Income Splitting

Sharing is caring, like income splitting.

Er, okay...income splitting is really a way to reduce how much you pay in taxes.

Income splitting is when some income from one spouse is said to have been earned by the other spouse in order for the couple stay in a lower tax bracket.

For instance, if one spouse makes a tiny bit of money Ubering and dog walking, and the other spouse is a successful Wall Street investor, the income from the Wall Street investor can be “split” with the spouse, putting the Wall Street investor in a lower tax bracket than they would be in without splitting the income.

In many Western countries income splitting is an option for couples, which is often more advantageous than not.