Nothing makes filing taxes more painful than being unprepared. The mad dash to collect documents and fill out forms often leaves most of us scrambling to do our taxes (or paying someone else to do them for us) at the very last minute.
Between trying to stay organized, worrying about whether or not we included everything necessary, and trying to remember where we stashed 12 months' worth of receipts, many of us end up missing important tax credits and deductions that could actually get us more money back on our tax returns.
To ensure you get the money you deserve this tax season, we've assembled some of the eligible tax credits and deductions you may not have realized you can take advantage of. There are literally hundreds available to Canadians, so it can be easy to miss a few. If you want to make the most out of your tax return this year, make sure you haven't overlooked any of these tax credits and deductions.
1. Medical expenses
Most Canadians claim medical expenses for prescriptions, dental bills, and eyeglasses, but did you know things like an air conditioner, therapy animals, and gluten-free products can all qualify as a medical expense under the right conditions?
If you have been officially diagnosed with celiac disease, you can claim the difference in cost between your expensive gluten-free products that you buy every week, and the cheaper non-GF alternatives. For example, if you purchase gluten-free bread for $6.99 and traditional bread costs $3.49, you'll be able to claim the difference: $3.50. That means if you buy gluten-free bread every week (52 times in one year), you're eligible to claim the total incremental difference ($3.50 x 52): $182!
2. Charitable donations
Giving back can actually put money in your pocket. When you donate to an eligible charity, you're entitled to a tax credit equal to 15% of the first $200 you donate and a tax credit of 29% of the remainder. The exact amount will depend on how much you donated during the year, which province you're in, and what year you're applying for.
If you really want to maximize your donations' impact on your return, the CRA lets you hold on to your donation amounts for up to five years and claim them all on a single return.
3. First-time home buyer
Have you recently bought your first home? Congratulations! You're entitled to a sizeable tax credit. As long as you haven’t lived in a home owned by you or your spouse in the last four years, you can get up to $750 back from the government for purchasing a qualifying home in Canada during the tax year. Go ahead and use that money to refurbish your new master bedroom!
4. Moving expenses
If you've recently moved to start a new job or attend a post-secondary school to study as a full-time student, you might be able to claim the money you used to move (within reason, of course). You can claim back the cost of renting a moving truck, hiring movers, and even the amount you paid to buy your new home (like legal or notary fees) or to maintain your old home while you try to sell it.
5. Interest on student loans
Paying off your student loans sucks, but getting money back for paying them doesn't. Depending on the amount of your student loans and how much you paid towards them during the tax year, you can add a pretty significant amount to your tax return. Note that this non-refundable credit applies only to interest paid on eligible loans — not all loans qualify, like student lines of credit.
6. Union dues
If your job requires you to be a member of a union and you pay union dues towards that, be sure to claim this on your tax return. Most union dues are deducted directly from your paycheque and appear on your T4.
7. Childcare expenses
If you pay for childcare so that you can work or attend school, you're already aware that childcare expenses like daycare are deductible. But did you know that other expenses like overnight camps and summer camps also qualify? The basic limit for childcare expenses for eligible children under the age of seven is $8,000.
8. Home-Office Expenses
Whether you're self-employed or have a full-time job and earn self-employed income on the side, there is a range of business expenses you're allowed to deduct. These expenses are necessary to lower your income and reduce the taxes you owe, so don't shy away from claiming them! You can claim everything from vehicle and travel-related expenses to rent and cleaning supplies for your home office.
With April 30 nearly upon us, make sure you’re up to speed on any credits you may be able to claim. Keep yourself prepared by keeping track of your expenses all in one place with Paytm Canada.
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