Seniors tax tips
Seniors: We’ve got tips to help you this tax season!
As a senior, here are some of the most common things that you could claim on your income tax and benefit return at tax time:
- Pension income splitting – As a pensioner, you may be eligible to split up to 50% of your eligible pension income with your spouse or common-law partner to reduce the amount of income tax you may have to pay, if your spouse or common-law partner is in a lower tax bracket. This may save you tax as a couple.
- Registered retirement savings plan deduction – Deductible contributions to your plan can reduce your tax owing. You have until December 31 of the year in which you turn 71 to contribute to your plan.
- Medical expenses – You may be able to claim eligible medical expenses you or your spouse or common-law partner paid in any 12-month period ending in 2017. This period is extended to 24 months in case of death.
- Age amount – If you were 65 years of age or older on December 31, 2017, and your net income was less than $84,597, you may be able to claim up to $7,225 on your return.
- Disability tax credit – If you, your spouse or common-law partner, or your dependant have a severe and prolonged impairment in physical or mental functions, you may be eligible for the disability tax credit. To apply for this credit, you must have Form T2201, Disability Tax Credit Certificate filled out and certified by a medical practitioner. Once the CRA approves your form, you can claim the disability amount on your return.
- Canada caregiver credit – This credit replaces the family caregiver credit, the credit for infirm dependants age 18 or older, and the caregiver credit. If you have a spouse or common-law partner or a dependant with an impairment in physical or mental functions, you may be able to claim this non-refundable tax credit.
- Pension income amount – You may be able to claim up to $2,000 if you reported eligible pension, superannuation, or annuity payments on your return.
Also, filing a tax return is the easiest way to access credit and benefit payments that may assist seniors, such as:
- Guaranteed income supplement – If you live on a low-income and receive the guaranteed income supplement or allowance benefits under the Old Age Security Program, you must file your taxes by April 30 to make sure your benefits get renewed.
- Goods and services tax / harmonized sales tax (GST/HST) credit – You may be eligible for tax-free quarterly payments that help individuals and families with low and modest income offset all or part of the GST or HST that they pay. If you have a spouse or common-law partner, only one of you can receive the credit. When you file your taxes, the CRA automatically determines your eligibility.
- Registered disability savings plan – This type of plan helps Canadians with disabilities and their families save for the long-term financial security of a person who is eligible for the disability tax credit. Contributions to such a plan are not tax deductible, but you can make them until the end of the year in which the beneficiary turns 59.
Go to canada.ca for more information about seniors programs and services from the CRA.
Register for direct deposit and file online
You can register for direct deposit and file online to get any refund you may be eligible for faster. To file online, the CRA has a list of certified tax software products that are easy to use, fast, and secure, some of which are free!
Electronic returns are generally processed within two weeks. Individuals who file online and are registered for direct deposit may get their refund in as little as eight business days. However, for paper returns, our service standard is to process them within eight weeks of receipt.
Climate action incentive payment
The Climate action incentive payment (CAIP) is a tax-free amount paid to help individuals and families offset the cost of the federal pollution pricing. You may be eligible for the CAIP if you are a resident of Alberta, Saskatchewan, Manitoba, or Ontario.
To get the CAIP, you and your spouse or common-law partner (if applicable) must each file an income tax and benefit return for the year and be an eligible individual. The CRA will automatically determine your eligibility when you file your return. If you have a spouse or common-law partner, only one of you can get the CAIP for the family. The CAIP will be paid to the spouse or common-law partner whose return is assessed first. No matter which one of you receives the CAIP, the amount will be the same.
If you are eligible to receive the CAIP, we recommend that you and your spouse or common-law partner (if applicable) file your 2022 returns electronically by March 10, 2023, to help in receiving the April 14, 2023, issuance. If you don’t receive the April issuance, the payment will be included in a subsequent payment after your return is assessed.
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