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Hi there,
I had my taxes done yesterday, and my accountant mentioned to me that he is currently "writing an amendment" to the Ontario Tax Act with regards to the Childcare Tax Credit and families where one parent has been deployed.
I am not completely familiar with the particulars regarding the tax credits and deductions, as my kids are no longer in daycare - however I thought I would mention this in case it is of interest to anyone else.
Specifically he is addressing situations where the tax excempt portion of the deployed member's pay causes their taxable income to be lower than that of their spouse's (sometimes it's zero if the member is on a 9 month deployment with other deductions).
According to the act, the childcare credit must be deducted from the parent with the lowest taxable income. In these afore mentioned cases, it is the military member.
My understaning is, that this means the other spouse, who may normally have a lower taxable income, cannot benefit from this deduction, and may end up owing taxes as a result.
As I said - I am not entirely sure how often this occurs or the full extent of how it can negativly affect one's taxes - but I thought it was cool that someone was looking at making it better for military families who are affected.
muffin
I had my taxes done yesterday, and my accountant mentioned to me that he is currently "writing an amendment" to the Ontario Tax Act with regards to the Childcare Tax Credit and families where one parent has been deployed.
I am not completely familiar with the particulars regarding the tax credits and deductions, as my kids are no longer in daycare - however I thought I would mention this in case it is of interest to anyone else.
Specifically he is addressing situations where the tax excempt portion of the deployed member's pay causes their taxable income to be lower than that of their spouse's (sometimes it's zero if the member is on a 9 month deployment with other deductions).
According to the act, the childcare credit must be deducted from the parent with the lowest taxable income. In these afore mentioned cases, it is the military member.
My understaning is, that this means the other spouse, who may normally have a lower taxable income, cannot benefit from this deduction, and may end up owing taxes as a result.
As I said - I am not entirely sure how often this occurs or the full extent of how it can negativly affect one's taxes - but I thought it was cool that someone was looking at making it better for military families who are affected.
muffin
