Universal Child Care Benefit
In 2015, the universal childcare benefit (UCCB) will get better. It will be extended to children over five and under eighteen. For children under six, it will be increased from $100 to $160 per month and $60 monthly for children under the age of eighteen. While improvements take effect from January 2015, they will not be included in the monthly payments before July 2015. A retroactive adjustment will be included in your regular payment for July. Some taxpayers whose income is too high to get the Canada Child Tax Benefit will now be able to apply for it.
As the UCCB is taxable, single mothers should include it in their child's income if it is more advantageous for them.
RESP
The Education Savings Plan has no impact on the tax return of investing parents, but when their children use it, it will be included in their income, said Ms. Girard.
Then, the portion invested by parents will not be taxable, but the interests and Canadian subsidy will be.
Balance between income and benefits
Family benefits decrease as your salary increases. It is therefore possible that a wage increase does not affect your overall financial situation.
Avoid unpleasant surprises
As emphasized by Ms. Girard, “We think about our taxes around the months of March and April and when important changes occur. However in July, with both feet into the sand, we think about it less. We should keep track of governmental tax announcements throughout the year to avoid nasty surprises on the next year.”
Parents have a lot to do and don’t always remember to contact the government when they split up or when they’ve been with a partner for a year. Any changes in marital status need to be reported to both Quebec and Canada revenue services to avoid any bad surprises.
Do sports and arts activities are all credits?
Johan Girard, H&R Block
The government does not pay for everything, says Johan Girard, but this program is an incentive to make children practice sports and artistic activities. For children under 16, the allocated credit is up to $1,000 per year. For children's arts, a maximum of $500 per child is allocated for expenses paid. Keep in mind that these amounts are non-refundable tax credits, so they reduce the tax payable.
Ms. Girard also reminds parents to keep receipts from the previous season. “Parents often bring us receipts only for fall and forget the ones for the past spring activity. Declared fees for sports or artistic activities must have been paid during the tax year, between January 1 and December 31”.
