March 20, 2018
The pension industry is calling for change to the Income Tax Act in order to keep it relevant to societal trends, including Canadians living and working longer.
Benefits Canada discussed the topic with partner Susan Nickerson, who agrees that change should be made after herself and other members of a subcommittee of the Association of Canadian Pension Management identified areas with room for improvement. Below is an excerpt from the article.
[…] The Income Tax Act forces Canadians to start withdrawing from their registered retirement plans no later than the end of the calendar year in which they turn 71. But given current longevity projections and an environment of softening investment returns and interest rates, the government should raise the age limit to provide more flexibility around Canadians’ retirement savings, says Nickerson, who suggests increasing it to 73 or 75. […]
Ultimately, Nickerson believes the tax system should do more to consider the evolution of socioeconomic factors affecting Canadians today.
“The revisions to those underlying factors should be approached consistently throughout the act,” she says. “It would be good to have some type of automatic review period, like every five years, that would ensure those assumptions remain appropriate.”
To read the insight-packed article from Benefits Canada, click here.
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