What is Pension Income Splitting?

You can elect to split up to 50% of your eligible pension income with a spouse or common-law partner if; you were not living separate and apart from each other at the end of the year due to a breakdown in the marriage, and you are both resident in Canada on December 31.

Your eligible pension income includes the taxable part of life annuity payments received from a pension plan regardless of your age.  Your eligible pension income also includes annuity payments from an RRIF, LIF or an RRSP provided you were age 65 or older at the end of the year, or if you receive these payments due to the death of your spouse or common-law partner. The age of your spouse or common-law partner is not a factor.