Frequently Asked Questions
A list of the top questions we receive!
(Click on the tax questions below to reveal the answer.)
Check your Notice of Assessment of the last tax return that you have. You will see at the bottom how much you can contribute without going over.
This is a complex question as everyone is different. There is no right or wrong answer. The idea of contributing to your RRSP is to help defer your taxes when you’re in a higher tax bracket to when you’re in a lower tax bracket when you retire. You can also choose to contribute while you’re in a lower tax bracket but not deduct it until you will be in a higher tax bracket in future years. Please see a tax professional to determine the best strategy for you.
Your child can transfer up to maximum of $5000 federal as long as your child does not need it to help reduce his/her taxes payable. Be sure to have your child sign the back of the T2202 form to authorize the transfer of the credits. The CRA generally asks for this on a regular basis.
My child is a college/university student and yet my child was not able to transfer tuition to me. Why not?
The child must use the tuition first to reduce any taxes payable before s/he can transfer any unused tuition to you. If s/he has used it all up, then there is no unused tuition available to transfer to you.
I’ve just heard that I may be able to claim the disability tax credit on my tax return. What do I have to do to claim this?
You will have to print off form T2201 – Disability Tax Credit Certificate and get a specific doctor to fill out the section where you have a disability then send the form in. Expect 8-10 weeks before you find out if you qualify. You may be able to apply the credit against your prior year’s return and will result in a greater refund. The CRA will usually adjust the returns for the years that you qualified for it.
The Canada child benefit (CCB) is a tax-free monthly payment made to eligible families to help them with the cost of raising children under 18 years of age. The Canada Revenue Agency uses information from your income tax and benefit return to calculate how much your CCB payments will be. To get the CCB, you have to file your return every year, even if you did not have income in the year. If you have a spouse or common-law partner, they also have to file a return every year.
How come I can’t transfer the full 50% of my pension with my spouse? I only got a lower percentage for pension splitting.
It may not be the most tax-efficient manner. Keep in mind that your spouse may have other taxable income and by claiming the full 50% of your pension, it may cost your spouse more money in the long run. The tax software does the calculations to determine the most optimal tax advantage for you as a couple.
You must apply for Old Age Security (OAS). It is best to start applying for it 6 months before you turn 65 to allow Service Canada time to process your application. Apply for the OAS immediately as you will only be able to get retroactive payments up to 11 months. Be sure to continue filing your tax return on time in order to renew your application every year!
Any pension received from a company regardless of how old you are, RRIF when you turn 65, and any pension income received as result of spouse or common-law partner. You can only split them with your spouse or common-law partner.
Note that Old Age Security (OAS), CPP, and RRIF under the age of 65 do NOT qualify for pension income splitting.
You can still split pension with your spouse or common-law partner even when involuntarily separated for medical, educational or business reasons.
Your T4 (employment income) slip and T5 (investment income and/or dividends) will be mailed out by February 28th. T3’s (investments such as interest, dividends and capital gains) will be mailed out by March 30th.
It is past the date that T slips have been sent out and I haven’t received my T4 from a previous employer, why haven’t I received it yet?
If you have changed addresses and haven’t updated your previous employer it is likely that your T4 has been sent to the address they have on file. Get in contact with your previous employer to confirm the status of your T4 slip.
If you have a My Account with CRA, log in it. Select “Tax information slips (T4 and more)” and select the current year and T4 from the drop-down menus. You can then print a copy of your T4. If you do not have a My Account, ask us and we can obtain a copy for you!
After exhausting all options, take your last paystub of the year and enter in the amounts into your tax return such as Gross Wages, CPP, EI, Union Dues (if applicable), Charitable donations (if applicable). The CRA will then adjust your return to the copy of the T4 that they will have on file. It is always better to report your income rather than omitting it as the CRA will charge you a 10% penalty on the balance owing for not entering in a slip the first time. If you do this again within the next 3 years, they will charge you a 20% penalty on your taxes owing.
The deadline for contributing to an RRSP is March 1.
Interest on student loans, moving expenses, child care (if you require it), employment income. If you are unsure keep your receipts in an organized file and take them to your tax professional.
Contact your post-secondary institution on where to find the T2202A tax forms, however, tax forms for tuition can generally be found on your post-secondary hub website.
The child disability benefit is a tax-free payment for any legal guardian of a child with a severe and prolonged disability. To qualify for this benefit you must be eligible for the Canada child benefit and your child must be eligible for the disability tax credit. It is calculated by the number of eligibly children, adjusted to your family net income and your marital status.
Beginning in the 2018 tax year, a new credit was introduced for residents of Manitoba, Alberta, Ontario and Saskatchewan. Residents of small and rural communities are also eligible for an additional 10% supplement, if you live outside the Census Metropolitan Areas.
The Ontario Trillium Benefit helps low to moderate income Ontario residents. The benefit combines these three credits Northern Ontario Energy Credit, Ontario Energy and Property Tax Credit and Ontario Sales Tax Credit. You must be eligible for one of the three credits in order to receive the benefit.