If you are a senior, you have likely paid into many types of retirement income and benefit plans. Here are some tips to make sure you are collecting all the benefits to which you are entitled.
Know what you paid into – “The major sources of retirement income plans that Canadian seniors pay into through contributions include the Canada Pension Plan (CPP), group Registered Retirement Savings Plans (RRSPs) and individual RRSPs,” says Chartered Accountant Angèle Charbonneau, a partner with Laberge Venne & Partners Professional Corporation in Sudbury. “Other sources include company pensions, encompassing both defined contribution and defined benefit plans.”
Make sure you apply – “CPP, Old Age Security (OAS) and Guaranteed Income Supplement (GIS) benefits are not automatically provided,” explains Charbonneau. “You must apply for the initial benefits and for the GIS. Annual tax returns must be filed by April 30 each year to ensure continued payments. If you do not file your return on time you will need to re-apply.”
If you are age 60 to 64 and your spouse or common-law partner receives the OAS and is eligible for the GIS, or has died, Charbonneau suggests you apply for the spousal allowance. “If your children were born after December 31, 1958 and your CPP contributions were reduced while you stayed home to look after them, you may be eligible for an increase in your monthly CPP benefit,” Charbonneau adds. “Again, you must apply for this additional benefit.’
Keep careful records and keep in touch – “Keep a record of all pensions to which you are entitled in a safe place,” advises Charbonneau. “Once you are eligible for them, be sure to apply. You must also ensure that previous employers and pension providers have your current address because they will only be able to provide your benefits if they know where you are.”
Maximize your income from tax credits – “Filing annual personal income tax returns will ensure you continue to receive the Goods and Services Tax/Harmonized Sales Tax (GST/HST) credit, receive sales and property tax credits when applicable, and permit Ontario seniors (aged 64 or older on December 31) who qualify to apply for the Senior Homeowners’ Property Tax Grant,” says Charbonneau. “Seniors with health issues should also apply for the federal Disability Tax Credit. Their eligibility will depend on the state of their health, which must be certified by a physician.”
Talk to a Chartered Accountant – “A CA can help with your pre-retirement and post-retirement income planning, in order to maximize available benefits and tax credits and minimize clawbacks of your OAS and age credits,” Charbonneau suggests. “Your CA can also help you understand your entire tax situation, including how realigning your personal investments and holdings can generate retirement income while preserving OAS and other income-tested benefits. Finally, your CA can help you file all the personal income tax returns required to achieve optimal pension-income splitting, obtain OAS and GIS benefits and claim all available tax credits.”
Brought to you by the Institute of Chartered Accountants of Ontario
The Institute of Chartered Accountants of Ontario is the qualifying and regulatory body of Ontario’s 33,000 Chartered Accountants and 5,000 CA students. Since 1879, the Institute has protected the public interest through the CA profession’s high standards of qualification and the enforcement of its rules of professional conduct. The Institute works in partnership with the other provincial Institutes of Chartered Accountants and the Canadian Institute of Chartered Accountants to provide national standards and programs that are used as examples around the world. </em>
