Canadian Personal Finance Blog

Archive for the ‘Child Tax Credit’ Category

Since I am doing my taxes here are some other important deductions you should remember (if they apply to you, of course) .

Transit Pass Credit

Remember if you take the bus (or your kids do), you can use the Public Transit Tax Credit . Remember if your kids use a bus pass the following as well:

Yes, you can claim the tax credit for public transit passes on behalf of your spouse, common law partner, and your children under the age of 19, to the extent that these amounts have not already been claimed.

So the expense is transferable as well, useful to know that one.

Education

Having a child in University means I can claim her tuition on my taxes, which is not a bad thing. Since this is the first year for me with this, it is important to get all the forms done right, so please read over the web page and such and make sure the student involved fills in all the forms to allow for the transfer of these credits to you. I am still muddling through this one and will keep you posted on my progress. 

The maximum tuition, education, and textbook amount transferred from a child (or fromeach child), is $5,000 minus the amounts that he or she uses, even if there is still an unclaimed part. Tuition, education, and textbook amounts that the student carried forward from a previous year cannot be transferred.

So $5000 max per child is another important point to remember. This is where the High Price of University comes back to help you a little.

Charitable Donations

Now is the time to rummage through your papers to find ALL the receipts that you so carefully stored away when they arrived (yes I am being sarcastic, about myself, I may one day take a picture of my home “work space” to show you just how cluttered and disorganized it is). Each one of these receipts is money back in your pocket, so make sure you find them all. 

I have a cross-reference method, since I use Quicken, I check in Quicken for my Charitable expenses and then go and hunt down the receipt (or send the charity a note asking for a duplicate).

Also make sure this is a valid charity, you can go on the CRA site to see which charities have had their Charity designations revoked.

Manual or Computer?

This is an interesting question I ask folks and sometimes get an interesting answer. I have been using various computer software to do my taxes ever since it was possible (I have a Math degree, not an Arithmetic degree), but I do know that Michael James on Money enjoys doing his taxes manually using forms and pencil.

Does anybody else use pencil and paper still? Do you use a service to make up  your taxes, and if so why? My taxes this year are going to be confusing, but still not complicated enough that I would pay to have someone else do it, but that may change in the future.

As an update, I submitted my taxes on the 15th and I got my refund on March 20th, so that is quite the speedy response. I did e-file, which I think speeds up the process, but I thought because I had waited a little later I might not get that quick a response, but in fact, I got the expected refund as did my wife and my daughter, so the taxes for last year are now closed.

The major helper for my larger than average refund were:

1. Mass transit bus pass refund
2. Donations to my Church
3. Active Child tax credit

Since those are really my only non-standard tax deductions (oh and my safety deposit box for investing). I should actually adjust my tax deduction schedule so that I don’t get such a large refund (and instead get the money back during the year), but every year things change so I like to carry a certain amount of “cushion” in case I have unexpected income (like my wife working part time or a sudden win-fall from my financial blogging ).

As a point of information I used Quicktax platinum again this year, mostly out of laziness and they had a package where I got a new copy of Quicken a Quicktax Platinum for about $100, which fit my purposes. I am not endorsing or slagging Quicktax, it worked fine for me, but I would guess other programs might have worked fine as well. I have a very “vanilla” tax return these days (don’t think I really needed the Platinum either).

End of Quarter

Yes this week is that last week of this financial quarter, so I will need to put together an updated financial statement for my wife. It is always interesting and useful to do this for me, just to see where I have made progress and areas where I need to keep working hard.

Time to also look at starting a new financial plan, given my Lenten plan didn’t quite work as hoped, but that is why pencils have erasers, mistakes happen. Start a new plan and see if this is the one that maybe gets you back on track.

So after my posting about the cost of raising kids a while back a lot of folks pointed out the costs of daycare and how this is prohibitive for dual income families. To those who were so vociferous in your commentary about how I had missed the point, please watch the following video which I think puts forth a viable alternative to the high costs of daycare.

Report: Many U.S. Parents Outsourcing Child Care Overseas

Many thanks to John Chow for pointing this one out.

Related Links:

• My Spouse is Worth How Much: Scenario
• The Disappearing Middle Class in Canada

That was the response I got from more than one person I spoke with about the new child tax credit. They lamented how it wasn’t very much money, and why should they be bothered getting the tax removed at the source (and just wait for it as a nice rebate in March of next year). If you agree with that, I’d like to point out:

1. To me with 4 kids it is actually $40 so per pay cheque, which I view as significant, maybe I am funny that way.
2. Why do you want to loan the government more money (at 0% interest)? If you want to do that just put the money in your chequing account.
3. If you think $10 is no big deal, send me $10 every two weeks, I’ll figure out what to do with it.

It’s always interesting to see how folks are so intense about saving hundreds of dollars in a few areas, but saving $10 in a lot of places, just doesn’t interest them? I can’t be bothered to get an extra couple of bucks? The amount of work I had to do was fill in a form and e-mail it to my HR group, and that was it. Interesting how people value money.

Related Links

• Child Tax Credit
• My Wife is Worth How Much

So I had completely forgotten about the new child tax credit in the last budget, that started on July 1st, but thanks to our friends at Canadian Capitalist he mentioned in This and That about how the program started already. Thanks to his reminder, I found out that my employer needed me to send them an updated Tax form, so I missed out on this pay cheque but should be OK for my next one. I believe I owe him a beer!

The new Credit gives me $2000 per child under the age of 18, and in my house that adds up to $8000, which is just a little less than what I get as a tax credit for being married, but, I am not complaining, I take all tax breaks with a smile! More money in my pocket now, is better than any tax refund I get in March next year as well (hence why I am making sure that my employer adjusts my tax deductions at the source).

The Stats Canada census review point out that more and more people are living much longer which means, we should all be planning to have a much longer retirement. For those with pensions, that isn’t as big a worry, but for those with RRSP savings and such, you might want to recalculate on the assumption that you are going to live past age 80

The 2006 Census enumerated 1,167,310 people aged 80 years and over, up 25% from 2001, the second fastest increase of all age groups. This age group accounted for 26.9% of all seniors in 2006, up from 24.0% in 2001 and only 14.6% in 1956.

You are going to need a little more money, so plan accordingly folks.