It’s a New Year, Time to Start Thinking about Last Year

At this point, we are half way through the month of January, although yesterday’s weather would have you believing that it was April and you had to rush to get your personal income tax returns filed.

It is never too early to start thinking about last year.  What I am referring to is getting ready to complete your 2012 personal income tax returns.

As always, the filing deadline for most is April 30th, unless you have a sole proprietor business, then your filing deadline is June 15th, however, you have to pay any balance owing by April 30th.

When preparing your information for your accountant or for yourself, there are some new credits that you should be aware of.

Family Caregiver Tax Credit

Effective January 1, 2012, this credit is a new non-refundable tax credit is based on a $2,000 amount, and this credit will supplement either the spousal, child tax, eligible dependent, caregiver or infirm dependent credit.

The credit is available for caregivers of dependents who have a mental or physical infirmity.

Medical Expenses Tax Credit

Each year, new items are added to the list of eligible medical expenses.  For 2012, blood coagulation monitors and related supplies are now an eligible medical expense.

Children’s Arts Credit

The Children’s Arts Credit was first made available in 2011 and it is still a relatively new credit.  The credit is available, to a maximum of $500, in respect of registration or membership fees in a artistic, cultural, recreational or development activity.

In order for a program to qualify, it must be at least 8 weeks in duration or if a camp, 5 consecutive days and it must meet at least one of the following:

  • it contributes to the development of creative skills or expertise in an artistic or cultural activity;
  • it provides a substantial focus on wilderness and the natural environment;
  • it helps children develop and use particular intellectual skills;
  • it includes structured interaction among children where supervisors teach or help children develop interpersonal skills; or
  • it provides enrichment or tutoring in academic subjects.

 

Tax Free Savings Account Limit Increased

Besides the new credits mentioned above, being in 2013, the annual dollar limit for contributions to a Tax Free Savings Account has been increased to $5,500

RRSP Contribution Deadline

The deadline for contributing to your RRSP for the 2012 taxation year is Friday, March 1st, 2013.

Those are the primary changes in respect of your 2012 personal income taxes.  The Canada Revenue Agency does not begin to process personal income tax returns until mid-February, but if you have all your information together, there is nothing stopping you from filing before then, just realize that you won’t see a refund (hopefully) until mid-February.

Typically, I am always looking forward as a professional, however, during the personal tax season, I have to look in the rearview mirror to the year that was 2012.

Until next week…