Tax Tips from the Canada Revenue Agency

Benefits for Families (for links to more financial information see below)

Deductions

Parents may be able to deduct eligible child care expenses they incurred in 2008 for children who are under the age of 16, or who are dependent on them and have a mental or physical infirmity. For more information, and to make your claim, use Form T778, "Child Care Expenses Deduction for 2008".

Federal non-refundable tax credits:

Amount for children born in 1991 or later: You can claim $2,038 for each of your or your spouse's or common-law partner's children who were under the age of 18 at the end of the year and lived with you throughout 2008. For more details, see line 367 of the 2008 General Income Tax and Benefit Guide.

Children's fitness tax credit: Parents can claim, on line 365, fees paid to register their child in a prescribed program of physical activity, up to a maximum of $500 per child who is under 16 years of age at the beginning of the year in which the expenses are paid. If their 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. For more details, see line 365 of the 2008 General Income Tax and Benefit Guide.

Public transit pass credit: You can claim the cost of certain transit passes or electronic payment cards to travel by local ferries, buses, streetcars, subways, or commuter trains. For more details, see line 364 of the 2008 General Income Tax and Benefit Guide.

Benefits and Credits

Child benefits

Parents and caregivers can apply for the Canada Child Tax Benefit ("CCTB"), which is a non-taxable monthly payment for every child under the age of 18. The amount is calculated based on the number of children in their care, the province or territory of residence, and their 2008 family net income. Parents can also receive the Universal Child Care Benefit, which is a taxable guaranteed payment of $100 per month per child under the age of six.

In order to receive the benefit, parents must complete Form RC66, "Canada Child Benefits Application", or apply online using the "Apply for Child Benefits" service through "My Account". In addition to the CCTB, parents could receive the Child Disability Benefit if their child is eligible for the disability amount.

Goods and services tax/harmonized sales tax ("GST/HST") credit

Each year, you or your spouse or common-law partner can complete the application area on page 1 of your income tax and benefit return to receive the GST/HST credit. For more information on the GST/HST credit, go to www.cra.gc.ca/benefits, see Pamphlet RC4210, "GST/HST Credit", or call 1-800-959-1953.

Working Income Tax Benefit ("WITB")

Working individuals and families with low incomes may be able to claim the WITB when filing their income tax and benefit returns. The WITB includes a supplement for individuals who are entitled to the disability amount. Eligible individuals and families can also apply for advance payments of up to one half of their estimated 2009 WITB by completing Form RC201, "Working Income Tax Benefit Advance Payments Application for 2009".

Benefits for Seniors

There are a number of tax measures that may be of interest to Canadian seniors. To receive the GST/HST credit, you must apply by completing the application area on page 1 of your 2008 income tax and benefit return, even if you received the credit last year. For more information on the GST/HST credit, see Pamphlet RC4210, "GST/HST Credit", or go to www.cra.gc.ca/benefits.

To split your eligible pension income between you and your spouse or common-law partner in order to reduce the amount of taxes that you owe, both of you should complete Form T1032, "Joint Election to Split Pension Income". Be sure to keep the form in your records if you file electronically, or include it with your paper return. Go to www.cra.gc.ca/seniors for more detailed information.

You can contribute to your registered pension savings plan ("RRSP") up to December 31 of the year you turn 71 years of age (before 2007, this age limit was 69 years of age). Similarly, RRSPs and deferred profit sharing plans will generally be required to begin the payment of benefits to you by the end of the year during which you turn 71.

In November 2008, the minimum amount withdrawal from a registered retirement income fund ("RRIF") in 2008 was reduced by 25%. For more information about the RRIF, go to www.cra.gc.ca/seniors.


Federal Non-Refundable Tax Credits

Age amount: If you are 65 years of age or older and your net income for 2008 was less than $66,697, you can claim all or a portion of the age amount of $5,276. See line 301 of the 2008 General Income Tax and Benefit Guide for more information.
Disability amount: If a qualified practitioner certifies on Form T2201, "Disability Tax Credit Certificate", that you have a severe and prolonged impairment in a physical or mental function, you can claim the disability amount of $7,021. To learn more, see Guide RC4064, "Medical and Disability-Related Information".

Pension income amount: You may be able to claim up to $2,000, if you reported eligible pension, superannuation, or annuity payments on line 115, line 116, or line 129 of your return. For more information, see line 314 of the 2008 General Income
Tax and Benefit Guide.

Public transit amount: You can claim the cost of certain monthly transit passes or electronic payment cards used to travel by local ferries, buses, streetcars, subways, or trains. For more details, see line 364 of the 2008 General Income Tax and Benefit Guide.

Medical expenses: You may be able to claim the cost of medical expenses for any 12-month period ending in 2008 (provided that they have not been claimed before) for yourself, your spouse or common-law partner, or your dependants. For 2008, your total expenses have to be more than 3% of your net income or $1,962, whichever is less. For more information about medical expenses, including a list of common eligible expenses, CLICK HERE.

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