Home Renovation Tax Credit: If you redid your kitchen, built a deck, replaced the roof or did other home renovations you can claim it on your taxes for 2009 only. You’ll get a 15 per cent tax credit on any expenditure above $1,000 and up to $10,000. Get an official receipt that has the name and GST number of the vendor, as well as details on the work that was done. Don’t forget equipment rentals or the cost of building plans or permits.
Capital losses: These can be carried forward indefinitely, or carried back to recover the taxes paid on capital gains in any of the last three years.
Child Fitness tax credit: This is worth up to $500 for each child under 16 who is enrolled in an eligible physical fitness activity. Hockey, soccer, karate, football, basketball, swimming, hiking, horseback riding, and sailing are typically eligible, depending on how long the sessions are. The organization responsible for the activity should issue a receipt that include the activity, your child’s name and year of birth, and the amount paid for the program.
Transit Pass tax credit: monthly and yearly transit passes are eligible for this one. You can claim the cost for any dependent child under 19 but keep the passes or the receipt.
Child care: If you hired a nanny, babysitter, or sent your child to daycare in order to work or attend school, this tax deduction is worth up to $7,000 per child under 7 years old and $4,000 for those between 7 and 16 years. For a child under 17 who is eligible to receive the disability tax credit, the limit is $10,0000. The spouse with the lower income gets the deduction.
Tuition, education and textbook credits: These credits allow students to reduce their income taxes by taking into account their tuition fees, as well as an education tax credit worth $400 per month for full-time students and $120 per month for part-time students. The textbook tax credit is worth $65 per month for full-time students and $20 per month for part-time students. If the students’ income is too low to make use of these credits, they can be transferred to a parent or carried forward for use in the future.
Medical expenses: there’s a long list of expenses that qualify from acoustic couplers and air conditioners to walking aids and wigs. See the Canada Revenue Agency website or use online tax software for details.
Canada Revenue Agency will use your return to calculate whether you are entitled to government payouts such as the Canada Child Tax Credit and the GST credit.
Also this year, Ontario will be offering a sales tax transition credit to take the sting out of the new Harmonized Sales Tax, which takes effect July 1. Filing on time when get you those rebates sooner.
If you’re lucky enough to get a big tax refund, make the most of it. For parents with young children, Galvin suggests socking it away in a Registered Education Savings Plan. “That way you make the most of the government grants that are available.”
Tempting as it may seem to blow your refund on a new flat screen television or last-minute getaway, experts say to resist the urge. Pay down your debt, or save it in your Registered Retirement Savings Plan or Tax-Free Savings Account instead.
If you have a few minutes to spare, explain to your children that you’re filing an income tax return, what that means, and why it’s so important, said John Waters, manager of tax planning at BMO Nesbitt Burns.
Make the effort, especially if you have teenagers – who, by the way, can file a return to account for the income they made from a summer job. That way they can start building up contribution room for their own RRSP.
“They’re out making money on a summer job and there’s all those deductions, for EI and CPP and they don’t really understand why. Explain that this is how the system works. It’s an important life lesson: death and taxes, everybody has to deal with these things,” Waters said.
“I will never forget when I was a teenager and my mother sat me down and walked me through my tax return. It was really eye-opening for me to understand how the system works.”
Ref:Toronto star
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