Financial Prep for Back-to-School: Tax Credits for Canadian Families

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As the back-to-school season kicks off, Canadian families are not only shopping for school supplies and new clothes but also bracing for the added financial pressure that comes with the start of a new academic year. Fortunately, there are a number of tax credits, deductions, and benefits available to help ease the burden.

Here’s a practical guide to the tax relief and financial supports Canadian families should be aware of as they prepare for the school season.

 

1. Canada Child Benefit (CCB)

While not a tax credit, the Canada Child Benefit remains the most significant financial support for families with children under 18. This tax-free monthly payment is based on income and family size, and is adjusted each July.

Tip: If your income has changed significantly, consider updating your information with the CRA — you may be eligible for more support sooner than next July’s recalculation.

 

2. Child Care Expenses Deduction

If you’re paying for daycare, before- and after-school care, or even day camps, you may be eligible to deduct child care expenses on your tax return.

  • Claimed by the lower-income spouse (with exceptions)
  • Children must be under 16 or have a disability
  • You must need the care to work, run a business, or attend school

Common eligible expenses:

  • Licensed child care centres
  • Babysitters and nannies (with receipts)
  • Day camps and boarding schools (limits apply)

 

3. Disability Tax Credit (DTC) & Child Disability Benefit

If your child has a prolonged physical or mental impairment, you may qualify for the Disability Tax Credit. This non-refundable credit can reduce your taxes and also open access to the Child Disability Benefit (a monthly payment on top of the CCB).

Key Steps:

  • Have a medical practitioner complete Form T2201
  • Apply early — CRA approval can take time

Bonus: You may be able to retroactively claim up to 10 years of missed DTC claims.

 

4. Registered Education Savings Plan (RESP)

While not a credit or deduction, the RESP is a powerful tool to prepare for your child’s future post-secondary education.

  • Contributions are not tax-deductible
  • Earnings grow tax-free
  • Eligible for Canada Education Savings Grant (CESG) — up to $500/year or $7,200 lifetime per child

Pro Tip: Even modest annual contributions (e.g. $2,500/year) maximize the government grant.

 

5. Provincial & Territorial Credits

Many provinces offer additional education-related tax relief or family supports. For example:

  • Ontario: Childcare Access and Relief from Expenses (CARE) tax credit
  • British Columbia: Back-to-School Tax Credit (in some years)
  • Alberta: Affordability payments (temporary measures)

Check your provincial website or ask your CPA for region-specific credits.

 

6. Post-Secondary Students: Tuition and Textbook Credits

For families with older children heading to college or university, don’t forget about:

  • Tuition Tax Credit – students receive a T2202 form from their institution
  • Transferred amounts – unused credits (up to $5,000) can be transferred to a parent or grandparent
  • Interest on student loans – can be claimed as a non-refundable credit

 

Bonus Tips for Families:

  • Keep all receipts – CRA may request proof for child care or disability-related claims
  • Update marital status – this affects CCB and other benefit calculations
  • Plan ahead – RESP withdrawals are taxable to the student (usually at a low rate), so coordinate carefully

Final Thoughts

Back-to-school season is a great time to review your family’s financial strategy. From child care deductions to RESP planning and disability credits, these opportunities can add up to real savings.

Need help navigating your family’s tax picture?

At JMH, we specialize in helping Canadian families make the most of every credit and benefit available to them. Reach out to us today for personalized advice and peace of mind this school year.

 

This blog was written using the assistance of ChatGPT.

 

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