As a senior in Canada you just may be wondering where you fit into the tax system when it comes to paying or receiving at the end of the tax year. While the Canada tax system has a lot of information support it often doesn’t make it any easier to understand. For this reason a lot of Toronto seniors who really don’t have a lot of financial dealings will still use a Toronto tax accountant to help them with their tax return each year.
While the CRA is quick to jump on you if you make a mistake in what you owe them, they are not going to be as liberal when it comes to possible tax credits that were missed because of an error on your part. In fairness the CRA like any other business is staff strapped and more time is spent on collections which doesn’t leave a lot of manpower to help out those who may be missing potential tax benefits.
In a recent CRA report there was some interesting information for seniors….
“The Harper Government highlights support for seniors and pensioners on National Seniors Day
Ottawa, Ontario, October 1, 2013… The Honourable Kerry-Lynne D. Findlay, P.C., Q.C., M.P., Minister of National Revenue, and Royal Galipeau, Member of Parliament for Ottawa-Orleans, participated in an event to celebrate National Seniors Day and to promote the many tax relief measures and benefits available to seniors in Canada. Seniors are now receiving approximately $2.7 billion in additional tax relief as a result of these benefits.
“Our Government is proud to pay tribute to the seniors who have helped build our country and continue to make valuable contributions to Canadian communities, workplaces, and society. We also want to ensure seniors are aware of the credits and benefits they are entitled to,” said Minister Findlay. “I am happy to see that the number of Canadian seniors claiming credits and benefits designed specifically for them is increasing year after year.”
Tax savings and services for seniors include:
Canadians aged 65 or older can claim the age amount, a non-refundable tax credit to help seniors. The age amount has increased by $1,654 since 2006, and was claimed by almost 5 million seniors in 2012.
In 2012, more than 4.5 million people claimed the non-refundable pension income amount. The maximum amount of pension income that may be claimed in calculating the 15% non-refundable credit doubled in 2006 from $1,000 to $2,000.
Pension income splitting was introduced by the Harper Government in 2007 and provides a means for seniors to save money. It gives eligible Canadians the opportunity to split up to 50% of their eligible pension income with their spouse or common-law partner, reducing their overall family tax burden. More than 1 million couples took advantage of pension income splitting in 2012.
Seniors with low-to-modest incomes can also claim the Goods and Services Tax/Harmonized Sales Tax (GST/HST) Credit to help reduce the cost of making GST and HST payments.
Seniors who use public transit might be able to claim the Public Transit Amount on their income tax and benefit return to increase their savings at tax time.
Seniors can claim medical expenses, such as hearing aids, pacemakers, hospital services, and nursing home costs, on their income tax and benefit return to get tax relief.
Introduced in 2009, the Tax-Free Savings Account (TFSA) provides seniors with a tax-efficient savings vehicle to help meet ongoing savings needs. The Harper Government has also increased the age limit for contributing to a Registered Retirement Savings Plans (RRSPs) from 69 to 71.
Seniors may also be eligible to take advantage of the Community Volunteer Income Tax Program (CVITP), a collaboration between community organizations and the Canada Revenue Agency. The CVITP helps prepare tax returns for individuals who have low income and a simple tax situation. Individuals who file a return may be entitled to certain credits and benefits. Volunteer tax preparation clinics are generally offered from February to April across Canada”…. Continue reading
While there is probably a lot of information in this article that many seniors are aware of there could also be some that is new to them. Every little bit helps when it comes to savings on taxes. If you are responsible for doing the taxes for a senior you may want to give this responsibility to a Toronto tax accountant who is going to ensure that all of the applicable credits are applied.
