You may have heard of the recent changes to the universal child care benefit (UCCB). One of the changes was to expand the UCCB, so it now applies to all children under 18, and the benefit per child under the age of 6 has been increased to $160/month.
However, there have been other changes to the taxation of Canadian parents that you should be aware of before you spend this extra benefit. As David Truman put it in The Langley Times, “These UCCB…payments are fully taxable, at rates between 20 and 45 per cent here in B.C. Furthermore, the child amount deduction of $2,255 per child has been eliminated on the 2015 personal tax return. That will cost every parent $451 in additional taxes for every child…you’d better not spend that new ‘benefit’, because you’ll have to pay back most of it next April when you file your taxes.”
Keep in mind that the increase to the UCCB and the removal of the child amount deduction will impact everyone differently depending on their tax situation. If you want to know how you will be affected by the new UCCB rules, please feel free to call our office at 250-388-4094 or email [email protected], and we will be happy to help you adapt to these changes.