Pierre, a financial advisor in Alberta, is advising Robert, 66, and his wife Anne, 64, on their retirement income. Robert receives a substantial defined benefit pension and has a RRIF, while Anne has a smaller RRSP and receives CPP benefits. Pierre suggests they consider pension income splitting. What is the maximum percentage of Robert's eligible pension income that can be split with Anne?

Question: Pierre, a financial advisor in Alberta, is advising Robert, 66, and his wife Anne, 64, on their retirement income. Robert receives a substantial defined benefit pension and has a RRIF, while Anne has a smaller RRSP and receives CPP benefits. Pierre suggests they consider pension income splitting. What is the maximum percentage of Robert's eligible pension income that can be split with Anne?

Answer options:

• 100%
• 75%
• 60% ✅ 50%

Correct answer: 50%

Explanation: Under Canadian tax rules, an individual receiving eligible pension income may elect to split up to 50% of that income with their spouse or common-law partner, effectively lowering tax payable if the spouse is in a lower tax bracket.