Starting with the 2007 tax year, the Government of Canada allows a non-refundable tax credit based on eligible child fitness expenses paid up to $500 per child by parents to register a child in a prescribed program of physical activity.
The children’s fitness tax credit lets parents claim up to $500 per year for eligible fitness expenses paid for each child who is under 16 years of age at the beginning of the year in which the expenses are paid.
If a child qualifies for the disability tax credit, parents can claim up to $500 per year in eligible fitness expenses paid for the child who is under 18 years of age at the beginning of the year. Also, if at least $100 in eligible fitness expenses has been paid for the child, an additional amount of $500 can be added to the eligible fitness expenses actually incurred.
Please note that the child fitness tax credit will be calculated using the lowest tax rate (15% for 2008), so the maximum tax credit per child for 2008 will be $75.
]]>| Child care costs are not claimed as a non-refundable tax credit, but as a deduction from income on line 214 of the personal tax return. A non-refundable tax credit is always at the lowest tax rate (except in Québec), but a reduction of income would save tax at the taxpayer’s marginal tax rate.
Eligible Child Care Expenses include day-care centres and day nursery schools, some individuals providing child care services, day camps and day sports schools, educational institutions such as private schools (the portion of tuition costs relating to child care services), boarding schools, and overnight sports schools and camps. Other Child Care Tax Credit and Benefit Programs:
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To qualify for the medical expense tax credit, the medical expenses must have been paid or deemed to have been paid by either the individual or his or her legal representative for qualifying medical expenses as provided for in subsection 118.2(2) Furthermore, the medical expenses used in calculating a medical expense tax credit for a particular taxation year:
Please note that you should claim the total medical expenses for both you and your spouse or common-law partner on one tax return. You can claim the medical expenses on either spouse’s tax return. If both spouses have taxable income, it is usually better to claim the medical expenses on the return with the lower net income.
This is because the lesser of $1,925 (federal, for the year – see the tables of non-refundable tax credits for provincial/territorial amounts) or 3% of net income is deducted from the medical expenses to determine the amount to be used for the tax credit. However, if the lower income spouse does not have enough tax payable to offset the medical expense tax credit, it may be beneficial to move the expenses to the higher income spouse.
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For more information on these programs, see the Canada Revenue Agency (CRA) Child and Family Benefits web page.
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Starting with the taxation year, scholarship, bursary and fellowship income is fully exempt from tax when the income is received in connection with a program for which the student will get an Education Tax Credit. The income is not reported on the tax return.
If you are not eligible to claim the education tax credit, then only the first $500 of awards is tax free. Amounts received in excess of $500 are reported on line 130 of your tax return.
Prior to 2006, if you were eligible to claim the education amount, then the first $3,000 of scholarships, fellowships, bursaries, study grants and artists’ project grants were not taxable. Your T4A slips reported the total scholarships or awards. You totalled the T4A slips, then reported this total less $3,000 (or zero if your awards total less than $3,000) on the tax return.
The education amount tax credit can be claimed for each whole or part month in which you were enrolled in a qualifying program at a designated educational institution. The educational institution must provide either a T2202 Education and Textbook Amounts Certificate, or a T2202A Tuition, Education and Textbook Amounts Certificate. The certificate will show the number of months you were enrolled in a qualifying educational program or a specified educational program. The amount that can be claimed is $400 per month for full time enrollment, or $120 per month for part time enrollment.
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The Tuition Tax Credits for tuition, education amounts and textbooks are non-refundable tax credits. There is a Federal tax credit as well as a provincial or territorial tax credit for tuition, education and textbook amounts. For this reason, to claim these amounts, or to transfer them to another person, you must complete both the Federal Schedule 11 of your tax return, and the provincial S(11) schedule. Québec uses Schedule T for tuition or examination fees being claimed or carried forward.
To claim the tuition tax credit, you must have received from the educational institution either an official tax receipt or a completed form T2202A, Tuition, Education and Textbook Amounts Certificate. If you paid less than $100 for the year to any particular educational institution, that amount is not claimable. Otherwise, the total tuition fees paid in the year are claimable. The costs of books, room and board, or student association fees cannot be claimed. If the fees were paid by your employer or the employer of one of your parents, then the costs are not deductible unless the reimbursed amount is included in your income or your parent’s income. Private school tuition fees for elementary and secondary students are generally not tax deductible.
The textbooks tax credit is an additional tax credit starting in 2006, similar to the education tax credit, for textbooks. This non-refundable tax credit is based on $65/month for full-time attendance or $20/month for part-time attendance.
If you do not have enough income to utilize your total tuition costs, education amount or textbooks amount, you can either carry forward these amounts to future years (no limit to carry-forward period), or you can transfer the costs to your spouse, common law partner, or to a parent or grandparent of you or your spouse or common law partner. The maximum amount that can be transferred to a parent or grandparent is $5,000, less the costs claimed by the student. This may still result in costs remaining that can be carried forward. The transfer of costs to another person should not be more than can be utilized on their tax return. Then any excess costs can still be carried forward.
Once unused costs have been carried forward, they cannot be transferred to anyone in a future year.
]]>The federal budget introduced a non-refundable public transit tax credit based on the cost of monthly public transit passes for travel.
In addition to monthly public transit passes, the public transit tax credit has been expanded to include costs for:
For example, if your monthly transit pass costs $100, the amount you can claim in the Year would be $1,200, resulting in a tax credit of $180.00 (twelve months multiplied by 15%).
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Young people aged 17 and under who are registered in an approved organized sport, physical recreation, or physical activity program qualify for the tax credit.
However, as part of the newly expanded program for 2010, the Health Tax Credit or Healthy Living Tax Incentive will be extended to include all ages, encouraging adults and children to participate in a healthier lifestyle through fitness.
Adults and children enrolling with an eligible sport and recreation organization in 2010 must keep registration tax receipts to claim the health tax credit on their 2010 tax return. Only receipts from those sport and recreation groups who have registered with the Department of Health Promotion and Protection are eligible.
Receipts for health tax credit submitted with your 2010 taxes must be dated on or after January 1, 2010 for an adult to benefit from the newly expanded program and receive the credit.
Parents can still submit receipts for their children for the tax year
Please note that This is a tax credit not a tax rebate. A tax credit is a reduction against income tax. A person who claims the maximum of $500.00 can expect a tax reduction of $43.95. This amount will be deducted from your provincial income tax, much the same way your charitable donations are deducted.
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The Home Renovation Tax Credit is a temporary non-refundable tax credit that will only be avaliable for the 2009 tax year regarding home renovation expenditures between January 27, 2009, and before February 1, 2010.
The credit will only be available for the 2009 tax year and applies to eligible expenditures of more than $1,000, but not more than $10,000, resulting in a maximum credit of $1,350.
Please note what eligible home renovation expenditures incurred in relation to a renovation or alteration to an eligible dwelling (or the land that forms part of the eligible dwelling) must be of an enduring nature and integral to the dwelling, and includes the cost of labour and professional services, building materials, fixtures, rentals, and permits. Eligible expenditures must be supported by acceptable documentation.
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