April showers bring May flowers – and the tax deadline. Believe it or not, the deadline for filing your 2014 tax return is less than 90 days away. If this deadline is already weighing you down, you’re not alone. Let’s face it, not many Canadians get excited about tax season. But there is good news, Canadians!
This year there are new tax credits for Canadian families that may help put a few dollars back into your wallet. Caroline Battista, senior tax analyst with H&R Block Canada, provides insight into these new credits and who can benefit from them.
The New Family Tax Cut – designed as a limited form of income splitting, it allows qualifying families to save when one spouse earns considerably more than the other. Families with children under the age of 18 will be able to claim a non-refundable tax credit equal to the amount of tax savings that would be realized by transferring up to $50,000 worth of income from the higher-earning to the lower-earning spouse or common-law partner. “This will generally be beneficial if one spouse is in a higher tax bracket than the other or if the lower-income spouse has non-refundable tax credits that are not being fully utilized,” explains Battista. The tax credit will be capped at a maximum of $2,000.
Similar to the rules for claiming the child amount, a family must have a child under the age of 18 at the end of the year who must normally reside with them throughout the year. An exception to this rule would be if the parents of a child remarry or enter into new common-law partnerships during the year, or if a child is born, adopted or passes away during the year.
Increase to the Children’s Fitness Tax Credit – If you have children involved in after school sports or athletic programs, the government increased the Children’s Fitness Tax Credit to $1,000 and made it retroactive for 2014. Parents should claim the receipts in the year they paid – not the year the activity takes place.
Universal Child Care Benefit – Though the Universal Child Care Benefit doesn’t show up in your tax refund, parents with children under 18 will start to see an increased benefit in July 2015. For children under six, the monthly amount will be $160 (up from $100) and for children between six and 18, it will be $60 a month. The increase for January to June will be paid in a lump sum in July 2015. And then parents can expect the increased amounts to arrive monthly after that. If you haven’t already registered for child benefits, use Form RC66.
Each tax credit you can utilize can reduce your tax bill, and they can add up. Battista encourages you to know what credits you are eligible for and have all of the necessary forms and paperwork in order so you don’t miss a thing.
If the idea of doing your own tax return sounds like a daunting task, visit a local H&R Block office where a professional can assist you in every step.
WIN IT: One Canadian will get a certificate for one regular return (T4) that can be used at any H&R Block retail office location in Canada, ARV $100.
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This is a sponsored post yet, as always, my opinions are 100% my own.