The Canada Child Benefit replaced the Canada Child Tax Benefit in 2016.
The CCB can provide a maximum annual benefit of up to $6,765 per child under the age of 6 and up to $5,708 per child between 6-17 years of age. Families with less than $31,711 in net income can receive the maximum benefit. For families making more than that, it is gradually phased out.
Beginning in 2019, social assistance payments received by kinship care providers is excluded from net income for the purpose of calculating your CCB payments. This change is retroactive to 2010.
Donations & Medical Expenses
In a family, each spouse can claim their own charitable donations or all donations can be claimed by one spouse. The first $200 of donations is worth 15% while anything additional is worth 29% or 33% depending on your taxable income level. As a result, it is usually more beneficial for one spouse to make the claim.
Spouses can also combine medical expenses and have the lower-income spouse claim the total. Expenses over 3% of net income count towards a credit.
The supplemental parental sharing benefit will provide an additional five weeks of benefits when both parents agree to share parental leave, designed to provide greater flexibility to families. It took effect for children born or placed for adoption after March 17, 2019. According to Employment and Social Development Canada, when women have equal opportunities to succeed, they are powerful agents of change that can help improve the quality of families and communities. This is a big step towards promoting greater gender equality at home and in the workplace.
To be eligible for the EI parental sharing benefit, you must meet the following criteria:
• Parents with children born or placed for adoption on or after March 17, 2019 will be eligible for the benefit.
• Parents including same-sex and adoptive parents, are eligible for this credit only if both new parents share the time at home with the new baby.
• Parents selecting the standard duration of parental leave could receive up to 40 weeks of parental benefits (an increase from the current 35 weeks).
Parents selecting the extended duration of parental benefits could receive up to 69 weeks of parental benefits (an increase from the current 61 weeks). A wonderful reason to exercise a little teamwork, right?
The Working While on Claim program has also been extended to maternity and sickness benefits so that mothers now have greater flexibility in planning their return to work, while keeping more of their EI benefits. This pilot program allows claimants to keep 50 cents of their EI benefits for every dollar they earn, up to a maximum of 90% of their EI benefits.
The Working While on Claim rules now apply to sickness and maternity benefits. This one can get a tad complicated, and we suggest calling DTA or Service Canada to have a clearer understanding of the complex rules. However, we’ll try and simply it for you in our scenario. Some women on maternity leave choose to return to work early, before their EI benefits end. As a result, it means an adjustment to how much they receive in EI benefits. A claimant receives 55% of their weekly salary as their EI benefit, but when they return to work early, they must subtract 50 cents of each dollar they earn. This amount will then be subtracted from their overall EI benefit.
For example: Before mat leave, Susan earned $600/week, and her EI benefit is 55% of this, so she receives $330/week while on maternity leave. She returns back to work part time, for a total of $400/week salary. She needs to subtract 50 cents of each dollar earned ($200) from her EI benefit. Now her EI benefit is $130/week, plus she keeps her weekly salary, so her total earnings will be $530.
Whether a nuclear or blended family, there are a few tax implications to keep in mind that may improve your overall tax situation this year. Speak to a professional at DTA to have your questions answered.