Although 2017 didn't bring major tax changes, here are some updates that may help you save money. We've highlighted what's changed, and also included some helpful reminders and tips to make tax filing easier for 2017.
First Time Donors to Charity
- 2017 is the last tax year that you can claim the Federal First-Time Donor's Super Credit (FDSC). This super credit gives you a one-time additional 25% tax credit for monetary donations of up to $1,000. But you can only claim the FDSC if neither you nor your spouse or common-law partner has claimed the regular donation tax credit between 2008 and 2016.
- For the 2017 tax year, the family caregiver amount, the amount for infirm dependents age 18 or older, and the caregiver amount have all been consolidated and replaced by the new Canada caregiver credit (CCC). You can claim the CCC if you care for your spouse or common-law partner, minor child, or other eligible relative who is dependent on you because of a mental or physical infirmity.
- The maximum dollar limit for 2017 for contributing to your Retirement Savings Plan (RSP) is $26,010. However, check your Notice of Assessment or log into the Canada Revenue Agency's (CRA) My Account to determine your personal available contribution room for 2017. If you want to deduct your contribution in the 2017 tax year, make your contributions by March 1, 2018.
Indexing to Inflation
- Every year, non-refundable tax credits and federal income tax brackets are indexed to inflation. The 2017 indexation increases, which are based on the Canadian Consumer Price Index, were 1.4%. That means the basic personal amount, the amount you can earn without paying any federal income tax, has increased to $11,635 in 2017. At the other end of the spectrum, the top federal tax bracket of 33% kicks in at taxable income over $202,800.
- The Canada child benefit, which provides up to $6,400 per child under the age of 6, and up to $5,400 per child aged 6 to 17, will be indexed starting July 2018.
Don't Forget New Tax Credits Introduced in 2016
- Teachers and early childhood educators paying expenses out of their own pockets can claim the Eligible Educator School Supply Tax Credit for up to $1,000 of teaching supplies like construction paper, art materials, pens, pencils, books, games, containers, materials for science experiments, etc. The credit is worth up to $150.
- The home accessibility tax credit lets both seniors and disabled taxpayers claim up to $10,000 of qualifying home renovations to make your home safer or more accessible for you, your spouse or common-law partner, or other qualifying family members you support.
- The public transit tax credit was eliminated on July 1, 2017, so you can only claim the cost of eligible public transit expenses for travel taken in the first 6 months of 2017.
Less Work for You
- If you use certified tax software to prepare your return, it'll be updated with the latest tax changes. It'll also allow you to file online quickly, accurately, and at your convenience, and receive any refund you may be owed in a matter of days.
- Using Auto-fill my return allows the CRA to instantly transfer the most accurate and up-to-date tax information they hold, such as from T4 and RSP slips, directly to the proper places in your tax return.