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Taking care of aging parents can be a challenging and rewarding experience. In Canada, there are several tax benefits available to children who are caring for their aging parents. These benefits can help offset some of the costs associated with caregiving and make it easier for families to provide the care their loved ones need.
We recommend talking to your or your parent’s financial advisor or accountant to see if your family can benefit from any of the following tax credits.
The Canada Caregiver Credit
The Canada Caregiver Credit is a non-refundable tax credit that provides tax relief to individuals who are caring for a spouse, common-law partner, or dependent with a physical or mental impairment. The maximum amount of the credit is $7,276 for a spouse or common-law partner or an eligible dependent 18 years of age or older. The maximum amount of the credit is $2,273 for an eligible dependent under 18 years of age.
Click here for more information about the Canada Caregiver Credit.
Claiming Medical Expenses of Aging Parents
If you are caring for an aging parent and paying for their medical expenses, you may be able to claim those expenses on your tax return. Eligible medical expenses include payments made to a medical practitioner, dentist, nurse, or certain other medical professionals. The expenses must have been paid within any 12-month period ending in the current tax year and must not have been claimed by anyone else. There is no maximum amount that can be claimed for eligible medical expenses.
Click here for more information about claiming medical expenses on your tax return.
The Disability Tax Credit
The Disability Tax Credit (DTC) is a non-refundable tax credit that helps people with impairments, or their supporting family member, reduce the amount of income tax they may have to pay. If you have a severe and prolonged impairment, you may apply for the credit. If you are approved, you may claim the credit at tax time. By reducing the amount of income tax you may have to pay, the DTC aims to offset some of the extra costs related to the impairment. The maximum amount of the credit is $8,576.
Click here for more information about the Disability Tax Credit.
The Home Accessibility Tax Credit
The Home Accessibility Tax Credit (HATC) is a non-refundable tax credit for eligible home renovation or alteration expenses that allow a qualifying individual to gain access to, or to be mobile or functional within the eligible dwelling or reduce the risk of harm to the qualifying individual within the dwelling or in gaining access to the dwelling. For the 2022 and subsequent taxation years, the Budget proposes to increase the annual expense limit of the HATC from $10,000 to $20,000. This may allow a taxpayer to claim a tax credit of up to $3,000.
Click here to learn more about the Home Accessibility Tax Credit.
The Multi-Generational Home Renovation Tax Credit
The Multi-Generational Home Renovation Tax Credit is a refundable credit that assists with the cost of renovating an eligible dwelling to establish a secondary unit that enables a qualifying individual (a senior or an adult who is eligible for the disability tax credit) to live with a qualifying relation. The value of the credit is 15% of the lesser of qualifying expenditures and $50,000. This means that taxpayers can claim up to $7,500.
Click here to get more information about this new tax credit introduced in Budget 2022.
Want to Learn More?
ConsidraCare’s caregivers for seniors are trained to offer professional support and companionship to seniors. Please reach out to us at wecare@considracare.com or call us at 1-855-410-7971.
FAQs:
1. Can you claim elderly parents as dependents in Canada?
Yes, you may be able to claim your elderly parents as dependents in Canada if they meet certain criteria. This includes having a net income of less than $12,421, being a resident of Canada, and being dependent on you due to mental or physical infirmity.
2. Is there a caregiver tax credit in Canada?
Yes, there is a caregiver tax credit in Canada. It is called the Canada Caregiver Credit (CCC) and it provides tax relief to individuals who have a spouse, common-law partner, or dependent with a physical or mental impairment.
3. Can I get paid for taking care of my elderly mother in Canada?
There are some programs in Canada that provide financial assistance to individuals who are caring for an elderly family member, such as the Canada Pension Plan (CPP) caregiver benefit. However, in most cases, family members are not paid for providing care to their loved ones.
4. What is the income limit for caregiver credit in Canada?
There is no specific income limit for the Canada Caregiver Credit in Canada. However, the credit is reduced as the dependent’s net income increases. If the dependent’s net income is greater than $23,046, the credit will not be available.
5. What is the eligible dependent tax credit in Canada?
The Eligible Dependant Credit is a tax credit in Canada that is available to individuals who are supporting a dependant. The dependant must be single, widowed, divorced, or separated and must have a net income of less than $12,421.
