Q&A: RRIFs and the pension credit
Question: Does a RRIF qualify for the $1,000 pension income deduction? – Frank J.
Gordon Pape answers: Yes, but only under certain circumstances. Before I explain them, let me clarify a point. You refer to this as a “deduction”. It is not – it is actually a tax credit. You are allowed to claim a “pension income amount” of up to $1,000 at line 314 on the tax return. The federal tax credit is worth 15 per cent of that, or $150. The provincial credit is on top of that, so the total credit will usually be worth between $200 and $250, depending on where you live.
You can claim income from a RRIF at line 314 if you are age 65 or older or if you received the payments because of the death of a spouse or common-law partner. So you can’t just set up a RRIF at any time and make this claim.
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