Personal finance tips for you and your family

This story was originally titled "Tax Tips for Canadian Families" in the February 2009 issue. Subscribe to Canadian Living today and never miss an issue!

Doug Morgan, a franchise owner of H&R Block Canada, offers seven tax-time tips every parent should know:

1. As soon as a child is born, fill out Canada Revenue Agency Form RC66 and send it in. That will register the child for eligible tax credits, such as the $100 monthly Universal Child Care Benefit, which is available for every child under the age of six and helps cover the cost of child care.

2. Whatever your income, you can claim the $2,038 Child Tax Benefit for each child under 18. In 2008, this translated into about $305 in tax savings.

3. The $500 non-refundable Children’s Fitness Tax Credit helps pay for programs promoting physical activity for kids under 16. There are guidelines for qualifying activities, and you will need to keep all of your receipts.

4. Residents of Nova Scotia, Manitoba and the Yukon can claim an additional provincial child fitness credit for qualifying programs.

5. Children under 18 with disabilities are eligible for a $1,000 fitness credit to help with the additional costs of having them participate in an activity.

6. You can now contribute up to $50,000 for each child to a registered education savings plan (RESP) with no annual contribution limits.

7. The Canada Education Savings Grant program makes matching payments to RESPs of up to $2,500 per year.

Hassle-free tax returns
Sometimes you want to stay out of the spotlight, especially when it comes to the Canada Revenue Agency. Deloitte and Touche LLP, a professional services firm in Canada, compiled a list of items most likely to be questioned on tax returns. The list relates to personal income tax matters, but the requests are not specific to personal tax busy season (generally the month of April):

• RRSP over-contributions;
• Carrying charges, which include interest on funds borrowed to earn investment income and investment counsel fees;
• Capital gains and losses;
• Charitable donations;
• Moving expenses;
• Insufficient or late quarterly tax instalments;
• Arrears interest on taxes owed;
• Medical expenses and disability claims;
• Tax-shelter claims; and
• Unreported income.

Call for help
Struggling with your finances? A quick call to Credit Counselling Canada (CCC) can help. A not-for-profit organization established in 2000, CCC provides Canadians with advice on all personal financial needs, whether you have a quick question about credit card interest rates, or need help with a long-term budget to pull yourself out of debt. CCC offers over-the-phone and in-person counselling. Visit its website to find an office near you.

Page 1 of 1

Read more:
• How to get a fresh start on your finances
• From high school to higher learning
• Kids and money