Pension Income Splitting Calculator
See how splitting eligible pension income with your spouse reduces your combined tax bill and OAS clawback. Works for RRIF, company pension, and annuity income across all Canadian provinces.
Income Details
Subset of higher earner income
Amount split: $15,000
Before vs After Splitting
| Item | Before | After |
|---|---|---|
| Higher Earner Taxable Income | $100,000 | $85,000 |
| Lower Earner Taxable Income | $30,000 | $45,000 |
| Higher Earner Tax | $20,677 | $16,230 |
| Lower Earner Tax | $2,756 | $5,613 |
| Combined Tax | $23,433 | $21,843 |
Optimal Split
Best split ratio for your numbers
50% ($15,000)
Total savings at this ratio: $2,592
✓ You are at (or near) the optimal split.
Tax Savings at 50% Split
Why the extra credit? After splitting, both you and your spouse have eligible pension income, so both can claim the federal pension income amount (15% × up to $2,000 = up to $300 each). Before splitting, only the higher earner qualified.
OAS Clawback Impact
OAS clawback threshold (2026): $95,323
How Pension Income Splitting Works
Eligible Income Types
- RRIF withdrawals (age 65+)
- Registered pension plan (RPP) income — company/employer pension
- Life annuity payments from an RPP
- Annuity payments from an RRSP or DPSP (age 65+)
- Foreign pension income (some exceptions apply)
Key Rules
- Maximum split is 50% of eligible pension income
- Both spouses (or common-law partners) must file a joint election using CRA Form T1032
- Age 65+ is required for most types (RRIF, RRSP annuity); RPP payments are eligible at any age
- The higher earner reports the full pension income earned, then deducts the split amount; the lower earner reports the split amount as income
- Both spouses must file a Canadian tax return for the same year
OAS Clawback Benefit
Reducing the higher earner's net income through pension splitting can lower or eliminate OAS Recovery Tax (clawback), which applies at 15% on income above the threshold ($95,323 in 2026).
Planning your full retirement income picture?
See your full retirement income — CPP, OAS, RRIF & TFSA →Disclaimer: Pension income splitting requires filing CRA Form T1032 with your annual tax return. Tax savings shown are estimates based on federal and provincial income tax brackets and do not account for all credits, deductions, or individual circumstances. OAS clawback estimates are based on net income approximation only. This calculator is for illustrative purposes — consult a qualified tax professional or financial advisor before making pension splitting decisions.
Related retirement tools
Related Calculators
- Income Tax Calculator — Federal and provincial tax by province
- RRIF Minimum Withdrawal Calculator — Required withdrawals by age
- CPP & OAS Start Age Calculator — When to start collecting
- Take-Home Pay Calculator — Net pay after all deductions