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5 tax breaks you may not know about
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Now that tax season is underway, it’s time to look over your financial records from last year and determine your options for reducing your tax liability. You should pay what you owe, of course, but why pay more than you need to?

We’ve also just passed the season for that well-known Canadian tax deduction: the registered retirement savings plan (RRSP). In the first two months of the year, many Canadians rush to their financial advisors or banks to put money into their RRSPs to get a tax deduction for the previous tax year.

There’s no doubt: Contributing to an RRSP is a great way to lower your tax bill. But the tax code is large, and you might not be aware of all the other options you may have to pay less income tax. This year, go beyond the common tax breaks you know and consider some of the others you might be eligible for.

Children’s arts amount (Line 370)
If you pay for your children to be involved in developmental, cultural, or artistic activities, you might be eligible for a tax credit. According to Mike Oseen, Senior Tax Manager at Grant Thornton LLP, this tax credit means effectively 15% of the activity fee is treated as tax paid.

For the children’s arts amount, you can take a credit of up to $500 per child for the cost of registration or membership in the activity. This applies to your spouse’s child, or your common-law partner’s child, as well as your own.

Children’s fitness amount (Line 365)
Not only are you encouraged to boost your children’s achievements in the arts, but you are also encouraged to help your child live healthier. The children’s fitness amount is a tax credit that applies to fees paid for participation in sports or some physical activity. Once again, you can claim up to $500 per child, for your child or your partner’s child.

Home-buyers’ amount (line 369)
Did you buy a home last year? If so, you might be eligible to claim up to $5,000 as a tax credit. To do so, you have to meet both the following conditions:

  1. The home you bought qualifies for the credit. (Find out if you have a qualifying home.)
  2. You didn’t live in another home you or your partner (spouse or common-law) owned last year or in any of the four preceding years.

The idea is to encourage first-time home buyers. If you have a disability, though, you don’t have to be a first-time buyer. (See persons with disabilities.)

Public transit amount (line 364)
Your efforts to be a little greener as you get to work can result in another tax advantage. If you buy monthly or annual passes for travel within Canada on qualified public transit, you can get a tax credit for what you spent last year.

Moving expenses (line 219)
Did you move to be closer to work? If so, you might be able to get a tax break for your expenses. You could be eligible for this advantage if one of the following applies to you:

  • You moved to be closer to your employer
  • You moved to carry on a business at a new location
  • You moved to study as a full-time student at a qualified post-secondary institution

You do have to move at least 40 kilometres closer to your new workplace (either a different location of your current employer or a new employer) or school to qualify, though. Eligible moving expenses include packing and moving your household goods, the cost of selling your old home, and utility hook-ups and disconnections.

Moving expenses are a little different from the other breaks mentioned in that they are a tax deduction as opposed to a tax credit (they reduce the amount of income you pay tax on, whereas a tax credit reduces the amount of tax you owe).

Consider your situation and think about what you spent last year. Check with the Canada Revenue Agency or a trusted tax preparer if you aren’t sure if you are eligible for these tax breaks.


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Original source: Five tax breaks you may not know about, written by Jim Yih for BrighterLife.ca © Sun Life Assurance Company of Canada, 2013.

Comments | Tagged under money, advice, taxes
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6 Ways to Save On Organic and Good-for-You Food
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We all want to live well—but those impending costs at the organic store’s cash register can be hard to swallow.

It may be discouraging to think that 1,000 calories of junk food costs $1.76 compared with $18.16 for 1, 000 calories of the healthy stuff, according to a 2007 University of Washington study. Still, the benefits of eating healthy are insurmountable.

If you want to have your organic veggies and eat them too, consider these six ways to eat healthy on a slim budget:

Cut out the middleman
If you’ve ever been to a local farmers’ market, you’ll see truckloads of produce, exuberant children chasing after one another in a game of tag, and local merchants lining makeshift aisles, some of them timidly glancing in your general direction from time to time. That’s because most farmers are not born and bred salespeople—they’re producers. That isn’t to say they don’t want your business. Make connections with local producers and offer to pick up their products on a regular basis for an agreed-upon amount of money. By reaching out, you have a pretty good chance of scoring a decent deal on what they can offer you.

Don’t be a victim of labelling
While food labels are typically in place to help consumers understand what they’re purchasing, there are certain labels out there that hold no validity through the legal system or otherwise. In short, these words will make you feel better about buying the product, but they may not necessarily be better for you. According to Bicycling.com, the following terms don’t necessarily hold any weight in the context in which they’re used: natural, free-range, cage-free, antibiotic-free, chemical-free, hormone-free, rBGH-free, eco-safe, environmentally friendly, and green. Beware the lure of the label.

Soup, soup, soup
You’ve heard it before and we’re telling you again: water is the key to one’s well-being. When you buy organic meats and vegetables, you can increase how far the food (and nutrients) go when you turn that meal into a broth. While this is a great way to cut costs on meals, it’s also much healthier for you. When you heat your food, you destroy more than 30 percent of that food’s nutrients. But since water has the capability to absorb those forgotten nutrients, soup is your key to locking in many of those vital ingredients.

Juice, juice, juice
Similarly, juices also serve as a way to lock in nutrients. Your body naturally loses many of the nutrients in food during the digestive process. It takes a lot of energy to break down food. By juicing, you’re able to retain many of those nutrients, much more of your energy, and since much of that mass is water, you’re cutting costs on food yet again.

Inspire a community garden
It doesn’t get more inexpensive than doing-it-yourself. Inspire a community garden that everyone on the block can contribute to and take advantage of. You can plant potato sprouts, avocado pits, seeds from fruits, and all sorts of things you’d otherwise be disposing of in the trash. What a waste (literally) to not do it! Furthermore, you can apply for grants to help fund your community garden project. Check out Evergreen.ca or other local funding programs to find out how.

Become part of a co-op
Take a stroll through your neighbourhood—chances are you’ll stumble upon a co-op food store. In the smaller scheme of things, you can volunteer your time in exchange for co-op member-only prices on organic food. In the grand scheme of things, your time and support may help spark a larger movement that could one day change the way your grandchildren source and eat food. In both cases, the outcome leaves you feeling richer.

So it comes down to this: eat well or eat cheap. Or, look for ways to curb costs while enjoying a happy, healthy, and wealthy lifestyle. After all, living well should encompass living well within our means, too.

 

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