by Evelyn Jacks
Going back to school this fall? If so, you might be paying child care to do so. The good news is that those expenditures may be deductible. The rules below are important so you can keep the receipts and make a claim for child care expenses come tax time:
An eligible child for the purposes of claiming child care must be
The definition of child includes an adopted child or the spouse of a child of the taxpayer. The definition of a dependant child is one whose net income is less than the Basic Personal Amount.
Child care must be for services provided in Canada (although special rules exist for deemed residents and US-Canada commuters) by:
The following are specific expenses that may be claimed:
Maximum claim. The maximum claim for child care expenses is the least of:
Limitations for Students who are Parents. In addition to the limitations for all taxpayers, students have the following limitations on their child care expense claims.
Full time students are limited in their claims to:
times the number of weeks of full-time attendance. Part-time students are limited to the above amounts times the number of months of part-time attendance.
Who Claims? Generally, child care expenses may only be claimed by the supporting person with the lower income. However, in the case of students, the higher income person may claim child care expenses during periods in which the other supporting person was a full- or part-time student. When the lower-income taxpayer is a part-time student, the limits to part-time students apply to the claim made by the higher-income taxpayer, and when the lower-income taxpayer is a full-time student, the limits to full-time students apply to claims made by the higher-income taxpayer.
Ineligible Expenditures. For your information include medical or hospital care, clothing, transportation, tuition fees, board and lodging expenses except when they are included in the total charges for a boarding school, day camp or overnight sports school and do not exceed the weekly limits, expenses which were not actually paid or which were or will be reimbursed.
And there is more good news: some of your expenses may be eligible for both the Children's Fitness Amount and the deduction for child care expenses. In that case, the expenses must first be claimed as child care expenses. Only the unused amount after claiming child care expenses may be claimed for the fitness credit amount. We will tell you more about that, next time.
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