If you are a Canadian taxpayer, you may be eligible for several tax credits and deductions, including the Dependant tax credit. This credit is designed to help individuals who provide support to a dependant family member who is either physically or mentally impaired.

In this blog post, we will cover everything you need to know about the Dependant tax credit, including eligibility criteria, how to claim it, and the associated benefits.

Eligibility Criteria for the Dependant Tax Credit

To be eligible for the Dependant tax credit, the following criteria must be met:

  1. The dependant must be your child, grandchild, parent, grandparent, brother, sister, uncle, aunt, nephew, or niece.
  2. The dependant must have a mental or physical impairment.
  3. The dependant must rely on you for support.
  4. The dependant must be a resident of Canada or deemed to be a resident of Canada.
  5. You must be a Canadian taxpayer.

It is important to note that the CRA may request medical documentation to verify the dependant’s impairment.

How to Claim the Dependant Tax Credit

To claim the Dependant tax credit, you need to fill out Schedule 5, “Amounts for Spouse or Common-Law Partner and Dependants,” and attach it to your tax return. You can claim up to $12,421 for each eligible dependant.

Benefits of the Dependant Tax Credit

The Dependant tax credit can provide significant tax relief for individuals who support a dependant family member with an impairment. It can reduce the amount of federal tax you owe, resulting in a lower overall tax bill.

In addition, the Dependant tax credit is a non-refundable tax credit. This means that if the credit amount exceeds your tax payable, you will not receive a refund for the difference. However, any unused credit can be carried forward to future years, providing additional tax relief.

Conclusion

If you are a Canadian taxpayer who supports a dependant family member with a mental or physical impairment, the Dependant tax credit can provide significant tax relief. By understanding the eligibility criteria and how to claim the credit, you can maximize your tax savings and ensure that you are receiving the benefits you deserve.