Taxpayers who care for an elderly parent or a disabled family member have a new way to receive tax relief for that care. Originally, there were three types of credits available; the family caregiver tax credit, the caregiver credit, and the infirm dependent credit. These three credits have now been merged into one, the Canada Caregiver Credit for 2017 tax year.

To qualify the taxpayer must have in their care a dependent with physical or mental impairments. An important change with the new credit is that the taxpayer does not have to be living with the dependent in order to qualify (can be in a nursing home). Qualifying dependents may be a spouse, child, parent, grandparent, sibling, uncle, aunt, niece, or nephew. The maximum credit amount is correlated with the relationship of the taxpayer to the dependent. For example, for 2017 tax year the credit for a dependent child under 18 or a spouse is $2,150 whereas the dependent parent tax credit would be $6,883. Another important change is that the taxpayer can no longer claim a parent living with them as a dependent, unless they are infirm. Lastly, if the qualifying dependent has an income over $16,163 the credit is lowered a dollar for every dollar that is earned over that amount. 

The above information is of a general nature only and should not be relied upon for specific situations. Click here for additional tax accounting services information.  Call Marlies Y Hendricks CPA at 416-766-3941 to discuss your tax case in the event of a tax audit and to set up an appointment if you'd like professional help to represent you.