While there is still time before we have to worry about filing our 2018 tax return, being sure you understand what tax savings are available to you is important to ensure that you properly prepare for the upcoming tax filing season and maintain the proper records.
Here are common tax credits that can be claimed by individuals, families, and working Canadians.
GST (Goods and Services Tax) Credit
For families with mid to low incomes, a quarterly tax-free payment is available to help offset some or all of the GST we pay on purchases.
For those who are married or in a common law relationship, the GST credit is only available to one of you. This is determined by the tax return that is reviewed by the Canada Revenue Agency first.
There is nothing you have to do to apply for the GST Credit aside from filing your taxes. This is because the government automatically determines eligibility and the amount that will be received when the tax return is filed.
If your marital status changes in the tax year it is important to report it quickly. This is because it may change whether or not your receive the credit and how much you will get. If you do not report marital status changes in a timely manner, you may end up owing the government for over payments or have a delay in receiving payments that are newly owing to you.
Medical Expenses Deduction
There are a number of eligible medical expenses for which an income deduction can be claimed on your tax return.
The amount you can claim a deduction for is equal to you, your spouses and your dependants, and only on medical expenses less than 3% of your income or the given limit - in 2017 it was $2,268; 2018 will be announced closer to the 2018 filing season.
Child Care Expenses
While Canadians are no longer able to claim the children’s art and fitness expenses, the deduction for child care expenses is still available.
Under this deduction, you can claim payments made to an individual or child care facility that looked after your child while you were making money from employment or self-employment, attending school or conducting research.
The amount you can deduct depends on a number of factors - to find out more about this deduction, please read our blog What You Need to Know About Deductions and Credits for Child Care.
Child Disability Benefit
Families are able to claim the child disability benefit to recover the costs associated with caring for a child with a severe disability. This amount can only be claimed if you have filed a T2201.
For more information of common tax credits, benefits and deductions that you should be planning for, contact us today!
