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Personal Tax -> Dividend tax credits ->Tax Rates -> Tax Comparisons -> Tax comparison for seniors with investment income -> 20202020 Seniors Tax Comparison: Canadian Dividends vs Other Investment IncomeThe table on this page compares taxes payable by province in 2020 for two different types of income:
To the above income we add:
The calculations assume that the income is received by a single senior. The tax rates used are as known on April 18, 2020. Notes:
The first comparison uses $30,000 of eligible dividends compared to $30,000 of other income.
The following table compares the taxes payable on the above incomes - the taxes payable include any applicable OAS clawback.
You can see above that in BC and a couple of the territories, more than double the income tax is payable with interest instead of eligible dividends. The next comparison uses $50,000 of eligible dividends compared to $50,000 of other income.
The following table compares the taxes payable on the above incomes - the taxes payable include any applicable OAS clawback.
Although the higher taxable income with Canadian eligible dividends causes a clawback of the OAS and a higher clawback of the age credit, the taxes payable are still significantly lower. To see the tax results for your own income situation, and how it would change if the type of investment income changes, use our Detailed Income Tax and RRSP Savings Calculators, and our very simple Investment Income Tax Calculator. See also Tax Comparisons by Province and Territory, which compare different levels of employment income for people who are not seniors. Tax Tip: Although Canadian dividends increase the OAS clawback, the net tax payable is still much less than with interest or foreign dividends. Revised: October 26, 2023
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