Why read this?
– paying student loans;
– adopting a child;
– raising children; or
– paying for kids’ extra-curricular activities.
What to do
1. Claim interest on student loans
- You can deduct loan interest under the Canada Student Loans Act, the Canada Student Financial Assistance Act, or similar provincial or territorial programs.
- Interest paid in the current or preceding five years is eligible for a 15% non-refundable credit.
- Enter the interest on Line 319 in Schedule 1.
TIP: Claim the corresponding provincial or territorial credit on Line 5852 of her province or territory’s Form 428.
2. Claim adoption expenses
- If you adopt a child, you can claim a 15% non-refundable credit for expenses, to a maximum of $15,453 per child in 2016. It can be claimed by one parent or split between two partners.
- Eligible expenses include adoption agency fees, legal expenses, travel costs, and mandatory dues to a foreign institution.
- Enter total eligible expenses on Line 313 of your return.
TIP: Newfoundland, Ontario, Manitoba, Alberta, British Columbia and Yukon also have adoption tax credits, says Dora Mariani, principal at Segal LLP in Toronto. In Quebec, residents are eligible for a refundable credit worth up to $10,000, adds Sam Lackman, manager, Tax, at Nexia Friedman in Montreal.
3. Claim the children’s art credit
- You can claim a non-refundable credit of up to $250 for expenses related to children’s art activities in 2016.
- The child must be younger than 16 and enrolled in an activity that’s at least eight weeks long, with one lesson per week. Summer camp qualifies if it’s five days long and 50% of the time is spent on creative activities.
- Enter the total amount of expenses on Line 370.
TIP: If your child is eligible for the disability tax credit, you can claim an additional $500. See “Tax Treatment,” AER January 2015.
WARNING: The children’s arts credit will be eliminated for the 2017 tax year.
Sources: Dora Mariani, CA, CPA, CFP, TEP principal, Segall LLP; Sam Lackman CRA, KPMG’s Tax Planning for You and Your Family 2015.
Updated July 2016.