.jpg)
2022/2023 New Personal Tax Measures
The Federal government has rolled out some new tax benefits for Canadians!
I am going to keep this short and have highlighted the main points here. Click through to read more and as always, contact us should have any questions.
A quick note: Refundable vs. Non-refundable tax credit. The latter means that the credit can only be applied against your taxes otherwise payable. A Refundable credit means that if you have any left over after paying your tax bill, that you will get a refund of cash back.
If these apply to you, DO let us know when we are preparing your personal tax filing!
Changes in Effect for 2022
First-Time Home Buyer's Tax Credit (link)
- for homes purchased on or after January 1, 2022
- increase in non-refundable tax credit to $10,000 (x 15% = $1,500 credit) from $5,000
Home Accessibility Tax Credit (link)
- applies for 2022 and future tax years
- non-refundable tax credit for eligible home renovation expenses
- for persons eligible for the disability tax credit or 65 and over
- expense limit increased to $20,000 (x 15% = $3,000) from $10,000
Labour Mobility Deduction (link)
- applies to 2022 and future tax years
- for certain travel and relocation expenses for workers in construction industry
- eligible temporary relocation for employment in construction in Canada
- away for at least 36 hours, 150km closer to worksite
- deduction up to $4,000 in eligible expenses for the year, to a maximum of 50% of related
employment income
Medical Expense Tax Credit (expansion for surrogate or donor) (link)
- effective for 2022 and future tax years
- broader definition of a “patient” where relying on a surrogate or donor
- eligible medical expenses can be claimed in respect to a surrogate mother or donor
- includes fees paid to fertility clinics or donor banks
- incurred in Canada according to the Assisted Human Reproduction Act
Canada Dental Benefit (link)
- tax-free, up-front payment
- for child that does not have access to private dental insurance
- for child under 12 as of:
(a) Dec.1, 2022, for dental care performed between Oct.1/22 and June 30/23, and
(b) Jul.1/23, for dental care performed between Jul.1/23 to June 30/24
- eligible families earning less than $90,000 per year receive a tax-free payment for each eligible child based on adjusted net income:
o $650 per child for families under $70,000
o $390 per child for between $70-$79,999
o $260 per child for between $80-$89,999
- maximum two payments per child with the two benefit payments available
- if you received CCB (partial or full), then you may apply to receive this benefit
- 2021 tax return must have been filed
Canada Housing Benefit (link)
- one-time tax-free payment of $500 to lower-income renters with adjusted net income of $20,000 (single) or $35,000 (family), who pay at least 30% towards rent
- application opened Dec.12, 2022
- must have filed a 2021 tax return
- apply through My Service Canada account or phone 1-800-282-8079
Changes in Effect for 2023
Multigenerational Home Renovation Tax Credit (link)
- applies for work performed or paid on or after January 1, 2023
- refundable tax credit for eligible expenses for a qualifying renovation
- for a self-contained secondary unit for an eligible person (senior or disabled person)
- maximum $50,000 in eligible expenses (x 15% = $7,500 credit)
- need building permits, final inspection
- more guidance from CRA to come
Tax-Free First Home Savings Account ("FHSA") (link)
- new registered account, applies for 2023
- contributions are deductible to a maximum of $8,000; lifetime maximum $40,000
- qualifying withdrawals non-taxable
- cannot use Home Buyer's Plan and FHSA together
GST/HST on Assignment Sales by Individuals (link)
- applies for any assignment on or after the day that is one month after April 7, 2022
- currently, an assignment sale of newly constructed/substantially renovated residential housing may be exempt if the property is to occupy the home
- all assignments now taxable for GST/HST
Residential Property Flipping (link)
- applies for properties sold on or after January 1, 2023
- profits from sales of real estate, including rental, owned less than 12 months are now
fully taxed as business income (not capital gains) – loss treatment does not apply
- no principal residence exemption, no capital loss on Personal Use Property
- exceptions apply (eg. death, disability, illness, marital status, employment, etc.)
- more guidance from CRA to come