Tax rate on small CPP

Forum|Forum|3 years ago
October 30, 2022
1 reply
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My only taxable income is from CPP. It's only a few hundred dollars this year. How much should I spend on dental and medical expenses to offset my 2022 tax bill? I know I already spent more than 3%.

BrendaW-US

Many taxpayers expect to receive a deduction for every cent they’ve paid in medical expenses. The amount you can claim is actually based upon your income. Since the medical expenses credit is designed to assist Canadians who have significant expenses over the course of a year, only a portion of your medical expenses translates to a deduction. From your total medical expenses, the eligible amount is 3% of your income or the set maximum for the tax year, which ever is less. For example, if your net income is $60,000, the first $1800 of medical expenses won’t count toward a credit. If your medical expenses total, $2000, only $200 will be applied to your bottom line.

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robin__Author

Thanks. So I have determined my eligible rate is 3% of my income.CPP is my only taxable income and it is very small. What I would like to know is what is the tax rate on the CPP payments I have received. That way I can plan on how much I should spend on medical expenses before the end of the year.