Money & Career

Essential tax deductions you might be overlooking

Essential tax deductions you might be overlooking

Author: Canadian Living

Money & Career

Essential tax deductions you might be overlooking

Many of us are overlooking some important tax deductions and credits that are easily overlooked if we’re not paying attention. This tax season, take the time to go over your paperwork thoroughly and see if there are any deductions that you may have missed.

Moving expenses

If you have moved at least 40 km to go to school or take on a new job, you might be able to claim the cost of your move. There are a variety of different moving expenses that are eligible to be claimed, such as transportation and storage costs, vehicle expenses, insurance for your household items, the cost of cancelling an apartment lease and the cost of meals and accommodation for up to 15 days.

Public transportation

For those who take the bus or train to work, make sure to save your passes and receipts throughout the year in order to claim the Transit Tax Credit. Note that this credit only applies to monthly passes and weekly passes (as long as four consecutive weekly passes are purchased), and will not work for single fare purchases or day passes.

Tuition fees and education expenses

In addition to claiming tuition and fees paid to a qualifying post-secondary institution, the Canadian government allows full-time students to claim $400 in education credits for every month of school ($140 for part-time students).

If you qualify to claim your tuition, you will also qualify to claim your textbooks at a rate of $65 for each month that you qualify for the education credit ($20 per month for part-time students). The credit is not dependent on how much you actually spend on your textbooks. Instead, it is a standard amount set for every student.

It is also good to keep in mind that if you’ve received a scholarship or bursary, the amount is exempt from tax, and does not need to be declared as income.

Safe-deposit box
If you use your safe-deposit box to store savings bonds, certificates or other investments, you can deduct the cost of renting it from your financial institution -- just ask for a receipt. If you are just using the safe deposit box for other reasons, such as to store jewelry or valuables, the cost will not be tax-deductible.

Medical expenses
If your employer doesn’t cover the full amount of your medical expenses, you are eligible to claim the remainder. Some of these costs might include medicine, dental fees, extra costs at the doctor's office, chiropractic treatment or laser eye surgery. You can only claim for expenses that you have actually paid for yourself. If your employer covers 90 per cent of all medical expenses, for example, you can only claim the remaining 10 per cent.

Keep in mind that your medical expenses for the year must exceed three per cent of your net income, or $2,052 -- whichever is less -- in order to be applicable. Therefore, if you have a spouse, it’s best to pool the expenses and claim it on the tax return of the person who has the lower income, so that the minimum will be exceeded quicker.

Take the time to do your research to see what small deductions you are missing every year. It can add up to a bigger tax refund, and more money in your pocket.

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Money & Career

Essential tax deductions you might be overlooking