CANADA’s TOP FIVE (5) TAX BENEFITS
I. CANADA CHILD BENEFIT (CCB)
The Canada child benefit (CCB) is a tax-free monthly payment made to eligible families to help with the cost of raising children under 18 years of age.
Who can apply?
You must meet ALL of the following conditions:
You live with a child who is under 18 years of age
You are primarily responsible for the care and upbringing of the child
You are a resident of Canada for tax purposes
You or your spouse or common-law partner must be any of the following:
a Canadian citizen
a permanent resident
a protected person
a temporary resident who has lived in Canada for the previous 18 months, and who has a valid permit in the 19th month
an Indigenous person who meets the definition of "Indian" under the Indian Act
Who is primarily responsible for the care of the child?
The person who is primarily responsible for the care and upbringing of the child should apply for the CCB. That person is responsible for things such as:
supervising the child’s daily activities and needs
making sure the child’s medical needs are met
arranging for child care when necessary
Custody arrangements and your benefits
If a child only lives with you part time, you need to determine if you are considered to have shared custody.
Determine if you have shared custody
Does the child spend their time:
about equally between both parents
mostly with you
mostly with the other parent
mostly with the other parent, but for a temporary period, mostly with you
If you start or end a shared custody situation, let the CRA know that your situation changed.
When to apply?
You should apply for the Canada child benefit (CCB) as soon as any of the following situations happen:
your child is born
a child starts to live with you, or returns to live with you after a temporary period with someone else
you begin, end, or change a shared custody arrangement
you get custody of a child
you, or your spouse or common-law partner, start to meet the eligibility conditions under Who can apply
If the child started living with you more than 11 months ago, you will need to provide additional documents.
You don't need to apply separately for related provincial and territorial programs. The CRA will determine your eligibility when you apply for the CCB.
How to apply?
You can apply for the CCB when you register the birth of your newborn. In most cases, registration is done by paper at the hospital or birthing centre. Residents of Ontario, Quebec and British Columbia also have the option to register online.
Why do I need to register my child's birth?
The birth of every child born in Ontario must be registered and submitted to the Office of the Registrar General within 30 days following the birth. Using the 5-in-1 Newborn Registration Service, you can register a child's birth, order your child's first birth certificate, apply for Canada Child Benefits and Social Insurance Number (SIN), and apply for an Education Savings Referral.Bottom of Form
If you didn't apply for the CCB when you registered the birth of your newborn, you can apply online using My Account (your personal CRA account) or by mail
How much you can get?
Every July, your benefit payment is recalculated based on your adjusted family net income from the previous year, indexed to inflation.
For example, payments from:
July 2020 to June 2021: based on your adjusted family net income from 2019
In other words, a change in your income in 2019 will only be reflected in your payments starting in July 2020.
Payment will stop if you DON’T file your tax return
To keep getting your Canada child benefit (CCB) and related provincial and territorial payments, you must file your tax return on time every year. If you have a spouse or common-law partner, they also have to file their tax return on time every year.
You must file your tax return even if your income is tax exempt or you have no income.
If you don't file your tax return every year, your payments will stop.
Your CCB payment is not taxable. This means that you will not receive a slip, and you don't have to report it on your tax return.
II. GOODS AND SERVICES TAX ⁄ HARMONIZED SALES TAX (GST/HST) CREDIT
The goods and services tax/harmonized sales tax (GST/HST) credit is a tax-free quarterly payment that helps individuals and families with low and modest incomes offset all or part of the GST or HST that they pay.
Eligibility
You are generally eligible for the GST/HST credit if you are considered a Canadian resident for income tax purposes the month before and at the beginning of the month in which the Canada Revenue Agency makes a payment. You also need to meet ONE of the following criteria:
you are at least 19 years old
you have (or had) a spouse or common-law partner
you are (or were) a parent and live (or lived) with your child
In most cases, all you have to do to receive the GST/HST credit each year is file your taxes, even if you have no income to report.
Payment dates
The Canada Revenue Agency usually send the GST/HST credit payments on the fifth day of July, October, January, and April.
Turning 19
If you have filed your tax return and you are entitled to the GST/HST credit, the CRA will issue your first payment on the payment date that comes after your 19th birthday.
III. CANADA WORKERS BENEFIT
The 2018 federal budget introduced the Canada workers benefit to strengthen and replace the working income tax benefit (WITB). The Canada workers benefit (CWB) is a refundable tax credit that provides tax relief for eligible low-income individuals and families who are in the workforce.
