When you think about it, raising a family in Ottawa, and everywhere else on the planet, it is highly rewarding and expensive. The costs begin with daycare, and extracurricular programs, sports, music, art, and others too numerous to mention. Nevertheless, as parents you begin to look for areas where you can save money to benefit the whole family as well as the return you may get come tax time.
This annual ritual of paying taxes becomes an exercise in trying to minimize the amount of you have to pay, which means that you should be able to get something back from all the money taken, as taxes, from your earnings throughout the year.
As a parent, you can understand that even the smallest amount saved is a big help. What follows are some areas that are viable tax credits and tips that every parent needs to know and understand come tax time.
The Tax Credit for Children
In Ottawa, as well as the rest of Canada, the Canada Child Tax benefit, (CCTB), is designed to aid low to middle income families meet the needs of their family and lowering the burden on their annual earnings, (below $43,541.00). This done through a monthly tax-free benefit they receive. In order to qualify, the parents need to apply for this benefit at tax time for the following year. Additionally, the CCTB is a provincial benefit combined with a National Child Benefit Supplement, (NCBS), and the Universal Child Care Benefit, (UCCB).
The Canada Child Tax Benefit
This is a non-taxable income received during a 12 month fiscal period, July to June. The CRA bases the amount received for the annual single or combined earnings of the wage earners in an Ottawa household, married and common law partners. Families who receive these benefits do so until the child turns eighteen years old. However, the benefits adjust for the amount of children in a given household.
$2,241.00 for a single child
$1,981.92 for a second
$1,885.92 for each additional
Any Ottawa resident on social assistance will receive a reduced amount as will families earning over $25,584.
The National Child Benefit Supplement
In certain cases, families who receive the NCBS, and the CCTB, are eligible to receive a Canada Learning Bond, (CLB), and an additional supplement until the child reaches 15 years of age. This is a total of $600 extra, $500, and $100 respectively.
The Universal Child Care Benefit
The UCCB goes out to families with eligible children, regardless of income. What makes a child eligible is their age. This is a $100 monthly supplement for children under the age of six years old. The important thing to remember is that this benefit is taxable to the person, the spouse, or common law partner, who earns the least for the household. However, this credit is not accountable with other taxable benefits.
Benefits for Children in Shared Custody
Parents who share custody of their children here in Ottawa are eligible to receive both the CCTB and the UCCB. Stipulation for this is the child lives equal amounts of time with each parent. If not, then the parent who the child lives with for most of a given year will receive the benefits.
Tip: Being Prepared is Important
As Parents, living in Ottawa, there are always avenues to take to save money for retirement, paying for your children’s college, mortgage, rent and so on and so forth. Additionally, as parents you do not enjoy seeing your hard earned money taken at tax time without receiving benefits. Naturally, you can now understand the importance of filling your tax returns, on time. What this means is when you do not file your taxes, you are missing out on money saving benefits that help make life operate a little smoother and lower your overall tax burden.
Need advice on tax preparation or shared custody? Try these local Ottawa resources:
Ottawa, ON K1N 5Z5
Tel. (613) 567-7088
Ottawa, Ontario K2E 8C4
Phone: (613) 232-8832