It’s that time of the year again. While everybody is starting to get their paperwork ready for the 2018 tax return, we at Softron are ready to do our best to save you tax dollars. This year is a mixed bag when it comes to tax credits.
The tax changes that will impact your tax returns are discussed as follows:
Climate action incentive payments:
Everybody gets a refund and it’s good for the environment too! Well, everybody may not get a refund, but this non-refundable tax credit will definitely lower your tax owing. A family of two adults and two children is qualified for a tax incentive of $307.00. So even if you had no income in 2018 and paid no taxes, you will qualify for a tax refund this year.
The government has changed tax laws around income sprinkling. A tax on split income may be applicable in some cases for children under 18 years at the highest rate of 33%. So, if you child receives any income from your business, partnership, rental property or trusts, it is highly recommended that you should discuss your tax situation with an expert at Softron to ensure that your taxes are filed accurately, and you are best advised on your case.
Expanded Medical Tax Credit:
The medical tax credit has expanded. Patients can now claim any money they spent on prescribed medical marijuana. Keyword here being “prescribed”. Also, couples that are undergoing fertility treatments and spending money on treatments like IVF, can now claim all their expenses under the medical tax credit.
Credits that got the Axe:
· Public Transit Tax Deduction is no longer applicable. It will make a big difference in for people living in Greater Toronto Area as public transit costs can be very high depending on the type of commute.
· No fitness or arts tax credit for money spent for arts and fitness activities of children.
· No education and text book credits for students. Recently Ontario government also announced scrapping of free tuition for children from lower income families. So, increasing education costs combined with reduced tax credits will put financial pressure on students.
As I said, it’s a mixed bad and some tax rules can be complicated and confusing. Therefore, prepare yourself by asking your tax accountant all the questions that seem relevant to your case and we at Softron will advise you to ensure you save money on taxes.