Tax season can be a stressful time for Canadians, but it’s also an opportunity to take advantage of tax credits and deductions that can save you money. Here are some of the top tax credits and deductions for Canadians to consider:
Basic Personal Amount: This is a non-refundable tax credit that all Canadians are entitled to, which essentially means you can earn a certain amount of income tax-free. The basic personal amount for 2022 is $13,808.
Canada Child Benefit: If you have children under the age of 18, you may be eligible for the Canada Child Benefit (CCB). The CCB is a tax-free monthly payment that helps cover the cost of raising children. The amount you receive depends on factors such as your income and the number of children you have.
Medical Expenses: Canadians can claim eligible medical expenses as a tax credit. This includes things like prescription medication, dental and vision care, and medical devices. You can claim medical expenses for yourself, your spouse or common-law partner, and your dependent children.
Charitable Donations: If you made charitable donations in the past year, you can claim them as a tax credit. The federal charitable donation tax credit is 15% on the first $200 donated, and 29% on any amount above that.
Home Accessibility Tax Credit: If you or someone in your household has a disability, you may be eligible for the Home Accessibility Tax Credit (HATC). The HATC is a non-refundable tax credit that covers expenses related to making your home more accessible, such as installing wheelchair ramps or grab bars in the bathroom.
Public Transit Tax Credit: While this credit was eliminated in 2017, it is still available for eligible expenses incurred before July 1, 2017. If you took public transit to and from work, school, or other activities, you can claim the cost of your transit passes as a tax credit.
Tuition and Education Credits: If you’re a student, you may be eligible for tuition and education tax credits. These credits can be claimed for tuition fees, textbooks, and other education-related expenses. You can also transfer unused credits to a spouse or parent.
RRSP Contributions: Contributions to a Registered Retirement Savings Plan (RRSP) can be claimed as a tax deduction. This can help reduce your taxable income and increase your refund. The amount you can contribute depends on your income and your available contribution room.
Employment Expenses: If you incurred expenses related to your job that were not reimbursed by your employer, you may be able to claim them as a tax deduction. This includes things like home office expenses, travel expenses, and supplies.
First-Time Home Buyer’s Tax Credit: If you purchased your first home in the past year, you may be eligible for the First-Time Home Buyer’s Tax Credit (HBTC). This is a non-refundable tax credit of up to $5,000 that can help offset some of the costs of buying your first home.
In conclusion, there are a variety of tax credits and deductions available to Canadians that can help reduce their tax burden. It’s important to keep track of eligible expenses throughout the year and consult with a tax professional to ensure you’re taking advantage of all the credits and deductions available to you.
