If you’ve recently been hired for a new job in British Columbia, you’ll soon be asked to fill out at TD1BC Form for 2020. This is a personal tax credit return form that tells your employer what kind of taxes they should withhold from your pay. It may also give you a preview of the personal tax credits you will benefit from. This form is mandatory, important and, when filled out correctly, can benefit you. Here’s what you need to know about the form.
What is the TD1BC Form?
The TD1BC form is British Columbia’s version of the TD1 Form. This form asks you about your personal claims and eligibility to determine your provincial tax deductions.
What do Employers Do with TD1 Forms?
Using the information provided on the forms, either the TD1 federal or you provincial TD1, your employer will determine the amount of your tax deductions, in order to calculate your federal and provincial income tax withholdings from your pay cheque. If you fill out this form properly the amount your employer reduces your pay cheque by should be very accurate. Ensure that you read both sides of the forms very careful and answer all questions honestly for the most accuracy.
Is it Mandatory to Fill Out TD1BC Forms?
It is mandatory to fill out a TD1BC form for each of your employers. You should also update the form if you become eligible for a new tax credit covered on the form, or if you lose eligibility for a tax credit you signed up for.
How to Fill Out the TD1BC Form
In order to complete this form, you will need some of your personal information, including your social insurance number or, if you’re a non-resident, your country of permanent residence.
As you’ll see at the top of the form, everyone in British Columbia has their taxes deducted by the basic personal amount, which in 2020 is $10,949. If your income from all sources (including self-employment, other employers, and RRSP benefits) is less than this basic amount, then all you have to do to complete the form is check the box on the back (besides putting in your personal information of course). As your income is so low, your employer does not need to hold back any money for taxes.
If your income will be above the basic personal amount than you should fill out the rest of the form. Essentially, all you have to do is go through the list and determine if you’re eligible for the tax credit that is listed.
In British Columbia, these personal tax credits include:
- Age amount: If you are 65 and older (or will be by the end of the relevant tax year), and depending upon your income, you may be eligible for a full or partial claim.
- Pension income amount: Depending on your pension type and income, you may enter an amount here
- Disability amount: If you claim a tax credit for your disability, enter the listed amount here.
- Spouse or common-law partner amount: If you are supporting a spouse or common-law partner, depending upon their income, you may be eligible for a full or partial claim
- Amount for an eligible dependent: If you support a dependent relative (they must be eligible) and do not have a spouse or common-law partner, you may qualify for this tax credit, in full or partial.
- British Columbia caregiver amount: If you’re caring for someone over 18 who is infirm you may be able to get a tax credit for them. This must be a relative, such as a child, grandchild, parent, grandparent, brother, sister, uncle, aunt, nephew or niece who is a resident of Canada.
- Amounts transferred from your spouse or common-law partner: Some of your spouse or common-law partner’s unused tax credits can be transferred to you.
- Amounts transferred from a dependent: Some of your dependent’s disability amount can be transferred to you if they will not use it.
Once you have selected all of the tax credits that apply to you, you need to add up their total and place the sum in Box 11.
How to Fill Out the TD1BC Form When You Have Multiple Employers
It’s important to note that you cannot claim any of these tax credits twice. This means that if you have a second job, you should not claim anything on your second TD1BC, not even the basic amount. On side 2 of the form you will check the box that indicates multiple employers and follow the instructions. If you do not, you’ll be benefiting from the tax credits the same. If you did claim the credits at both jobs, you could have a large bill due at tax time.
In fact, if you wish, you can elect to have additional tax deducted by your employer with this form. Otherwise, just sign and date the back of the form and it’s completed.