The Federal Budget is in, and there are some major updates for Canadians.
On March 19, 2019, the federal government shared its fourth budget which included some new and amended tax credits for Canadians. Here are just some of the updates that will most affect Canadians’ taxes next year.
Home buyers are going to raise the roof. Get it?
The RRSP Home Buyers’ Plan used to have a withdrawal limit of $25,000, but as of March 19, 2019, it’s increased to $35,000.
Canadians are encouraged to continue their education throughout their life.
A new refundable tax credit will be introduced to help cover up to half of the tuition costs associated with training for mature taxpayers.
The way it works is that every year, Canadians will accumulate $250 into an account, and will then be able to use the funds in the account to cover up to half the cost of their tuition. Here’s an example of what that means:
Trisha is eligible to accumulate $250 annually towards tuition starting in 2019. By 2023, she has $1,000 in her account.
That year, Trisha enrolls in training and pays $1,500 in eligible tuition fees. Since she can claim up to half the tuition costs, which is $750, and she has $1,000 in her account, she can cover the maximum amount allowed, and still has $250 left in her account for any courses she takes in 2024 and beyond. She’ll continue to accumulate money in her account the following years.
Eligibility of the $250 annual credit requires that taxpayers have a working income of a minimum $10,000 and a maximum of whatever the ‘top threshold’ tax bracket is that year. For 2019 it’s $147,667.
Even though weed is legal, those with medical prescriptions can still claim the expense.
There was some speculation on how medical marijuana would be handled now that marijuana is legal across the country, but the government confirmed that those with prescriptions will continue to be able to claim the cost as a medical expense.
Extra! Extra! Read all about it.
Do you miss cracking open a newspaper at your breakfast table? Are you frustrated when you hit a paywall on an article that seems interesting? The government feels you on that. It is initiating a temporary non-refundable tax credit for eligible digital news subscriptions that allows people to claim up to $500 in subscription costs per year for a maximum tax credit of $75 annually. The outlet must belong to the Qualified Canadian Journalism Organization.
There are even more changes to taxes that could affect your filing. Visit an H&R Block office near you to learn more about other credits and deductions you might be eligible for.