If you have clients with children in British Columbia, the province has a number of credits designed just for families. Consider talking with your clients about the following programs.
Early Childhood Tax Benefit
Families with children under the age of six may qualify for the Early Childhood Tax Benefit. Worth up to $55 per month per child, this benefit gets sent to qualifying families along with their Canada Child Benefit. Surprisingly, this benefit is not just for low-income families. If your clients earn up to $100,000, they can claim the full credit, and they can even get a partial credit if their income falls between $100,000 and $150,000.
If your client has already applied for the Canada Child Benefit, you don’t have to do anything else. They will automatically receive this payment. If they haven’t applied yet, they can apply using the Canada Revenue Agency’s online My Account service or with Form RC66 (Canada Child Benefits Application) through the mail.
Low-Income Climate Action Tax Credit
This B.C. tax credit helps to offset the cost of carbon taxes. It’s available to families with children as well as to individuals over the age of 19 or anyone with a spouse or common-law partner. But only one person per family can receive the credit. As of 2018, the credit is worth $135 for an individual. Your clients can receive another $135 for their spouse or common-law partner and $40 per child. If your client is a single parent, they can receive $135 for their first child.
As of 2018, your individual clients can claim this credit if they earn up to $33,993 per year, and couples or single parents can earn up to $39,658 per year to qualify. Luckily, your clients don’t need to apply for this credit. Eligibility is determined automatically based on their tax returns, and they receive the payment quarterly with their GST rebate.
Child Care Fee Reductions and Benefits
The B.C. 2018 budget brought in additional benefits for families, and you should make sure your clients are taking advantage of these child care programs as well. As of April 2018, there is a fee reduction for child care costs. Families can’t apply for this credit on their own. Instead, their child care provider needs to apply. The benefit gets sent directly to the child care provider, and then your clients should see a reduction in their fees. The benefits are worth the following amounts:
- $350 per month for infants and toddlers in group daycare
- $200 per month for infants and toddlers in family care
- $100 per month for three-year olds to kindergartners in family care
- $60 per month for three-year olds to kindergartners in family care
Additionally, as of September 2018, your clients may qualify for an affordable child care benefit. This applies to families with incomes up to $111,000. Once the program is active, your clients can apply online, but the program is being phased in slowly. During 2018 to 2019, only families with children in licenced infant or toddler care qualify, but the following year (2019 to 2020), the benefits expand to families with three- to five-year olds. You may want to check for updates from the provincial government to learn more about the value of this benefit and other details.
While helping your clients make the most of these credits, you may also want to talk with them about business credits. Remember, the more credits and deductions you help your clients find, the more valuable you become as their accountant.