Investing in Seniors

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Canada's seniors have witnessed unprecedented changes in our society. Through it all, seniors have worked hard, raised their families, and built their communities.

Our Government has also worked hard to deliver on our promises to seniors by:

• cutting taxes
• giving them a say in issues that matter to them; and
• helping them become more involved in their communities.

We are investing in seniors, because seniors have invested in Canada.

In the months to come, Monte Solberg, Minister of Human Resources and Social Development, and I look forward to helping the Government of Canada do even more for seniors across this great country.

Yours sincerely,

Marjory LeBreton
Secretary of State (Seniors)

Tax Relief

The Government of Canada is delivering new tax relief to help seniors keep more of their hard-earned money.

Less of seniors' income will be taxed

Taxes have been reduced for low and middle-income seniors aged 65 or older, raising the maximum amount eligible for the age credit to $5,177 for the 2007 tax year. With less income taxed, seniors save more.

Pension income splitting

When filing income tax returns for 2007, couples will be able to reduce their combined taxes by transferring up to half their eligible pension income to the lower-earning spouse or common-law partner. Such couples would then pay less tax.

Registered Retirement Savings Plans (RRSPs)

The age limit for converting RRSPs has been increased from 69 to 71. This strengthens incentives for older Canadians to work and save.

More tax relief

Seniors will also benefit from:

• the increase in the maximum amount eligible for the spouse or common-law partner credit to $8,929, which will provide additional tax relief of up to $209;
• the doubling of the maximum amount eligible for the pension income credit to $2,000, for a total tax reduction for the 2007 tax year of up to $310;
• the offer of a tax credit for certain transit passes;
• the lowering of the GST to 5 per cent; and
• the increase to the maximum amount that may be claimed under the refundable Medical Expense Supplement to $1,022 for the 2007 tax year.

Improving Old Age Security

The Guaranteed Income Supplement (GIS) was increased by about $216 per year for single recipients and $348 per year for couples on January 1, 2006. It was increased by the same amount again on January 1, 2007.

As of May 2007, eligible seniors only have to make a one-time application for the Guaranteed Income Supplement. As long as they file income tax returns, they will never have to reapply.

Budget 2008 proposes to enhance the GIS by exempting the first $3,500 of earnings-the average amount of earned income by working GIS recipients. Seniors who choose to work will be able to keep more income without any reduction in GIS benefits.

Investing In Canada's Future

Fifty years ago, 1 in every 13 Canadians was a senior. Today, it's closer to 1 in 8. And by 2031, it's expected to be about 1 in 4.

The Government of Canada is addressing the challenges in the workforce brought on by Canada's aging population. We have:

• created an expert panel to study issues faced by older workers, making sure they have the knowledge and tools they need; and
• created the National Seniors Council to give seniors a say in issues that matter to them. For more information, visit: www.seniorscouncil.gc.ca.

Supporting Caregivers

The Government of Canada recognizes that caring for a loved one due to illness or disability often involves additional expenses or time away from work.

The Employment Insurance Compassionate Care Benefit helps replace lost income when a qualifying person takes a temporary absence from work to care for a loved one who is at significant risk of death. In 2006, the Government of Canada expanded the program to make more family members and friends eligible for the benefit. Canada is one of the few countries in the world to offer this kind of benefit.

As well, eligible caregivers may realize savings through the Medical Expenses Tax Credit, the Caregiver Tax Credit and the Infirm Dependant Tax Credit.

Engaging Seniors, Strengthening Communities

The New Horizons for Seniors Program funds activities that are led by seniors, such as volunteering, mentoring, teaching and reaching out to isolated seniors.

The Government of Canada increased the budget for New Horizons from $25 to $35 million in 2007. The new funding will help raise awareness of elder abuse and fraud. It will also enable repairs to community buildings and the replacement of equipment that is used for seniors' programs. For more information, call 1-800-277-9914 or visit: www.hrsdc.gc.ca

Budget 2008 proposes an additional $13 million over three years to address elder abuse. Measures will include a public awareness campaign.

For information about the tax measures mentioned in this brochure:

CALL 1-800-959-8281
TTY: 1-800-665-0354
CLICK www.cra.gc.ca

For more information on Government of Canada programs and services for seniors:

CALL 1 800 O-Canada (1-800-622-6232)
TTY: 1-800-926-9105

CLICK servicecanada.gc.ca

VISIT a Service Canada Centre

For more information of interest to seniors:

www.seniors.gc.ca

This publication is also available in alternative formats.

Également disponible en français

©Her Majesty the Queen in Right of Canada, 2008
ISBN: 978-0-662-47960-4
Cat. No.: HS4-48/2008E