Pension Income Splitting Calculator Canada 2025
Calculate tax savings from splitting eligible pension income with your spouse, find the optimal split percentage, and see the impact on OAS clawback.
Estimates use 2025 combined federal + provincial rates. Not financial advice.
Try another scenario
How to Use This Calculator
Tab "Splitting Estimate"
Enter your eligible pension income (employer pension, RRIF withdrawals, annuities), your other income (OAS, CPP, employment โ not splittable), and your spouse's income. Select your province. The calculator shows the combined household tax without splitting vs with a 50% split, and the annual tax saving.
Tab "Optimal Split"
Same inputs as the Splitting Estimate, but the calculator tests every split percentage from 0% to 50% in 5% increments. It builds a table showing the combined tax at each level and highlights the optimal split percentage that minimizes your household tax. Sometimes 50% is not optimal โ if the split pushes your spouse into a higher bracket, a lower percentage may save more.
Tab "OAS Clawback Impact"
Enter your total income, the eligible pension portion, and your spouse's income. The calculator shows your OAS clawback before and after splitting, the tax saving, and the total combined benefit (tax + OAS). It also warns if splitting would trigger a clawback for your spouse.
The Formulas
Combined tax = Tax(your income - split amount) + Tax(spouse income + split amount)
Split amount:
Split = eligible pension income x split percentage (max 50%)
Tax saving:
Saving = Tax(no split) - Tax(with split) for both spouses combined
OAS clawback (2025):
Clawback = (net income - $93,454) x 15%, capped at max OAS (~$8,560/year)
Fully clawed back at approximately $151,000 net income
2025 key numbers:
Federal BPA: $16,129 | Federal brackets: 15% to $57,375; 20.5% to $114,750; 26% to $158,468; 29% to $220,000; 33% above
OAS clawback threshold: $93,454 | Recovery rate: 15% | Form T1032 required
Combined marginal rates include both federal and provincial tax. The transferring spouse must have eligible pension income. Both spouses must file Form T1032 and agree on the election.
Example
John ($80K pension + $20K other) and Mary ($25K) โ Ontario, 50% split
John has $80,000 in eligible pension income (RRIF withdrawals) plus $20,000 in other income (CPP/OAS). Mary has $25,000 in income. They live in Ontario and elect to split 50% of John's pension.
By splitting 50% of his $80K pension to Mary, John and Mary save approximately $5,200 per year in combined taxes. John drops from a higher bracket to a lower one, while Mary's additional income is taxed at her lower marginal rate. The $2,000 pension income amount credit also transfers to Mary.
OAS bonus: If John's total income were above $93,454, the split would also reduce or eliminate his OAS clawback โ an additional saving of up to $8,560/year.