The federal government will be rolling out the new Canada Child Benefit (CCB) on July 20, 2016. The program is intended to put more money in the hands of families, and the federal government anticipates that under this new child benefit package most families will receive higher payments than under the old Universal Child Care Benefit/Canada Child Tax Benefit program.
Families with children under 6 could receive up to $6,400 per year per child and those with children between the ages of 6 and 17 could see up to $5,400 annually. An additional $2,730 per year per child is available to families with children who qualify for the disability tax credit.
What is it and how does it work?
The CCB is a tax-free monthly payment made to eligible families to help them with the cost of raising children under 18. Benefits are calculated based on the previous year’s income tax return, so filing a tax return every year, even if you do not have income in the year, is essential to receiving the CCB. If you have a spouse or a common-law partner, they must also file a tax return every year. Your family’s CCB payments for the coming year will be calculated each July.
Since the CCB payments are based on your family’s adjusted net income, the key to maximizing your monthly benefit payment is to ensure that you are claiming all the deductions available to you.
Examples of deductions that will reduce your family net income and help to maximize your CCB payment include: contributions to Registered Retirement Savings Plans (RRSPs), child care costs, employment expenses, moving expenses, and union dues.
If you would like to estimate how much your family will potentially receive starting July 20th use the CRA’s Canada Child Benefit Calculator.
If you are already receiving the Universal Child Care Benefit or the Canada Child Tax Benefit, or both, you do not have to reapply for the Canada Child Benefit.
To learn more about the new Canada Child Benefit, or other programs that can help you and your family, contact GB Pilley & Associates Ltd., Chartered Professional Accountants at 604 926 3522.