Tax season | Why complete your tax return?

Many government assistance measures require the calculation of a person’s or household’s net income to qualify. No tax return equals no money. Think about it, especially for your adult children studying.

“When I made statements to the general public, I saw a lot of them, students who had no income and who did not make their statement. They could not defer their tuition fees or receive their solidarity credit, ”says tax expert Nicolas Godbout, today at Effisca, a specialist in personal income tax with assets in the United States and elsewhere.

Young and old who fail to complete their tax return risk leaving a lot of money on the table. See instead.

The $500 to Legault

In the 2022 budget, the Quebec government announced the payment of $500 tax-free to Quebec adults earning $100,000 or less. The check was intended to compensate for the harmful effect of inflation on the purchasing power of taxpayers. Those who filed their 2021 tax returns received it automatically. If you haven’t, it’s not too late to fix it.

Rebelote in December

The Coalition avenir Québec government kept its election promise and sent a second check in December. It was $600 for those 18 and older earning $50,000 or less and at least $400 for those earning more than $50,000 to $100,000.

If son has blown his 18 candles in the course of 2022, he is entitled to the check, confirms Tommy Gagné-Dubé, assistant professor of taxation at the University of Sherbrooke. He still needs to have completed his 2021 provincial declaration to receive it. He has until June 30, 2023 to comply.

Courtesy reminder: a taxpayer must file a provincial income tax return to be able to receive the solidarity tax credit and the credits relating to the work premium, which were improved in 2022. These credits to the work premium are are intended for workers who are not full-time students. To be eligible, the single person earns a minimum of $2,400 and a maximum of $21,490 in 2022. Up to four past years of solidarity credit can be claimed.

The federal government is no exception.

The same reasoning applies for the special GST credit paid towards the end of 2022 to offset runaway inflation. Ottawa doubled the GST credit for six months. An adult aged 19 and over, alone and without children, can receive $234. Those who had filed the federal income tax return in 2021 received the special payment automatically starting November 4. For others, producing the T1 2021 would pay off.

By filing their federal return, the taxpayer also ensures that the Canada Revenue Agency automatically verifies their eligibility for the Canada Workers Benefit (ACT) with modest working income. In 2022, a single person without children is entitled to the ACT from a work income of $2,400 up to a maximum of $29,073. Full-time students for more than 13 weeks are not eligible. From July 2023, the payment of 50% of the estimated allowance becomes automatic.

Housing allowance: less than a month left to pocket $500

Your child is studying in the city and lives in an apartment, no doubt he qualifies for the single supplement to the Canada Housing Benefit program? The measure, implemented on 1^er last December to fight against inflation, remains little known.

“It’s not in the tax as such, but it’s a good idea to talk about it,” agrees Sébastien Hamel, CPA. Anyone 15 and over earning less than $20,000 and spending at least 30% of net income on housing is entitled to a tax-free allowance of $500. For paid rent, the reference year is 2022. For earned income, it is 2021.

“This measure, like the Canadian dental benefit, has not been publicized,” laments tax expert Nicolas Godbout.

To determine the taxpayer’s eligibility, the Canada Revenue Agency will verify their age, income and residence for tax purposes. The heir requests the supplement online by going to “My file” or by telephone.

Attention ! Junior only has until March 31 to claim it. He must also have filed his 2021 federal income tax return.

Canada Learning Bond

The education bond is a measure intended for low-income families. The Canadian government pays the bond into a Registered Education Savings Plan (RESP) without the adult having to pay anything. It’s like picking up $2,000 off the sidewalk by almost bending over. The federal government pays $500 when the account is opened and $100 per year for the following years up to a maximum of 15 years.

In 2022, for the first time, a student beneficiary can open an RESP in their name and claim the Canada Learning Bond for years of eligibility, up to their 15^e anniversary. Must be 18 and under 21. Their eligibility for the learning bond will be based on their parents’ income for the relevant years. His parents must have previously submitted their tax return for the years concerned.