With winter's worst (hopefully) behind us, tax season is here, and there are many changes that families will want to be aware of.
Tax time is never fun, but it's even worse when you miss out on credits or deductions you may have qualified for. Complicating matters this year are several taxation changes due to a Liberal overhaul of several Harper-era measures.
"I've seen more changes this year than in the past three years," says Lisa Gittens, a tax expert at H&R Block.
Here are eight things families will want to be aware of when filling out their 2016 return.
1. Last chance on certain tax credits
The government is phasing out a handful of tax credits and focusing on larger benefits. The children's arts and fitness tax credits will be halved for the 2016 tax year, and cut completely next year, meaning families will no longer be able to defray costs for things like swimming lessons, ballet and tutoring. For post-secondary students, the education and textbook credits are being eliminated in 2017, although education amounts carried forward from previous years will still be claimable.
2. No more income splitting
Also gone is the Family Tax Cut, which lets the higher-earning spouse transfer up to $50,000 of income to the lower-earner. During the 2015 election, the Liberals promised to cut it, calling it a "tax break for the wealthy."
With the benefit gone, Gittens recommends a spousal RRSP, which allows the higher-earner to contribute to the lower-earning spouse's RRSP and claim the tax benefit. "You may have an RRSP set up, but you haven't thought about setting it up for your spouse. This is an ideal time to use that strategy," she says.
3. Changes to child benefits
The Canada Child Benefit was a signature feature of the 2016 budget, replacing the old Universal Child Care Benefit and the Canada Child Tax Benefit. It's non-taxable, so you don't have to claim it. However, in order to continue to receive the benefit, both parents must file a return, even if one doesn't generate any income, says Gittens.
Also keep in mind that the benefit started in July, so you still have to claim the taxable UCC for the first six months of the year.
4. New tax rates
New tax rates mean you may or may not be pleasantly surprised by the size of your tax bill this year. If you're in the meaty middle that earns between $45,000 and $90,000, your rate will come down to 20.5 percent from 22 percent.
"Most Canadians will be receiving more money at the end of the day than they were under the old system," says Jamie Golombek, managing director of tax and estate planning at CIBC Wealth Strategies Group.
However, high-income earners will be paying more due to a new 33 percent bracket for people earnings more than $200,000.
5. Child care expenses
Childcare costs are usually the biggest deduction available for families, says Golombek. But what many people don't realize is that it goes beyond simply daycare. If you have a nanny, you can claim that expense, but also babysitting, if it's during the day, and summer or day camp.
6. Disability tax credit and family caregiver amount
If you have family members with a disability there are certain credits that may be available to you. The Disability Tax Credit is available to people with disabilities to reduce their taxes. For children under age 18, a parent or caregiver may be able to claim the unused amount.
If you're a caregiver to a family member with physical or mental impairments, you may also be able to claim an additional $2,121, according to the Canada Revenue Agency.
7. Selling your principal residence
Selling your home has typically not been something you've had to report on your taxes, because usually Canadians don't get taxed for capital gains on their principle residence. But starting with the 2016 tax year, individuals who sold their principal residence during the year must report the sale. The government is ostensibly doing this to crack down on people who try to pass off income-generating homes as their principal residence.
8. eFile early, get your refund early
Tax deadline is April 30, but if you want to get ahead of the game, file early, before the government is inundated with last-minute returns. You can still file the old paper return, but Gittens says you'll be looking at a turnaround time of anywhere up to eight weeks, versus 10-14 days for a return filed early and electronically.
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Our editors share their best life tips.
Science says you should spend more time socializing. For more than 75 years, researchers at Harvard University have been studying what makes us happy and, according to current project director Robert Waldinger, strong social connections are the number-one predictor. "Good relationships keep us happier and healthier. Period," he said in a 2015 TED Talk.
Save the day
Everyone knows about the pay-yourself- first rule, but when you're staring down a stack of bills, saving can easily drop off your radar. So take yourself out of the equation entirely. Talk to your bank about setting up a TFSA, or a regular preauthorized transfer from your chequing to your savings account, and soon you'll be watching your money grow. And don't forget to check in once a year to see if you can afford to up the amount you're tucking away, even by a few dollars.
If life feels too full and noisy, try a no-gadget night once a week. Switch off all electronics, turn down the lights, enjoy relaxing activities and fall asleep earlier. Take it to the next level with no talking! — Jo Bennett, life coach
Don't go to bed angry
No, really—don't. According to a 2016 study, going to sleep while angry might reinforce negative memories, making it harder to get over the things that made you mad.
Looking to get ahead at work? It may not be enough to just tell your boss. Research by Catalyst, a nonprofit that promotes inclusive workplaces, says we should get comfortable talking about our accomplishments instead. The study found that women who clearly articulated career wins, "advanced further, increased their compensation growth and were more satisfied with their careers."
Tools of the trade
Three must-have smartphone apps that make life better, easier or just more fun.
1. Flipp (free, iOS and Android): The high-tech version of coupon clipping, use this app to price match, redeem coupons or see who has chicken on sale.
2. Field trip (free, iOS and Android): Discover hidden gems as you walk through any city—the app sends restaurant referrals, trivia and shopping tips based on proximity.
3. Downcast ($4, iOS): If you've been meaning to get into podcasts, check out this highly rated app. Search for interesting podcasts, download them to listen later and catch up on back episodes.