How to Claim your Child Care Expenses

March 11, 2013

​If you are working or going to school and have someone else caring for your children, you can claim those costs on your taxes as a deduction from your total income, thereby reducing the amount of tax you have to pay on your net income.

As long as your child or children are under 16 years of age, the parent with the lower net income can claim the child care expenses paid as a deduction on their taxes. In order to make this claim, you must have a receipt to support this claim, whether you are required to submit it or not. The receipt needs to list the caregiver’s name , SIN , and amount paid for child care through the year. If your caregiver refuses to provide this information, you cannot make the claim; if you do and cannot provide receipts to support the claim, CRA will reject the claim.

Many Canadian families use family members for childcare. If an adult family member (i.e. mother, mother-in-law, etc.) is providing care and you pay her, you can claim that expense on your taxes as long as you have a receipt with her SIN; however, she must claim this as income earned on her taxes as well. On the other hand, if you pay a minor to care for your children, such as your 13-year old niece, you cannot claim this as a child care expense.

As per the 2012 General Income Tax and Benefit Guide put out by Canada Revenue Agency, ‘only the spouse or common-law partner with the lower net income (even if it is zero) can claim these expenses’. There are some exceptions, but we recommend you contact a CRA representative or your family accountant to confirm. This includes if the mother is presently on maternity leave and earning benefits being considered the lower income earner.

If eligible, enter your child care expenses on line 214 of your federal tax return.

As you may know, you can also make claims under the Children’s fitness amount, on line 365. If your child attends summer camp, or something similar that provides child care as well applies for the fitness amount, you need to ask the provider for a detailed receipt, as you can only claim the child care portion of this expense.

For more on this topic: - Nanny Tax & Payroll provides this for informational purposes only. Any specific tax questions should be directed to a tax professional or your family accountant. For help with managing your nanny's payroll, check out the Nanny Tax & Payroll Services! Nanny Payroll & Tax service is powered by HeartPayroll

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