Economic Planning Board Tuesday, April 19, 2016 Canada
Child Tax Credits
Children have an under-estimated impact on taxes. They are useful for tax savings when filing your personal returns. Get credit for being a parent! Here are some tips to save on tax if you have children for 2015.
Universal Child Care Benefit is available for children aged six through seventeen. You will receive $1,920 annually (paid monthly) for each child under the age of six and $720 annually for each child aged six through seventeen. This enhanced amount has replaced the child tax credit from previous years. If you did not receive this payment – call CRA. As at July 1, 2016 this will be replaced with the Canada Child Benefit. With the new benefit, households with income of less than $30,000 will receive a maximum of $6,400 per child under age six and $5,400 per child between six and seventeen. The benefit will be scaled down based on family income and the number of children in the family.
The Family Tax Cut continues to be made available for 2015. For couples with children under the age of 18 - higher income spouses can transfer up to $50,000 of taxable income to lower income spouses for up to $2,000 in tax savings. This income-splitting measure will not be available in 2016.
Children’s Fitness Tax Credit is now $1,000 per child and provides a refundable credit of 15% based on the amount spent on eligible fitness activities for children under the age of sixteen. This credit will be phased out by 2017 and only have the amounts available for 2016.
Children’s Arts Credit is $500 per child for programs of artistic, cultural, recreational or development activities. This is a 15% non-refundable credit based on the amount spent. This credit will be phased out by 2017 and only have the amounts available for 2016.
Child Care Expenses can generally be deducted by the lower income spouse to a maximum of $8,000 for children under age seven and $5,000 for children aged seven through sixteen.
Credit for Transit Passes for children under the age of 19 can be claimed by either parent.
Tuition, education and textbook credits are available for post-secondary students. This includes the tuition amount plus an additional amount for full time students of $400 per month of enrolment plus $65 per month for textbooks. Part time students can claim the additional amount at $120 for each month of enrolment and $20 per month for textbooks. Credits not claimed by your child can be transferred to yourself, your spouse or their grandparents. Unused credits can be carried forward. The Education and Textbook Tax Credits will be eliminated as at January 1, 2017. Unused credits will still be allotted to be carried forward.
