CRA to Retirees: 5 Ways to Avoid the 15% OAS Clawback
Retirees in Canada receive a significant amount of retirement income through the Old Age Security (OAS). The maximum monthly payment amount is $615.37 (January to March 2021), so a typical retiree could receive $7,384.44 annually in the course of the retirement years.
Since the Canada Revenue Agency (CRA) considers the benefit as taxable income, retirees have to contend with a recovery tax. The 15% OAS clawback impacts a retiree’s income. It reduces the benefit amount, especially of retirees in higher income brackets. Hence, it’s a yearly battle with the tax agency to avoid the dreaded clawback.
Original Article Source Credits: The Motley Fool , https://www.fool.ca/
Article Written By: Christopher Liew, CFA
Original Article Posted on: March 22, 2021
Link to Original Article: https://www.fool.ca/2021/03/22/cra-to-retirees-5-ways-to-avoid-the-15-oas-clawback/
Categories
RECENT POSTS
- » The Basics of Financial Statement Preparation: A Step-by-Step Guide
- » Strategic Estate Tax Planning: Minimizing Tax Liability for Your Heirs
- » Smooth Transitions: Key Steps in Business Succession Planning
- » Meet The Face Behind Saklas & CO., CPAs
- » Solving Common Problems That Most Small Businesses Face
- » Season’s Greetings From Saklas & Co., CPAs
- » Tips To Get The Most Out Of Your Tax Return
- » TFSA Users: You Could Pay 15% Tax on Dividends With 1 Costly Mistake