It’s the time of year so many of us dread…TAX TIME. This is when I can be found updating spreadsheets, searching for receipts and generally in a state of chaos. If only I could get into a regime of keeping every little detail organized through the year, life would be much simpler at this time of year.
When I bring up the topic of taxes with my friends, the result is generally the same. We all become stressed and worried about monies we may owe without realizing it. Deep breaths friends, we get through this each and every year right? This year there’s actually been some changes which may result in some larger returns for Canadian families. This infographic from H&R Block Canada outlines it well.
Changes to the Universal Child Care Benefit: The Universal Child Care Benefit (UCCB) will increase to:
- $160 (from $100) monthly for each child under six
- $60 (from $0) monthly for each child between six and 18.
The increase for January to June will be paid in a lump sum in July 2015 and will then be paid monthly after that.
New Family Tax Cut: The Family Tax Cut is a form of income splitting and will allow a spouse to transfer “in kind” up to $50,000 of taxable income to a spouse in a lower income tax bracket.
Here is an example of how it would work.
- Spouse 1: Earns $50,000 per year – portion of income in excess of $43,593 taxed at 22
- Spouse 2: Earns $30,000 per year – entire income taxed at 15 percent
By splitting the higher income with the second spouse, the entire income $80,000 ($40,000 each) would be taxed at a rate of 15 percent. This would result in tax savings of $423. One of them can therefore claim a tax credit for this amount. The maximum credit is capped at $2,000 and in order to qualify the family must have a child under the age of 18 at the end of the year who must normally resides with them throughout the year.
Enhanced Children’s Fitness Tax Credit: The amount of expenses you can claim per child for the Children’s Fitness Tax Credit has increased from $500 to $1,000 and is retroactive to 2014. This increased credit is worth $75. Be sure to save all of your receipts for everything from swimming lessons to martial artists and then claim up to $1,000 on your taxes.
Aside from the credits for families with kids, there is another new tax credit announced for 2015. If anyone in your family is a search and rescue volunteer and puts in 200 hours or more of work can now claim a new Search and Rescue Credit. They can claim a personal amount of $3,000, which means $450 tax savings.
H&R Block Canada GIVEAWAY
The fine folks at H&R Block Canada have provided me with ONE gift certificate to give away to a lucky Canadian reader. The gift certificate is good for one regular return (T4) that can be used at a retail H&R Block location. Value: approx. $100. Enter by filling in the Giveaway Tools form below, ends March 3rd.