Help with pensions appreciated.
 

Hello everyone, I have just come across this heaven sent site and I can see I will have many informative hours browsing through the wealth of info :).

My daughter in Georgtown , Ontario has sent in the sponsorship forms in April this year for me to join her sometime hopefully in the next 3 years or so:thumbsup: However I would appreciate some info on how the Canadian taxation system will affect my meagre pensions.

I will be getting approx £8500 per annum from my private pension company and £4900 from the Government Pension (which I do know will not increase when I move:mad:). I should also have about £2000 from interest on my ISA and another £1900 interest from other savings, so say £17,000 in all per annum. I have gleaned that I can get a form so that I do not pay any income tax on this at the British end but can anyone help me with how much tax will be taken off at the Canadian end.

The tax free personal allowance will be £6000 this year in Britain. How much is it currently in Canada?

I am excited at the prospect of joining my daughter and little grandaughter in the near future but am worried how much income I will have to live on as I don't expect to be working in Canada.

Thank you for any advice on this complex subject (I did go onto the Canadian Taxation website but their 55 page document left me giving up the will to live:confused:)

Re: Help with pensions appreciated.
 

Firstly, hi and welcome!

I'm afraid I don't have any experience of pensions in Canada and so can't answer your questions but have you checked the Wiki (on blue bar at top of page)?? There is an article in there about pretty much everything, I bet there's one about pensions!! Just do a search for it.

Or alternatively, do a search of the forums (top right), it's bound to have been discussed before!

Hope that helps. :)

Re: Help with pensions appreciated.
 

Hi


This is a really rough estimate, Income $34,000/year. Deductions
Personal, 9600, age 5177, pension income (may/not get full deduction)2000, Taxable income $17,223. Federal tax payable 2500, Provincial 1000 total 3500. If you wanted you could download the tax forms from Revenue Canada and see what the bottom line would be.

Re: Help with pensions appreciated.
 

if your daughter is sponsoring you...ride the gravy train Grandma :rofl: you spent enough raising her, it's her turn now haha.

I of course jest, but good luck with your application. the wiki IS a great source of information.

Re: Help with pensions appreciated.
 

You didn't put your age in your profile. ;) It makes a difference.

Your income will be about $34,600 a year. If you are under 65, in Ontario the total income tax (Federal and Provincial) will be $5,618 in 2008. However, if you are over 65 you will get additional tax credits that will reduce the tax to $4,302.

In Canada there are personal tax credits rather than a personal allowance. The amounts are different for Federal and Provincial taxes.

All income is taxable, but you deduct basic rate tax that would otherwise be payable on the tax credit amounts.

At the Federal level everyone gets a tax credit of $9,600 a year. A person over 65 will get an additional tax credit of $5,276 if they earn below $31,524 a year. This reduces as income rises and is eliminated when income exceeds $66,697 a year. In addition, a person over 65 receiving pension income gets an additional tax credit of $2,000.

The equivalent provincial amounts in Ontario are $8,681, $4,176 and $1,201.

Someone under 65 will only be entitled to the $9,600 ($8,681) personal tax credit.

Re: Help with pensions appreciated.
 

Thank you JohnboyE for explaining matters.

I will be probably about 62ish when I get the letter to go so I reckon I will be about £110 worse off per month in Canada due to my at present tax free ISA interest going to be taxed in Canada . However I am looking on the bright side that after I turn 65 the £110 should be just £58 less overall per month.

Talk about wishing your life away:(

However my daughter assures me that an income of about $2365 per month should be plenty to live on as I won't be taking out a mortgage and just plan to buy a modest home with the money I get from selling my present house in Scotland.