandatory conversion at 71, while retaining minimum withdrawals after 71. We have not treated that proposal as an enacted change to pension-splitting eligibility. The calculator keeps the applicable RRSP/RRIF distinction.

Official rules and sources

Our estimates use the published 2026 rates and amounts, with pension-splitting and credit-transfer rules checked against CRA worksheets. The 2026 annual return packages are not yet the verification source; the available 2025 worksheets supply their structure, with 2026 amounts checked separately. Sources reviewed November 12, 2026:

• CRA pension income splitting: eligibility, elections and effects on credits and benefits
• CRA Form T1032: Joint Election to Split Pension Income
• CRA 2026 payroll formulas: federal/Ontario rates, CPP and EI
• CRA 2026 federal personal tax credit amounts and 2026 Ontario personal tax credit amounts
• CRA unused credits transferred from a spouse or common-law partner
• Service Canada OAS recovery thresholds
• Service Canada CPP start ages and OAS start ages
• Ontario low-income workers tax credit (LIFT)
• Budget 2026 tax proposals, including RRSP for life

We tested independently calculated examples, pension eligibility, payroll and benefit thresholds, and desktop/mobile layouts. Calculations stay in your browser. For decisions affecting an actual return or retirement income, check current tax software or consult a qualified professional.

After years without updates, IncomeSplitting has a fresh look and more accurate historical calculations. You can revisit how the Family Tax Cut worked and compare different family income situations. The benefit ended for 2016 and later years: this update does not bring it back or calculate today's taxes.

• Easier to use: clearer income sliders, improved phone and tablet layouts, and calculation details you can open when you want to see how a result was reached.
• Corrected estimates: we fixed errors and oversimplified assumptions in our older calculator, including the $50,000 limit on income used in the comparison and the treatment of spouse, caregiver and transferred credits. Some results will therefore differ from earlier versions.
• A quick estimate or a closer look: use the simple income estimate, or enter figures from completed 2015 returns for a more precise calculation. You can choose which spouse claims the credit and see the difference between the credit amount and actual estimated tax savings, including for Quebec families.
• Less form-filling: eligibility conditions are assumed met by default. Expand the eligibility section if you want to review or change those assumptions.
• Refreshed comparisons: the What If calculator uses corrected 2015 tax rates and improved suggested transfers. The summary tables have been recalculated using 2014 rules, with their assumptions explained alongside the results.

The official calculation also changed historically. CRA explained that a 2015 change addressed how unused tuition, education and textbook credits transferred between spouses affected the Family Tax Cut. It said some affected families could receive between $2 and $750 more, and that it would automatically reassess eligible 2014 returns where the increased entitlement was apparent. Our updated calculator includes that revised treatment. This official rule change is separate from the errors we corrected in our own calculator.

Many improvements were made with AI assistance. We checked the revised calculations against historical CRA forms and worked examples, and tested the site on desktop and mobile.

This remains a historical exploration tool, not tax preparation software or professional advice. The provincial What If comparisons are hypothetical and omit some credits, taxes and benefits. For an actual return, use an official filing tool or consult a tax professional.

And now it's officially dead. From CRA site (What's new for 2016): The family tax cut has been eliminated for 2016 and later years.

After all Family Tax Cut is not dead yet, so this week I updated all the tax rates and forms for the year 2015. Enjoy the cut while it lasts.

BTW, comments functionality was moved to the Facebook page to make housekeeping easier on this site.

It seems income splitting is over. Canada chose a new prime minister – Justin Trudeau (try to spell his name). Why Trudeau is beyond me. I looked again at his promises and nothing really stands out. My theory is that the choice is mainly irrational, change for the sake of change. “Better is always possible”. We are all kids deep inside and believe in miracles. It’s naive but understandable. The problem though is exacerbated by our broken election system where small differences in popular vote are disproportionately amplified and 40% of votes become 55% seats in the House of Commons. And each party promises electoral reform (including Liberals by the way) until they start benefiting from the broken system and forget about their promises.

I need to admit that hatred towards Steven Harper was professionally orchestrated and was very efficient. Now when he is leaving the office, his bashing gets even stronger. And it is sad. Steven Harper is a man of integrity, which is rare and not particularly popular among politicians. He has courage to name white as white and black as black. He is a man of his word. He did what he thought was right for Canada. Yes, for many of us life is getting tougher over years, there is not much progress for the middle class over last 20-30 years. But that is an unfortunate global trend which is very hard to change. Even Mr. Harper opponents have to admit that Canadian economy withstood the global crisis better than many other G7 countries. I’d like personally to thank Mr. Harper for his service and I think 30% of Canadians who voted for him in the last election would join me as well.

