You’re familiar with the saying, “Knowledge is Power?” When it comes to your taxes, it pays to educate yourself on what is available to you in terms of tax credits, deductions and rebates.
“There are dozens of tax credits, deductions and rebates that are available,” says Jeff Schwartz, executive director, Consolidated Credit Counseling Services of Canada. “However, in many cases, you may not be aware that they exist. If you’re not taking advantage of all of these tax breaks, you are literally leaving money on the table.”
“Don’t wait until the tax deadline to investigate what is available to you,” he says. “Include tax planning as part of your financial strategy throughout the year. If you are rushing to file, you may miss out on some great financial benefits.”
Overlooked tax credits, deductions and rebates
Medical expense deduction
Do you pay any medical expense or vision care premiums? These expenses may be deductible. If you have an elderly parent that is dependent on you, in many cases you can deduct their medical expenses as well.
Moving expense deduction
Did you move this year? There are several conditions, but in many cases, if you have moved more than 40km for work, you can deduct costs like title transfer, travel costs, fees to change documentation and costs for utility hookups and disconnections.
Deducting charitable donations
Make sure that you always ask for and keep your receipt when you make a charitable donation. You can combine separate donations as well.
If you qualify for the disability tax credit, you are eligible for up to $8,000 in tax benefit. If you have a child who has a disability, you are entitled to a tax-free benefit of up to $2,730 per year. To qualify, your child must be “under age 18 with a severe and prolonged impairment in physical or mental functions,” as certified by a doctor.
Student loan interest is deductible
Students saddled with debt will be pleased to take advantage of this tax break. The interest paid on your student loan is tax deductible. There are several conditions around this (i.e. if it is a qualifying loan). If you have combined your student loan with other loans, the interest is not tax deductible.