Money

It was just a few weeks ago that many of us settled any outstanding balances for 2009 with the Canadian Revenue Agency (CRA). Some of us got a refund, and some of us paid, but we can all agree that the main goal is to keep more money in our own pocket. You can do this by taking full advantage of the deductions and credits available.

It sounds so simple, but keeping a folder of documents and receipts throughout the year will keep tax season stress-free and ensure you do not miss out on tax credits. 

• Charitable donations: This is the season where your friends and co-workers are soliciting donations for charity runs/ walks. You'll often request a receipt on the pledge form, but don’t follow up to ensure that you received it.  If you pledged online, you may have gotten the electronic receipt, and deleted it or filed it away in an electronic folder somewhere. These donations will provide you a credit of 15 per cent on the first $200, and a 29 per cent credit for any donations over $200.   Keep track of your donations and file the receipts. Without the receipts, you can not claim these donations on your return.
   
• Transit passes: Don't throw away your old monthly transit pass! The full amount that you paid for the pass is eligible for a 15 per cent tax credit. Some people don't realize that you don't have to buy passes for the entire year to claim them on your return. You can claim them whether you bought a monthly pass for only one month out of the year or all twelve months.


• Children’s activities: As a parent, you can claim up to $500 per year for eligible fitness expenses for children under 16. It's very common for children to be enrolled in many activities outside of school, and most of these activities can be quite costly. Some of these costs can be offset if you take advantage of this deduction, providing it meets CRA’s criteria for a prescribed program for physical activity.
   
• Moving expenses: You can deduct moving expenses, providing that your new home is at least 40km closer to your new work location (or school if you're a student).

• Interest on an investment loan: The interest expense is tax deductible if the money was borrowed for the purpose of investing and there is an expectation that you will be receiving income from these investments. However, this is not available for RRSP loans as there is already a deduction for the RRSP.

Julie is a Certified Financial Planner and has worked in the financial industry for 10 years supporting investors, advisors, and institutions. Julie has contributed editorial content on various financial topics in addition to teaching business courses at Conestoga College in Kicthener.

 

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