Changes for 2016 tax year

Individuals and Families

Canada child benefit

Replacing Canada child tax benefit, the national child benefit supplement and the universal child care benefit. It is a tax-free monthly payment made to eligible families to help them with the cost of raising children under 18 years of age.

 

Children's arts amount

The maximum amount has been reduced to $250 to claim for your children's arts programs, such as music, dance, languages, etc.

 

Children's fitness tax credit

The maximum amount has been reduced to $500 to claim for your children's physical activity programs.

 

Home accessibility expenses

You can claim a maximum of $10,000 for the eligible expenses for a qualifying renovation of an eligible dwelling.

 

Family tax cut

The family tax cut has been eliminated for 2016 and later years.

 

Interest and Investments

Tax-free savings account (TFSA)

The amount that you can contribute to your TFSA every year has been reduced to $5,500.

 

Dividend tax credit

For "other than eligible dividends", the federal dividend tax credit for 2016 has been reduced to 10.5127% of your taxable amount of dividends reported on your return.

 

Investment tax credit

Eligibility for the mineral exploration tax credit has been extended for flow-through share agreements entered into before April 2017.

 

Other changes

Tax on taxable income

For income between $45,282 and $90,563 tax rate has been lowered to 20.5%. Also there is new bracket added for income above $200,000 with the tax rate of 33%.

 

Split income of a child under 18

The tax rate has increased to 33%.

 

Sale of principal residence

The sale of a principal residence must now be reported, along with any principal residence designation.