Eligibility
To be eligible for the Canada workers benefit (CWB), you must be:
a resident of Canada for income tax purposes throughout the year
19 years of age or older on December 31
unless, on December 31, you have a spouse or common-law partner, or an eligible dependant*
You are NOT eligible for the CWB if:
You are enrolled as a full-time student at a designated educational institution for more than 13 weeks in the year
unless, on December 31, you have an eligible dependant*
You are confined to a prison or similar institution for a period of 90 days or more in the year
You do not have to pay tax in Canada, because you are an officer or servant of another country, such as a diplomat, or you are a family member or employee of such person
How to apply?
To apply for the Canada workers benefit, you must:
1. Complete Schedule 6, Canada workers benefit
2. Enter on line 45300 of your income tax and benefit return the amount from line 42 of Schedule 6
3. Send (file) your return to the Canada Revenue Agency (CRA)
If you prepare your return on paper, include your completed Schedule 6, Canada workers benefit, with your return
How much you can expect to receive?
The maximum payment you can expect to receive from the Canada workers benefit (CWB) is dependent on the province you live in.
Maximum payment for the Canada Workers Benefit (CWB)
$1,355 for single individuals The Canada workers benefit (CWB) payment is gradually reduced when net income is more than $12,820. No CWB is paid when net income is more than $24,111.
$2,335 for families The CWB payment is gradually reduced when family net income is more than $17,025. No CWB is paid when the family net income is more than $36,483.
IV. THE CLIMATE ACTION INCENTIVE (CAI)
The climate action incentive (CAI) payment consists of a basic amount and a 10% supplement for residents of small and rural communities. This payment may reduce your amount payable or increase your refund when you file your income tax and benefit return.
Eligibility
You CAN claim the CAI if ANY of the following applies to you:
December 31, 2019, you were a resident of Ontario and you met any of the following conditions:
• you were 18 years of age or older
• you had a spouse or a common-law partner
• you were a parent who lived with your child
Eligible spouse or common-law partner
For the purpose of the CAI, an eligible spouse or common-law partner is a person who meets ALL of the following conditions:
• was your spouse or common-law partner on December 31, 2019
• was a resident of Canada throughout 2019
• was not confined to a prison or a similar institution for a period of at least 90 days during 2019
• was not exempt from income tax in Canada at any time in 2019 because they were an officer or servant of the government
of another country, such as a diplomat, or a family member who resided with such a person, or an employee of such a
person
• was not a person for whom a CSA was payable at any time in 2019
• did not die before April 1, 2020
Notes: Either you or your spouse or common-law partner may claim the CAI for the family, but not both of you.
Qualified Dependant
For the purpose of the CAI, a qualified dependant is a person who meets ALL of the following conditions:
• was your cohabiting spouse's or your common-law partner's child or a person dependent on either one of you for support
on December 31, 2019
• resided with you on December 31, 2019
• was under 18 years of age on December 31, 2019
• was a resident of Canada throughout 2019
• was not married or living with a common-law partner on December 31, 2019
• was not a parent who lived with their child on December 31, 2019
• was not confined to a prison or a similar institution for a period of at least 90 days during 2019
• was not exempt from income tax in Canada at any time in 2019 because they were an officer or servant of the government of
another country, such as a diplomat or a family member who resided with such a person, or an employee of such a person
• was not a person for whom a CSA was payable at any time in 2019
• did not die before April 1, 2020
You CANNOT claim the CAI if ANY of the following applies to you:
• you were a non-resident of Canada at any time in 2019
• you were confined to a prison or a similar institution for a period of at least 90 days during 2019
• you were exempt from income tax in Canada at any time in 2019 because you were an officer or servant of the government of
another country, such as a diplomat, or a family member who resided with such a person, or an employee of such a person
• you were a person for whom a children's special allowance (CSA) was payable at any time in 2019
V. CANADA TRAINING CREDIT LIMIT
As of January 1, 2019, if you meet certain conditions, you will be able to accumulate $250 per year, to a maximum over your lifetime of $5,000
A new refundable tax credit will be available for 2020 and future years. Based on information from your return, the CRA will determine your Canada Training Credit Limit for the 2020 tax year and provide it to you on your Notice of Assessment for 2019.
For 2020 and future years, you may be able to claim a Canada Training Credit equal to your Canada Training Credit Limit for the year or 50% of your eligible tuition and fees paid to an educational institution in Canada, whichever is less.
CONTACT US:
If you have any questions or inquiries regarding Canada's Tax Benefits, you can contact us at 647-861-2099 or send email to info@globalabcservices.com
