This 2011 Election is already shaping up to be an interesting one for accountants: not only do we get to vote on the due date (April 30 is on a Saturday so taxes are due on election day, May 2) but we are seeing some interesting tax proposals.

The Conservative Party of Canada announced today a “Family Tax Cut” in which a couple, with at least one child under the age of 18, could save taxes by sharing up to $50,000 of income between them.

Now, exactly how the mechanics would work on this is not known, and this proposal is dependent upon the Conservatives being in power 5 years from now.

Nevertheless, for interests sake, lets take a look at the potential federal tax savings a couple may derive from this: Family Tax Proposal.

We only look at Federal taxes because Provinces would not have to follow the lead of the federal government.

As you can see in the spreadsheet above, a family where one spouse is making $100,000 and the other is making $0 would save about $3,747 of taxes by splitting their income $50,000 each.

A family with a spouse who makes $60,000 and the other makes $20,000 would only save about $1,332 (by being taxable at $40,000 each).

And, it’s not on the spreadsheet linked above, but for the executive who makes $200,000 while the spouse stays at home to look after the kids? The federal tax savings are about $6,525.

These are meant to be just the numbers, thanks: as usual we make no judgments on policy nor politics.

Especially when we have to put our heads down to finish off another stack of tax returns!