If your dependant is ill, claim a higher deduction

Under the Income Tax Act, those paying taxes have the right to claim a higher deduction if their dependent is unwell in a manner specified under the Act. A specific set of symptoms and ailments, including neurological diseases and certain disorders etc, specified, give way for this higher deduction claim. This deduction claim is raised further if the one suffering is a senior citizen. A few further conditions apply; the patient is not allowed to claim deductions on a separate basis and has not, or will not be reimbursed for their illness by an employer, insurance company or a third party. Furthermore if the one paying the taxes has received only a certain amount as compensation, the balance can still be claimed.

Claim Child Care Expenses

Did you know that the money you spend on your young child can be reimbursed to a large extent? Luckily childcare expenses are tax deductible. However, the lower income spouse is entitled to these claims only. Childcare expenses include the following: Babysitting fees PLASP fees Daycare After-school programs There is a cap on the total deductible amount that can be claimed. For children born in 2004 and later, the maximum deductible amount for child care expenses is $7,000 per child. For children born between 1994 and 2003, the maximum deductible amount for child care expenses is $4,000 per child.

Pay your older child wages for babysitting the younger

Paying your adult child money for babysitting your under 16’s, makes room for a tax saving opportunity. This tactic will allow you to claim a tax deduction for fees paid to your older child (16 or older) for babysitting your younger child. Childcare expenses, which include babysitting fees, are tax deductible. Another advantage of this strategy is income splitting. The payments you are making to your older child will be included in his/her income for tax purposes. There is a high probability that the tax he/she would be paying on this income would be a negligible amount. Another favorable aspect of this situation is that your child who is now earning income will be entitled to RRSP contribution room. Hence, this minor form of income splitting results in a beneficial situation for the whole family, in terms of beating the tax man.

Claim deductions for your university child's education

Whether you are a college student or a university student, you can make some important claims. Full time students can claim around 65 dollars a month, just for text books and if you are a part time student that number drops to 20 dollars a month. However text book amounts are not the only aspects of education that entitle you to a claim. As a university or college student, you are also entitled to a 400 dollar amount (full time) monthly or a 120 dollar monthly amount (part time).

Best of all, any unused portion of their tax credits can be transferred to a parent, grandparent, spouse or common-law partner. This can prove to be surprisingly rewarding just by simply being aware of all of the potential claims that you and your family are entitled to.

You may not need to pay for tax software

You don’t have to pay for tax software to use the NETFILE service. The Canada Revenue Agency lists several online programs that are 100% free and certified to work properly with its systems (see cra-arc.gc.ca).

Claim your transit pass

Bought a transit pass?If it covers at least 28 consecutive days you can claim 15% of the value—and there’s no limit on how much can be claimed.