From time to time, Wheatland features events for their clients as well as the community.
For Better or Worse
Following the recent federal announcement regarding changes to the child tax credits and benefits available for families, many people are asking "how will this affect my current situation?"
Under the current setup (2014) each family receives a non-refundable tax credit of $2,255 per dependent under the age of 18. Additionally, each dependent under the age of 6 results in $100/month from the Universal Child Care Benefit Program (UCCB). In 2015, the non-refundable tax credit will be eliminated. Alternatively the UCCB will increase to $160/month for each dependent under the age of 6. Additionally, the UCCB will be expanded to provide $60/month for each dependent between the age of 6 and 18. This is a taxable benefit and is included on the lower income spouse's tax return.
So how will my family make out under these changes? Every family will see a reduction in their tax credit of $2,255/child each year for children under the age of 18 resulting in additional taxes of $338.25/child. When you look at the net tax result of this income, based on our calculations at the following tax rates, every family with children that qualify benefits from this change no matter what your tax bracket is.
|Tax Rate||Income||Net benefit from|
As this shows, the additional UCCB received after tax, is higher than the original tax savings received from the Federal Child Tax Credit of $338.25 - Overall a win for our Canadian families!
Aimee Cavanagh, CMA