Many people look forward to the day when they can collect their pensions that they have spent years contributing to. Some individuals have private as well as government pension plans that they are entitled to. From the government many retirees expect to receive both the Canada Pension Plan as well as the Old Age Pension.
Quite often new pensioners are not quite sure just what the amount is going to be of these two new sources of income. The CPP is based on the number of working years that an individual contributed to their pension. In a lot of cases one of the parents had to refrain from working for a number of years so they could be the stay at home care giver for their youngsters. Some did not realize this was going to have an effect on the amount they would end up receiving by way of CPP during their retirement years.
A lot of people don’t realize it but there may be an opportunity to recoup these lost years in regards to the CPP through the child rearing provision offered by the Canadian government.
This may be applicable to you if your children were born after the end of 1958, and your earnings were reduced or stopped so you could take on the role of primary caregiver for the children under the age of seven. You also would have had to been eligible to receive the Canada Child Tax Benefit during that time.
If you meet the criteria for this provision you really should apply for it as it can increase the monthly amount of the CPP you are receiving now. Also if you are in need of the CPP disability it could also help you become eligible for this, and in the event you become deceased it can play an important role for making sure you have met the contribution requirements required for death benefits for your survivors.
If you are a senior using our services here at Toronto accountant this is just one area of tax that we will bring to your attention. We make every effort here to insure that our clients are getting all that they are entitled to from the government whether they are seniors, business or just the average tax payer. This is just one of many instances when it comes to increasing your income or lowering your taxes that may be available to you, yet can be easily missed when attempting to do your taxes yourself.
