Understanding the Eligible Dependant Tax Credit in Canada

Eligible Dependent Tax Credit

Who Gets the Child Tax Credit in a 50/50 Custody Arrangement in Canada?

More about the Eligible Dependent Tax Credit

What is the eligible dependent credit in shared custody?Ken Maynard CDFA, Acc.FM2024-05-10T14:45:31-04:00

In shared custody, the eligible dependent credit can be claimed by only one parent each tax year. Parents need to decide or follow a legal agreement on who claims the credit each year to comply with CRA regulations.

What is the eligible dependent tax credit?Ken Maynard CDFA, Acc.FM2024-05-10T14:43:17-04:00

The eligible dependent tax credit is a non-refundable tax credit offered by the CRA to help reduce the tax burden of Canadians who support a dependent, such as a child, especially following separation or divorce. This credit is particularly significant in single-parent families.

What happens if both parents claim a child as a dependent in Canada?Ken Maynard CDFA, Acc.FM2024-05-10T14:41:50-04:00

If both parents claim a child as a dependent in Canada, it can lead to an audit by the CRA, and the duplicate claim might be denied. Parents are advised to coordinate their claims to avoid legal and financial complications.

Which parent claims a child on taxes in Canada?Ken Maynard CDFA, Acc.FM2024-05-10T14:40:27-04:00

The parent who claims a child on taxes in Canada is typically the one with whom the child lives for the majority of the year. In shared custody arrangements, parents may agree or be ordered by court to alternate who claims the child each year.

Can each parent claim a different child on taxes in Canada?Ken Maynard CDFA, Acc.FM2024-05-10T14:38:46-04:00

Yes, each parent may claim a different child on their taxes in Canada if they have more than one child, provided that each child qualifies as an eligible dependent under the CRA guidelines. This arrangement should be part of their custody agreement.

Who claims child on taxes with 50/50 custody in Canada?Ken Maynard CDFA, Acc.FM2024-05-10T14:37:17-04:00

In Canada, when parents have 50/50 custody, only one parent can claim the child as an eligible dependent on their taxes each year. The parents may decide between themselves who will claim the credit each year or follow a court order or written agreement stipulating the arrangement.

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About the Author:
Ken Maynard CDFA, Acc.FM

I assist intelligent and successful couples in crafting rapid, custom separation agreements that pave the way for a smooth transition towards a secure future. This efficient process is achieved in about four meetings, effectively sidestepping the excessive conflicts, confusion, and costs commonly linked to legal proceedings. Clients have the flexibility to collaborate with me either via video conference or in-person through a DTSW associate at any of our six Greater Toronto mediation centers, located in Aurora, Barrie, North York, Vaughan, Mississauga, and Scarborough.

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Ken Maynard CDFA, Acc.FM2024-05-10T16:29:07-04:00