Additional information for the time machine
The TIME MACHINE will end on December 31st of the set year of passing (or that of your spouse, if it consists of a later date). Death always occurs on Dec 31st and final tax calculation is done. This calculation assumes that all inheritances will go tax-free to the widow(er), when allowed to do so by legislation. If the account/property is not held jointly and a spouse is not named as a beneficiary, it'll pass to the Estate.
If there is a surviving spouse, pension, CPP/QPP and OAS survivor benefits will be calculated along with any life insurance proceeds..
Tax inputs
For the first year, the TIME MACHINE requires to know how much taxes and deductions that you have already paid. It needs to know how much room is currently available for RRSP, TFSA and FHSA contributions. It will ask about any taxes and benefits already paid and received up to now (this includes payments at-source from your employer, paid instalments, and withholding taxes). You can obtain this information from your pay slips and from the CRA website. Only relevant information is asked for, such that it won't ask for the RRSP room if you are over 71, nor the TFSA room if you did not input a TFSA account, nor the Canadian Child Benefits you are receiving if you have no young children.
If you are already collecting the OAS or will this year, please enter `Previous year taxable income'. It is used to calculate OAS and OAS benefits (GIS and Allowance) payments accurately. You can get that number from your last tax return. Do not include OAS and OAS benefits income in that amount.
If you are already collecting OAS, CPP or QPP, then please enter the annual amount that you are receiving.
If you are already collecting US Social Security, we may also require you to enter the amount you are receiving in USD/month
The TIME MACHINE also needs to know any other income generated by your investments in non-registered accounts year-to-date. This will make tax calculations for the current year more accurate. Include values of the distributions you have received in all Non-Registered accounts owned by you or jointly with your spouse, but not your CCPC. For non-registered accounts owned by your spouse, the corresponding amounts should be entered separately on their form that will appear on the following screen after yours. Enter the gross amounts for interest and foreign dividends, eligible dividends (from Canadian public corporations), and non-eligible dividends (only if you personally invested in a CCPC that is not your own). Also enter any gross realized capital gains (not reduced by losses) year-to-date. Realized capital losses for the current year are entered separately. You will also need to enter the amount of losses carried forward from previous years.
If you set to have the Alternative Minimum Tax calculated (in your PREFERENCES) you will also be asked for the amounts of minimum tax you have paid in the last 7 years. You should enter only the Federal amount or the Québec amount as appropriate.
The Save values for this session? box can be checked if you do not need to go over these inputs before running the TIME MACHINE next time.
Note if there is a defined benefit pension plan.
You will receive an alert if you have entered a Defined Benefit Pension Plan and the set age of death for the holder is before the pension is to begin. If you estimate your passing to occur before the start of the pension, the commuted value can be estimated in the TIME MACHINE using an actuarial calculation, and the pension will surrender the calculated value as a taxable lump sum to the estate, or if there is a spouse and they own an RRSP, the funds will be transferred there tax free. A surviving spouse could also have the option of receiving an immediate ongoing pension but we have not implemented that option.
You will be able to see the TIME MACHINE estimate but bear in mind that it is only a gross estimate and could be very inaccurate. If you have set your contribution to the plan to go until the start of the pension, we first adjust the amount of the pension by reducing the years of service. The interest rate we use in the calculation is the inflation rate at the date set (which should be close to the average 5-year personal deposit rate used by major banks, and therefore by many pension plans). We use the Annuity 2000 Basic mortality table. We consider if the pension is indexed, but do not consider the value of any survivor guarantees or other features of the pension.