As with every tax season, there are important changes and improvements of which you should be aware of when tax planning. This year, we are seeing new and improved benefits, credits and services as well as the addition of enhanced services, such as express Notice of Assessment (NOA), account alerts, account integrations, and a new mobile app.
There are some other important changes to the income splitting tax credit, the children’s fitness and arts tax credits, as well as the home accessibility tax credit. There were also modifications made with regard to reporting the sale of your principal residence.
Starting in 2016, taxpayers are now required to provide basic information about their principal residence on their return. This includes information such as the date of acquisition, proceeds of disposition and address.
Benefits and Credits
Canada Child Benefit (CCB)
The CCB was implemented to replace the Canadian child tax benefit, national child benefit supplement and the universal child care benefit. It is a tax-free payment provided to families to assist with the cost of raising children younger than 18 years of age. The payment is delivered monthly to eligible families and, where applicable, includes the child disability benefit and related provincial/territorial programs.
Northern Residents Deductions
The Northern Residents Deduction may be granted to taxpayers who live in northern or isolated areas on a permanent basis and for a continuous period of at least six consecutive months. For 2016 and later, the amount used to calculate the deduction has increased from $8.25 per day to $11.00 per day.
It is important to note that the amount can be claimed by each member of the household.
To find out if you live in a prescribed northern or intermediate zone, visit the Canada Revenue Agency (CRA) Website.
Educator School Supply Tax Credit
The Teacher and Early Childhood Educator School Supply Tax Benefit was put in place to help offset the cost of classroom supplies that teachers pay for out of their own pocket.
The benefit is a 15% refundable tax credit that can be claimed on up to $1,000 of eligible teaching supplies.
Income Splitting Tax Credit
As of 2016, you will no longer be able to take advantage of the family tax, however, you will still be able to split eligible pension income with your spouse or common-law partner to reduce
Children’s Fitness Tax Credit
The Children’s Fitness Tax Credit helps to offset the cost of prescribed physical activities for your children. As of 2016, the maximum amount that a taxpayer can claim for each children’s eligible fitness costs in the year has been reduced to $500 from $1,000.
It is important to note that the additional amount of $500 for children who are eligible for the disability tax credit has not changed.
Children’s Arts Tax Credit
Similarly, the maximum eligible fees for children’s art activities has reduced from $500 to $250. The Children’s Arts Tax Credit helps offset the cost of your child participating in a program of artistic, cultural, recreational or developmental activity.
It is also important to note that the additional amount of $500 for children who receive the disability tax credit will not change
Home Accessibility Tax Credit (HATC)
For 2016 and later years, you are able to claim a credit for expenses that are incurred to make your home more accessible.
The credit is non-refundable and the expenses must be for qualifying renovations on an eligible dwelling.
New and Enhanced Services
Express Notice of Assessment (NOA)
You can now receive an instant assessment result message and NOA the next day, if you are registered for online mail and filed your tax return electronically using certified software. The message and NOA will be delivered directly to your software.
To help reduce the risk of fraud, you can now register for Account Alerts through My Account or the MyCRA mobile app. The alerts will notify you, by email, when an address or banking information has been changed and if mail, sent by the CRA, was returned.
My Account and My Service Canada Account Integration
You will now be able to access your My Account and My Service Canada Account using a single sign-in session.
MyBenefits CRA Mobile App and MyCRA Mobile App
MyBenefits is the CRA’s newest web based mobile app and allows you to securely view benefit payment dates and amounts, as well the status of your Canada Child Benefit application. You will also be able to update information about your children.
Using the MyBenefits App or the MyCRA App, you will also be able to update your marital status.
CRA’s online mail allows you to receive certain CRA correspondences online, in the CRA My Account platform, instead of receiving paper mail.
This year, additional correspondences were added to the online mail program including benefit notices and slips as well as installment reminders.
Community Volunteer Income Tax Program
The Community Volunteer Income Tax Program (CVITP) was implemented to help low income families and taxpayers with simple tax situations file their tax returns free of charge. To help even more Canadians receive the credits and benefits for which they are eligible, the CRA has recruited more volunteers.
Auto-Fill My Returns
The Auto-fill my return program helps individuals, and authorized representatives, fill out parts of their tax returns automatically, using information that is available to the Canada Revenue Agency, at the time of filing.
This year, even more tax slips were added along with extended log-in sessions and the ability to use the program for previous years.