So why not Trudeau? Well, he is a son of Pierre Trudeau and I don’t want three Bushes here in Canada. He is from Quebec, the province that always thinks about separation. And did he ever work in his life outside of politics? Wikipedia is somewhat shallow on that aspect. Does he have any record of real achievements? Prime Minister job may be a bit too high to start your work experience. Is he ready? Well, let’s hope he is and “better is still possible”. And yeah – nice hair.

The tax year is almost over and I started to prepare my taxes. I’ve been using TurboTax for many years – not necessarily the best choice, but I got used to it and am too lazy to switch. I don’t particularly like the process and every year procrastinate till the very end. It’s usually midnight local time on the last day when I press the Send button. This year we are lucky and got five extra days. I decided not to wait till the very end and started with the process on May 1st (yeah, I know). I went through all of the Easy Steps screens and came to the Review screen. I paused there and decided to have my moment of joy looking at the family tax cut. I opened Schedule 1A and – oops – the number is far lower than I expected. I started to panic. I looked at the online calculator and it clearly showed me that my rebate is a full $2000. Does it mean I was lying to all the people visiting this site? I took a deep breath and started to compare forms in TurboTax and online line by line. Soon enough I came to the line 498 of the Schedule 1A which showed in TurboTax a full basic amount of 11,138. That was weird. The comment to that line said that it’s coming from the line 303 of the Schedule 1. I checked it and sure enough it had 11,138 too. The comment in line 303 refers to Schedule 5, which is Amounts for Spouse and Dependants. No idea what that amount is. So I opened the tax guide from the CRA site and checked their explanation as to what line 303 and Schedule 5 are. You can claim an Amount for your Spouse only if she earns less than the basic amount, which definitely was not my case. That was puzzling. I called the TurboTax Help line and talked to their support guy and then to the certified accountant. I deal with support myself and I know how hard it is to troubleshoot a complex program when you don’t even see the screen where the problem occurs, in front of you, let alone having the logs from the program. They did agree that the Amounts for Spouse were wrong in my case but we could not find anything in my data that could cause that. It seemed completely bizarre. Running out of ideas we decided to go through the review step of the TurboTax interview and – eureka – it complained about an error in the report and suggested an automatic fix. Yes, please fix it, and it did. Suddenly Schedule 5 was gone and line 303/line 498 reset to empty values as expected. The tax cut went up to $2000! Horray! But wait a second, what happened to the refund? My refund suddenly dropped the whole one thousand dollars – oops … Oh well, at least the online calculator is correct and stands strong. True story.

It was freezing cold this Family Day weekend. A good excuse to skip skiing and skating and finish this project update. Joggling between my son’s swimming competitions and this project I managed finally to finish version 2 of the calculator.

This calculator version is more focused as there are tax forms available from the CRA website (Schedule 1a). I dropped all provincial taxes, graphs and variations in the transferred amount and just followed the prescribed process. The tax forms featured as a part of the calculator closely resemble the official forms.

There are still some issues with the mobile (although landscape mode looks better) and the overall page size became larger, but alas you cannot have it all.

Hopefully this update will be useful to some of you before April 30th comes.

I am not an accountant. Mind you. Not even close. Every time I open that brown envelope from the CRA I do not expect any good news. Quite the opposite. However, this year the tax news announced by the Conservatives were quite exciting. Income splitting definitely applies to my family and I am more than happy to see how at least some fairness returns to the Canadian tax system. I do understand that the timing is not completely random and upcoming federal elections are a big factor. Whatever. My family will still benefit from the change.

Right after the announcement there were many discussions and the most vocal opinion was that rich benefit once again. Wait! If family incomes are $10K and $70K and the family pays roughly $10,600 federal tax, while another family with the same total income (say $40K and $40K) pays roughly 8,600 federal tax, what exactly is fair in such an arrangement? Who exactly is rich here? This is puzzling to say the least.

To see the actual numbers coming from the proposed income splitting, I started to google for an online calculator. I did not find one and decided to make my own. And this page is the result.

The current proposal is definitely not a real income splitting system – with all kinds of constraints it is better than nothing, but still far from fair. Just check the table with the 50/50 split scenario for your case. And provincial taxes are not even mentioned yet.

I called the CRA in an attempt to get some clarifications on the matter, but obviously until all official tax forms are ready there is no information on any details. It means the whole calculation may be totally off, if there are some nuances, that I interpreted incorrectly. Sorry about that, but this is my best shot given the current lack of detailed information. Still, I hope this calculator is at least somewhat useful.

If you find any issues with this calculator or have any idea how it may be improved, please drop a word in the comments section. If you have any questions about any of the tables/results please ask. And if you completely disagree with the whole idea of income splitting you are welcome too, though I obviously have a different opinion!