6 most overlooked tax deductions for GCs and Subs:
I have always believed that the best tax planning strategy is to keep as much of your hard earned dollars
as possible in your wallet. I have come across a number of tax deductions that are often overlooked or
unknown to many. I want to share with you the 6 of the most common:
RSP Contributions: Contributions into your registered savings plan are widely known but a lot of people
come to them at the end of the year when tax time is approaching. Many don't seem to understand how
much you actually get back for every dollar that you invest into your RSP. Immediately you get a tax
deduction which allows you to reduce your taxable income and optimize your savings for retirement. On
top of that, you can invest the assets and let them grow on a deferred tax basis and redeem later on at a
lower tax bracket. If you would like to know exactly how much you can get back, please visit here for a
quick calculation http://www.fundata.com/Analytics/CalculatorRRSP.aspx
OSAP Payment Interest: This one is pretty straightforward. You can claim the interest paid on qualified
government student loans. If you have not done so, you may catch up with up to five years worth of
interest payments. You may find all this info on your National Student Loans Service Centre (NSLSC)
profile online.
Working From Home costs: Many educators have been teaching remotely due to the COVID-19
restrictions. While working remotely, some teachers will have incurred costs to buy more furniture,
upgrade their subscriptions to things like digital storage, and their electricity and phone bills. If you
qualify for this, you should receive a “Form T2200, Declaration of Conditions of Employment” to be
completed and signed by your employer. You can deduct the part of your costs that relates to your work
space, such as the cost of electricity, heating, maintenance, property taxes, and home insurance.
However, you cannot deduct mortgage interest or capital cost allowance.
School Supply Credit: Some of you may be aware of the eligible educator school supply tax credit which
allows you to write off up to 15% of $1,000 of eligible teaching supplies expenses as a qualified teacher.
Teacher union dues: Most professional association fees and union fees are tax-deductible, lowering
your taxable income.
Canada Training Credit: This is not a tax deduction, but rather a tax credit to consider. The government
introduced a new refundable tax credit called the Canada training credit, which may be used for eligible
tuition and fees paid for courses taken in 2020 and subsequent taxation years. An eligible educational
institution for the purpose of calculating the Canada training credit, will be: a university, college or other
educational institution in Canada providing courses at a post-secondary level; or
an institution in Canada providing occupational-skills courses that is certified by the Minister of
Employment and Social Development.
It is important to speak with a qualified CPA or tax preparer for specific tax advice.