Tax information for retired members

Your pension is taxable income. We will deduct federal and provincial income tax from your monthly pension payment.


Deductions from your monthly pension payment

Your pension is taxable income. This means we deduct income tax from your gross monthly pension payment. The amount we deduct is based on the income you receive from BC's Public Service Pension Plan. Your other sources of income may have tax deducted at a different rate.

The net monthly pension payment is calculated as follows:

  • Your gross pension amount
  • Minus income tax
  • Minus (if applicable) monthly premiums for extended health care and dental coverage

The amount of income tax we deduct from your monthly pension payment depends on where you live. Each province and country has its own tax rate. We use the tax rate for your province of residence or, if you live outside Canada, the tax rate for the country where you are living, as specified by the Canada Revenue Agency (CRA).

Note: The amount we deduct from your monthly pension payment assumes your pension is your only source of income. If you have other sources of income, such as benefits from the Canada Pension Plan or old age security, this could put you in a higher tax bracket and result in more taxes owed.

How to request that we deduct additional tax

You can ask us to deduct more income tax from your monthly pension payment. Send us a written request that includes your full name, signature and three personal identifiers such as:

  • Person ID (find this on your pension statement)
  • Date of birth
  • Telephone number
  • Address

If you send your request electronically, we don't need your signature. 

As part of your request, please tell us how you want the additional income tax deducted:

  • Total dollar amount
  • Additional dollar amount
  • Total per cent

Income splitting and your pension

You may be able to reduce the total tax you pay by transferring part of your pension income to your spouse   or common-law partner.
 

This process, known as income splitting, allows individuals to allocate a portion of their income to a spouse who has lower earnings. This may create tax savings for couples.

Contact CRA for more details. You may also want to speak with a financial adviser or accountant to find out if transferring part of your pension income is to your advantage.

 

Page last updated: March 16, 2018


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The plan recently announced changes, effective October 1, 2019, that will result in a past service pension adjustment for you if you have service between April 1, 2006 and March 31, 2018. For more information, see the Board Communique: March 16, 2018.

IMPORTANT plan changes:

Board Communique: March 16, 2018

External link for tax information for retired members

Learn more about pension income splitting on the Canada Revenue Agency website.