Those who are new in Canada may be surprised to discover that there are actually a lot of tax benefits, credits, and deductions in the country. All of these can be very helpful for families plus they can significantly reduce the amount you need to pay come tax time.
Here are the basics you should know about the tax benefits in Canada:
- Canada Child Tax Benefit (CCTB). If you are raising kids below 18 years of age, you may take advantage of the tax-free monthly payment. To qualify for this, you and your spouse should file for an income tax and benefit return each year – even if you did not receive any income during the year.
- Universal Child Care Benefit (UCCB). On top of that, parents with children under 18 years old may also avail of this taxable benefit which provides child care support. Parents will be allowed to receive up to $160 per month each eligible child (6 years old or under). Children ages 6 to 17, on the other hand, will get $60 per month.
- Goods and Services Tax/Harmonized Sales Tax (GST/HST) credit. This tax-free quarterly payment can be helpful for individuals and families with low to modest income. You need to file and income tax and benefit return per year to be able to receive this credit. If you are married or have a common-law partner, only one of you can receive the credit.
- Working Income Tax Benefit (WITB). Working individuals and families with small income can claim this refundable tax credit. Additionally, this one has a supplement for eligible individuals for disability tax credit.
- 5. Family Tax Cut. This non-refundable tax credit worth up to $2,000 is available for eligible couples with children under 18 years of age.
- Children’s Fitness Tax Credit. If your children participated in an eligible program or physical activity (such as soccer, golf, etc) in 2014, you may be able to get $1,000 per child of the program cost. You may also claim additional $500 for disability tax credit.
- Children’s arts tax credit. If your children participated in artistic, cultural, developmental (such as tutoring), and recreational activity in 2014, you can claim $500 of the paid fees per child. An additional $500 can also be claimed for those eligible for disability tax credit.
- Child care expenses. If you and your spouse spent for an eligible child care program (such as day camps) or daycare in 2014, you or your spouse (or common-law partner) may be able to claim your expenses back.
- Disability amount. For family members with severe and prolonged physical or mental impairment, you may claim disability tax credit if you can submit a completed Form T2201, Disability Tax Credit Certificate, and a certification from a qualified medical practitioner.
- Family Caregiver Amount (FCA). You may claim an additional amount of up to $2,058 if you are caring for a dependant family member with physical or mental concerns.
For additional information, you can check out the Canada Revenue Agency website at www.cra.gc.ca/getready for online services and more.