April 14, 2024

The Queens County Citizen

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Tax Credits and the Elderly | How to navigate this puzzle?

Tax Credits and the Elderly |  How to navigate this puzzle?

Filing your income tax return isn't easy, it doesn't get any easier as you get older. Tips and tools to make sure you claim your dues.

Credit for persons living alone, amount sanctioned on account of age, credit for support of elderly, credit for household support, credit for natural carers etc. These are just some of the measures aimed at reducing people's tax bill.

“It's important to take some time to get informed,” Anik Bougi, practice head, financial planning and taxation at Professionals Financial (fdp) said in an interview.

She suggests seniors go to the Canada Revenue Agency and Revenue Quebec websites to get started. You don't serve yourself better, she says. However, she advises against calling the tax authorities directly.

“Doing business with a tax preparer is usually money well invested,” continues Anik Bougie. Their work allows an elderly person to receive thousands of dollars in credits in some cases. It is worth getting good support from an accountant or tax specialist,” she stresses. For the less fortunate, she invites them to contact a free tax preparation service provided by volunteers.

Natural preservatives

Generally speaking, there are many credits meant for senior citizens and the names are similar, which adds to the confusion. This is especially true when it comes to caregivers. There are three credits available: two federal and one provincial, and they have very similar names.

These are non-refundable federal credits for eligible dependents, the Canadian Caregiver Credit and the refundable Caregiver Credit from the Government of Quebec.

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The Chair of Taxation and Public Finance at the University of Sherbrooke (CFFP) is doing useful work by making available to the public a user-friendly tool that helps carers determine who is eligible in terms of natural, clarifying tax credits. An irrelevant feature of tax measures.

Consult the Chair of Taxation and Public Finance at the University of Sherbrooke

“It's a very interesting tool. It's more prescriptive. Instead of trying to understand the rules through eight paragraphs, CFFP goes there in the form of questions and answers,” suggests Anik Bougi. “As soon as a question is asked, we answer it with yes or no, and if we continue to qualify based on the criteria Takes us to the next step. If it's up to me, all credits should have such tools.”

Criteria for determining eligibility for these non-refundable credits include the elderly's health status, their age, their income, relationship with a caregiver, and whether they live with a caregiver. A natural guardian shall not receive any remuneration from the ward.

An example

Consider Alice, 60, who helps her elderly mother, Margot, 82, who is disabled and needs help with dressing, cooking and toileting. Margot lives alone with an income of $25,000 per year.

In this case, under the CFFP tool, Alice can claim a Canadian caregiver credit of approximately $1,782. She can also claim her Quebec counterpart, a tax credit for caregivers, while helping her elderly mother Margot 365 days in a row without a break. In this case, according to the instrument, Alice is entitled to a $1,309 refundable credit.

Note that Alice is not eligible for the third credit, and qualified dependents are not. She has to live with Margot under the same roof and has no deserving spouse.

Major credits for seniors

Refundable Credit for Home Support (CIMAD) – Quebec

For age 70 and older, the minimum credit for independent seniors renting is $133.20, before the deduction when household income exceeds $65,700.

Refundable credit for support for seniors – Quebec

For those age 70 and older, the maximum credit is $2,000 before the deduction when income exceeds $25,755. Credit up to $4,000 per individual and eligible spouse.

Repayable Credit for Multigenerational Home Renovation – Canada

Read the file “Tax Season: What's New This Spring?” »

Tax credit for career extension – Quebec

It allows a person age 60 or older to benefit from a non-refundable tax credit of 14% of their work income over $5,000.

Pension income distribution – Quebec and Canada

Individuals can allocate up to 50% of their eligible pension income to their spouse for income tax purposes, such as a payment from an annuity or RRIF from a retirement plan.

Granted amount for pension income – Canada

Individuals aged 65 and over are eligible for up to $2,000 when they declare qualifying pension, retirement or annual income. Quebec, for its part, pays a maximum non-refundable credit of $450 before a deduction based on income.

Disability Tax Credit – Canada

The maximum value of the disability tax credit is $1,414. Medical certificate is required.

Non-refundable tax credit for severe and chronic impairment – Quebec

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Maximum credit value is $534. Medical certificate is required.

Refundable tax credit for expenses incurred by a senior to maintain their independence – Quebec

For those aged 70 years and above, 20% credit on expenses

Non-refundable Home Accessibility Credit – Canada

For those 65 and older, up to a maximum of $3,000. Medical certificate is required.

Other activities not to be forgotten

Housing Allowance Program – Quebec
Amount Granted on account of age – Canada
Non-refundable credit for people living alone – Quebec
Assistance program for seniors to partially offset increases in municipal taxes – Quebec
Credit for medical expenses (refundable and non-refundable) – Canada and Quebec

Learn more

  • 25.5%
    Percentage of people aged 65 and over who filed an income tax return in Quebec in 2020

    Source: Quebec Tax Training Centre

    Percentage of taxpayers age 65 and older who paid $0 in tax in 2020

    Source: Quebec Tax Training Centre

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