Who doesn't want the lowest tax-bill possible? One way to reduce yours is to make sure you capture all possible tax deductions.
Below are the most commonly forgotten tax deductions, like student loan interest, childcare expenses, and other things which remind you that you're definitely an adult now 😒.
If these apply to you, make sure you include them in your tax return this year.
1. Childcare Expenses
If you pay for childcare so you can work, attend school, or run a business, make sure to deduct these expenses. Eligible deductions include daycare, in-home help, overnight camps, summer day camps, and certain educational programs. Learn more here.
2. Medical Expenses
A medical expense tax credit (METC) can be claimed when the out-of-pocket medical expenses for you, your spouse and your children exceed the lesser of 3% of your net income or $2,302 in 2018. Eligible expenses include dental visits, prescriptions, doctors' fees and transportation costs for medical care that requires more than 40km of travel. Maximize your return by having one family member make all of the claims. Learn more here.
3. Interest on Student Loans
If you are paying back a student loan, be sure to deduct the interest payments for the year. If you missed this deduction previously, you can claim any unclaimed interest within the last 5 years. Not all loans are deductible (unfortunately lines of credit aren't), so be sure to check whether your loan qualifies. Learn more here.
3. Professional Dues and Exam Fees
Such expenses include professional fees, business insurance fees, certification exams and licensing fees that are required for your profession. These expenses are only eligible if you're not reimbursed by your employer. Learn more here.
4. The Costs of A Work-Related Move
If you switch jobs and are moving to be at least 40km closer to work, you can claim your moving expenses. Moving expenses include vehicle expenses, accommodation and meals for your family during the move, title transfer, utility hook-ups and any address-change fees you incur on identification or other documents. Learn more here.
5. Home-Related Work Costs
If you work from home or are self-employed, you may be able to claim certain expenses if you do more than 50% of your work there or the space is only used for work-related business. This may include your rent, utilities and heating costs. If you're an employee your employer must sign a T2200 form, approving the expenses as necessary for your job. Employees learn more here and self-employed individuals learn more here.
6. Vehicle-Related Work Costs
If you use a vehicle for employment, certain expenses such as gas, insurance and vehicle payments can be deductible. Your eligible deductions are based on the % of total kilometres driven to earn income vs. for personal use, so keep track of both your total and work-related kilometres driven (here's a handy app to do so).
If you're not sure whether an expense is deductible, check!
Generally, personal expenses aren't deductible, but those which are necessities for work, health, or family reasons have a chance of being tax-deductible.
To conquer tax season, check out these articles:
Part 1 - RRSP Contributions
Part 2 - Filing Your Taxes
Part 3 - What to Do With Your Tax Refund/ Taxes Owed