Kevin Milligan - Income Splitting Kevin Milligan ~ Vancouver School of Economics ~ University of British Columbia

Income Splitting Simulator

Below is an Excel spreadsheet that simulates the Family Tax Cut income splitting policy as announced in November 2014.

The Department of Finance backgrounder is here.

The Ways and Means motion is here. Note that the exact implementation of the 'notional' family tax cut credit is confusing--in particular how the spousal credit works in the notional tax calculations. In the simulator, I assume that the spousal credit disappears when the notional transfer is large enough to get the lower income spouse over the $11,138 spousal credit threshold. That is, each spouse gets their own basic amount, but the spousal credit disappears under the notional calculation. Other interpretations of the Ways and Means motion is possible.

The spreadsheet simulator is here.

This simulator may be used for any non-commercial purposes. I cannot guarantee its accuracy. I am happy to receive feedback through email.



kevin.milligan@ubc.ca ~ Home Page ~ Vancouver School of Economics ~ UBC