How to file old tax returns canada
Filing Income Tax Returns For Your Children and University Students
Michael James recently posted an excellent blog on why parents should file income tax returns for their children (or better yet, have their children actually try and file their own returns). The blog mentions several good reasons for filing and I suggest you read that particular blog. If you do not read Michael's blog, I recommend you do so. Michael digs down deep for practical tips and it feels like he has exeprienced first hand almost everything he writes about.
I agree wholeheartedly with the reasons Michael sets forth for filing a return for your child, or more specifically, your university aged child. However, as an accountant, it is always $signs that matter and I wish to add a couple other reasons for filing (Michael, thanks for the permission) that will result in cash in yours or your child's pocket, especially for children 19 years of age and older.
The Goods and Services Tax/Harmonized Sales Tax credit will pay $250 to low income earners 19 years of age and older. The credit is generated by the filing of a tax return and should be filed by those 18 years of age or older (file when you are 18,
so the credit will be received when you are 19). For dependants under 19, the parents may benefit by the credit and their child filing a tax return. For those inclined, the following worksheet will allow you to calculate your entitlement to the credit.
In addition to the Goods and Service Tax/Harmonized Sales Tax credit, in Ontario there is a $260 Ontario sales tax credit. The eligibility rules for the Ontario Sales Tax Credit are the same as those for the GST/HST Tax credit.I have not delved into the credits allowed in the other provinces, but there are definitely credits available in other provinces.
Finally, again in Ontario, there is an Ontario Energy and Property Tax Credit where your child is over 18 and has paid rent in Ontario (sorry Ontario students attending UBC, McGill etc.). There is also a small $25 student residence credit that makes you wonder why Ontario even provides such.
To reiterate one of Michael's points; tuition, education and textbook credits that cannot be transferred to a parent or grandparent, will be available to reduce future income tax on future earnings, most likely in the year your child becomes employed full-time, so ensure your children files to establish these credit carryforwards.
Today’s MusicSource: www.thebluntbeancounter.com