Commuted Value

Where do you live?

AB BC MB NB NL NS ON PEI QC SK NT NU YT

Alberta

Taxable income (maximum value $1,000,000)

100,000 Your Taxable Income Enter the taxable income amount from line 260 of your personal income tax return BEFORE the taxable portion of the commuted value.

Current age

55 Current age The age you plan on taking the commuted value. This is used to calcuate the amount you can transfer to a LIRA or LIF.

Commuted Value
Commuted value (before taxes)

A

A 800,000 Commuted value Enter the commuted value of your pension before any taxes.

Monthly pension amount

3,500 Monthly pension amount The monthly pension you will receive from your Defined Benefit plan.

Annual pension

B

B 42,000

Present value factor

C

C 10.4 Present value factor This number is used to calculate the maximum transfer value.

Maximum transfer value to LIF/LIRA (B times C)

D

D 436,800 Maximum transfer value The maximum that can be transferred on a tax-deferred basis to a LIRA or LIF.

Taxable cash (A minus D)

E

E 363,200 Taxable cash The difference between the Commuted value and the Maximum transfer value.

RRSP contribution

F

F 50,000 RRSP contribution If you have RRSP contribution room, you can deposit some of the taxable cash to your RRSP.

Taxable amount (E minus F)

G

G 313,200

Less taxes

H

H 158,696

After-tax amount (G minus H)

I

I 154,504

Commuted value (after taxes) (D plus I)

J

J 591,304

Lifetime Pension

Monthly pension amount

3,500

Pension received at start or end of month?

Start End

Index to inflation of (maximum value %)

2.00%

Pension paid for how many years?

25

Rate of return (maximum value %)

5.00% Rate of return This rate is used to calculate the present value of the monthly pension payments.

Lump sum (present value) of lifetime pension

740,315 Lump sum (present value) This is the present value of the monthly pension payments.

Results
Commuted value (after taxes)
Lump sum (present value) of lifetime pension