The Children’s Arts Tax Credit: Use It Before You Lose It

  • the non-refundable children's arts tax credit

The Children’s Arts Tax Credit (CATC) is a non-refundable tax credit.  It aims to foster a child’s artistic, cultural or developmental advancement, while at the same time providing some tax relief to the parents who pay the fees.

Even though this credit includes the word “Arts” in its name, eligible programs are not just limited to those in the cultural or artistic fields.  In fact, unlike its sister program, the Children’s Fitness Tax Credit, the CATC is quite varied.  Eligible activities include the following:

  • those that foster the development of creativity and encourage cultural or artistic abilities (e.g. music, languages, literature, performing arts, visual arts);
  • those that provide focus on nature and the environment (ie. camps)
  • those that encourage a child’s development and use of intellectual skills (e.g. chess, public speaking, computers);
  • those that facilitate structured interaction between children and help in the advancement of their interpersonal skills (e.g. Girl Guides, Scouts); and
  • those that aim to enhance knowledge in academic subjects (e.g. tutoring).

The CATC is available at both the federal and provincial levels.  Eligible children must be 16 years or younger at the start of the tax year.  However, if the child also qualifies for the Disability Tax Credit the age limit rises to 18.  Also, in order to be valid, a program must:

  • not be a part of a school’s curriculum;
  • be supervised;
  • be appropriate and suited for children; and
  • be ongoing (either offered for a minimum of once a week for at least 8 consecutive weeks, or 5 consecutive days).

Parents can claim non-refundable tax credits of 15{cae2521f64dcff784c511b644c6cc8c98f9594c79acdd41ba953a724385391e5} federally (up to $250) and 5.06{cae2521f64dcff784c511b644c6cc8c98f9594c79acdd41ba953a724385391e5} provincially (up to $500) on qualifying fees paid per child during the year.

The federal Children’s Arts Tax Credit permits the parents to claim a 15{cae2521f64dcff784c511b644c6cc8c98f9594c79acdd41ba953a724385391e5} non-refundable tax credit on up $250.00 of qualifying fees paid per child during the year.   The provincial credit varies depending where in Canada you live.  For BC families, a 5.06{cae2521f64dcff784c511b644c6cc8c98f9594c79acdd41ba953a724385391e5} non-refundable credit can be claimed per child to a maximum of $500.00.  An additional $500.00 can be claimed at both the federal and provincial levels for children with disabilities.

The expenses can be claimed by either parent, but be sure to ask for and retain receipts for all eligible CATC expenses.  You will not be required to submit these supporting documents with your return.  However, should the CRA need to verify your claim you will need to produce them.

The CATC will be eliminated in 2017.  If you have any eligible expenses that fall within this program, be sure to claim them before it is phased out.

If you would like to learn more about the Children’s Arts Amount Tax Credit, or other Child Care Expense programs, like the Children’s Fitness Tax Credit, that can help you and your family, contact GB Pilley & Associates Ltd., Chartered Professional Accountants at 604 926 3522.

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2016-12-28T15:00:19+00:00