one or both of you are receiving a CPP retirement
pension, and
were living together during the time one or both of
you were contributing to CPP (during your joint contributory period)
you can apply to receive equal shares of the CPP
retirement pensions that you both earned during the years
you were living together.
This could be beneficial if one spouse is in a higher tax
bracket, but clawback of Old Age Security, spousal amount and age amount tax credits must be considered.
See the tables of
non-refundable personal tax credits for levels at which the tax credits
are reduced or eliminated.
The CPP splitting is merely an assignment of part of the pension in order to
reduce income tax. When the pension sharing/assignment ceases (upon death,
or other circumstances), the pension amount of each spouse is adjusted to the
amount that they were to receive before the pension-sharing arrangement.
Other pension income may also be split with a spouse in order to save tax. See the article on pension
income splitting on the Personal Tax page.
Tax Tip: You may save tax by
splitting CPP retirement pension with a lower-income spouse.