Seniors get all the tax breaks?

We calculated the benefits and taxes for a fictional 67-year-old couple

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From the April 2016 issue of the magazine.

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Governments do more for older people. While it’s important to note that some seniors struggle as well, it is also true that governments make it easier for middle-class retired seniors with decent finances to live comfortably. To assess this, we calculated the seniors benefits and taxes for a fictional 67-year-old Ontario couple we’ll call John and Judy Connelly. Although their combined $66,000 income is less than the Spencers, their expenses are a lot lower as well because their home is paid for, their children are self-sufficient, and they no longer have work-related costs. With less income, they also pay less income tax. Chances are they have more disposable income on hand than the Spencers to spend on their lifestyle (or put to other good uses, such as helping their children).

Their benefits and taxes put them ahead by about $9,000–almost $24,000 better than for the Spencers. “The government is much kinder to us,” says Malcolm Hamilton, both a retirement expert and a retiree himself. “We’ve got relatively low expenses so we don’t need a big income and have lower taxes.”

Providing more help for daycare costs would be a good place for government to start. Paul Kershaw, executive chair of the Association for Generational Equity would like to see universal daycare support at $10 per child per day. Others would prefer seeing more money or bigger tax credits go directly to families instead.

Kershaw stresses that his group doesn’t advocate taking money away from seniors to pay for more child and family programs. In the past, social programs were expanded and financed relatively painlessly by diverting some of society’s growing wealth, but with a slow-growth economy, that is trickier these days. As well, an aging population is making it more difficult to continue to fund existing social programs and entitlements to their historical levels, so it’s unlikely that a lot of new money can be found without taking it from someone else.

Surviving the crunch »

What benefits and breaks do you get - David Aston

3 comments on “Seniors get all the tax breaks?

  1. First off – when our kids were young, we didn’t have all the family tax breaks & benefits available now. We got a $20/month family allowance and a small amount for dependents were claimed on income taxes. We paid child care expenses on our own with no tax breaks. We struggled with 20% interest rates. Owning a home was not in the cards for us until our late 30’s. We never had vacations until the kids were grown, nor did we have the latest technology. We didn’t have to have a renovated home – we were happy to have a roof over our heads. A can of paint was enough for a reno. He saved every cent we could for retirement. Each year, retirees benefits are being cut or reduced ie. Buses, ferries, etc. Many like us don’t have government jobs or large pension plans to fall back on. We don’t all have full CPP or OAS pensions either. Many pay our own medical bills which are a major expense for those of us with medical conditions. We help our kids by babysitting, buying clothes for the kids or the odd necessity that we can. Can we not enjoy the rest of our days to enjoy what little money we have left.
    without someone complaining or in our back pocket trying to take it away?


  2. That’s exactly how it’s supposed to work. Seniors pay less tax because (unfortunately) they have less income, same as anyone else with less income. Seniors get more benefits because they have completed their obligation to pay in advance for these benefits, Why are you advocating taking money from the pockets of the one group of people who are not in a position to replenish it? And why would younger people wish this upon themselves later in life, and on their parents now (reduced inheritance and/or providing extra financial support to parents). That’s like saving once and paying twice for the younger ones!


  3. My partner of 20 years and I maintain separate financial lives, but contribute to a common pool for household expenses. We are both retired and collect CPP and OAS. Since we file our income tax returns as single, can we apply for GIS as single?


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