Treatment of Non-Refundable Credit in FTC Calc for Canada

[Canadian Newbie]

I am a US citizen and perm resident in Canada. This year I am reporting a US based foreign pension for the first time. There are no deductions against the pension however, I am allowed the 2,000 non refundable credit for the pension amount on Sch. 1. This saves $300 of tax. When computing the FTC on form T2209, do I have to somehow factor this in to the numerator which is net foreign non business income? I figured no since it is not a deduction arriving at the demoninator which is net income. However, when you think about it, the tax paid on the pension amount is effectively smaller since your are not allocation %100 of the tax credit amount as a reduction.
Or does the calculation ignore the source of the credits and just use the tax after the crdits to determine the tax paid on the foreign income?

Any help would be appreciated.

[nelsona]

There are some things that might reduce the amount of foreign income that you would use to calculate your FTC, but the "pension" deduction is not one of them.

If anything, you would reduce your foreign income by $2000, not reduce the foreign tax by $300. In any event, neither is required.

Use the full gross amount of your US pension in the formula, and the full amount of your US tax.

[Canadian Newbie]

Thanks.
On the US 1040 side, in computing the Canadian tax paid for the US foregn tax credit, I also have not factored in the Canadian non refundable tax credits for the computation other than simply starting with the basic tax on line 429 and taking the percentage applicable to the income based on taxable income as the denominator. In the numerator I do take into effect any of the deductions before taxable income though to derive the CDN tax paid on the income. Like I said, when you think about it, the tax attibutable to any income where there is a non refundable tax credit is in reality a little less based on the credit. The instruction for the US FTC makes no mention other than taking "deductions" into effect.
Not a big deal anyway in my case because my US tax is a lot less than the Canadian tax. I have FTC carryovers that I will never use and they just get larger every year.

Thanks again for the help.

[nelsona]

As I've sais, I'm not doing detailed looks at "do my taxes" questions, but yours sounds incorrect.
In calculating FTC for dual filers, like you, you prepare the ENTIRE tax returns BOTH, but without the FTC ONLY. You don; ttaje off anything else.

Then you use the tax and income BEFOTE FTC, to calculate the FTCs aon BOTH returns.

If you are doing anything else, it is wrong.

[Canadian Newbie]

Thanks. My post was confusing.
I am using the tax just before the FTC on both returns to calculate the taxes paid for each FTC. I make sure all of the income and deductions are correct on both US and Canadian and then I finally work on the FTC amounts after I know the tax before FTC is cast in stone.

Thanks again for the help.