Families

Get the Most Out of Your Spouse, Kids and Parents at Tax Time: Maximizing Dependant and Spousal-Based Deductions

Please note that this post was published in 2014 and contains information that is no longer applicable. It is preserved here for individuals who are preparing tax returns for prior years only.

Combing over your income tax looking for every possible deduction? Don’t forget about the people around you – your family! Spouses, children, aging parents – they’re all sources of potential tax deductions that can pump up your refund.

Here are some of the most common family-related deductions that you may be able to take:

  • Spouse or common-law partner amount
  • Support payments
  • Spousal RRSP deduction
  • Child-care expenses
  • Amount for each child under 18 at the end of the year
  • Children’s fitness and art amounts
  • Amounts for tuition, education, and textbooks
  • Medical expenses
  • Family caregiver tax credit
  • Public transit amount

Spousal Credits

The spouse or common-law partner amount:

If you supported your spouse or common-law partner at any time during the year and his or her net income was less than $11,038, you can claim this amount (minus his or her income). If you’re also claiming the Family caregiver amount, his or her income must be less than $13,078.

Support payments:

Did you make support payments to your current or a former spouse or common-law partner during the past tax year? If so, you can claim the deductible portions of the support you paid on your tax return.

Spousal RRSP deduction:

As long as you have enough contribution room (see your Notice of Assessment from last year for your RRSP deduction limit), you can contribute to a spousal RRSP in lieu of or in addition to your own – giving you even more of a tax deduction and sheltering more of your income from tax.

Eligible Children’s Tax Credits

Child-care expenses:

Fees paid to a baby sitter, nursery school or day care center; they all count if you’ve had to pay for child care because you or your spouse was working or in school this past tax year. Generally the spouse with the lower net income (even if it’s zero income) has to claim these expenses.

Amount for children born in 1996 or later:

For each child under 18 at the end of the year you get to claim $2,234. And if a child has a physical or mental impairment you may be able to claim the Family caregiver amount of $2,040 as well.

Children’s fitness amount:

You can claim to a maximum of $500 per child the fees paid in 2013 relating to the cost of registration or membership for your or your spouse’s or common-law partner’s child in a prescribed program of physical activity such as hockey, martial arts or gymnastics.

Children’s art amount:

And the same thing applies to any “artistic, cultural, recreational, or developmental activity” you registered your child in in 2013; you can deduct a maximum of $500 per child for those program fees as well.

Tuition, education and textbook amounts:

Your older children can also provide you with a tax break if they’ve attended a post-secondary educational institution, either full- or part-time in 2013. They get to claim tuition, education and textbooks amounts on their income tax. But once their income is zeroed out, they can transfer up to $5,000 (less the amount they needed to use to eliminate their own tax payable) to a parent or grandparent.

Deductible Family Expenses

Medical expenses:

You’re not limited to claiming your own medical expenses on your tax return; you can claim the medical expenses of your spouse (or common-law partner) and your children under age 18 as well, as long as they’re eligible medical expenses you haven’t claimed before and fall within the 12-month period ending in the current tax year that you’ve chosen.

While only expenses that exceed the lesser of $2,152 or three percent of net income can be claimed, getting above that threshold isn’t difficult for the typical family when you take a look at all the expenses that are eligible.

Tax Tip:

Don’t forget to claim all the medical expenses on the tax return of the spouse with the lowest net income.

Amount for an eligible dependant: Is one of your parents infirm and living with you? Or are you living with a child under 18 who is related to you or adopted and has impaired physical or mental functions? Then you may be able to claim this tax credit.

(Note though that only one person in your household can claim this amount and you can’t claim this amount for a common-law partner or spouse.)

There is also a separate amount for infirm dependants age 18 or older. This credit allows you to claim up to $6, 530 which includes the $2,040 family caregiver amount; for each of your or your spouse’s or common-law partner’s dependent children or grandchildren only if that person had an impairment in physical or mental functions and was born in 1995 or earlier.

Family caregiver tax credit:

If you have a dependent with an impairment in physical or mental functions, you may be eligible to claim an additional amount of $2,040 for one or more of the following amounts:

  • spouse or common-law partner amount;
  • amount for an eligible dependant ;
  • amount for children born in 1996 or later and;
  • caregiver amount.

Public transit amount:

You can claim the cost of monthly public transit passes or passes of longer duration for travel within Canada on public transit for 2013, for you, your spouse or common-law partner and each of your children. Subways, buses, commuter trains, ferries – they all count, as long as you have the right kind of passes.