The Canada Revenue Agency (CRA) has very clear rules on what constitutes a
“couple” when filing your tax return. If you are married, it’s usually
pretty straightforward. But if you’re not and are living together, are you
eligible for any tax breaks under a common-law designation? You are
considered common-law in the following circumstances:
* If you live together continuously for 12 months or more (separations of
less than 90 days don’t count).
* If you have a child together (by birth or adoption), you are considered
common-law as soon as you move in together.
* If you have custody and control over your child, and he or she is wholly
dependent on your partner for support.
If you meet any one of these criteria, you must inform CRA when you become
common-law, and file Form RC65 – Marital Status Change.
Whether you are living together common-law or are married, you can pool
receipts such as medical expenses, charitable donations, and public transit
passes to maximize your credits and pay less tax.
It is also important to know that you can be required to repay any benefits
you received because you reported your marital status incorrectly.
Government benefits are based on your household income.
If you moved to a new home for work or to run a business at a new location,
or you moved to be a student in full-time attendance in a post-secondary
program, you may be eligible to claim moving expenses.
To qualify, you must have moved at least 40 kilometres closer to your new
work or school. Some of the moving expenses that you can claim are:
* Transportation and storage costs for household items, including boats and
* Travel expenses, including vehicle expenses, meals and accommodation to
move you and your household members and your belongings to your new home.
* Temporary living expenses up to a maximum of 15 days.
* Cost of cancelling the lease for your old home.
* Incidental costs related to your move, such as changing your address on
legal documents (but not with Canada Post), replacing driver’s licenses and
utility disconnections and hook-ups.
* Cost to maintain your old home when vacant, up to a maximum of $5,000.
* Cost of selling your old home or buying your new home (if you sold your
old home because of the move).
Some of the costs that cannot be claimed include repairs to make
your home saleable, travel expenses for house-hunting trips, expenses to
clean or repair a rented house, and mortgage default insurance.
Additional educational resources
Evelyn Jacks’ new book,
Essential Tax Facts, can help guide you through the rest of 2017’s tax season in addressing
tax issues like these – especially if you are a late filer. More
importantly, this is the first book on the market that reflects tax
provisions for your 2018 filings. Get your copy today to help you prepare
audit-proof returns and claim everything you’re entitled to, this year and
next. Knowledge Bureau’s
Introduction to Personal Tax Preparation certificate course is another great resource if you typically prepare your
own returns, or do so for family and friends.
© 2018 The Knowledge Bureau, Inc. All rights reserved. Reprinted with
Evelyn Jacks is the founder and President of Knowledge Bureau, which
brings continuing financial education in the multiple areas of
specialization to advisors and their clients. She is the author of 52
books on tax and wealth planning. This article
originally appeared in the
Knowledge Bureau Report. Follow Evelyn Jacks on Twitter
@EvelynJacks. Visit her blog at www.evelynjacks.com.
Evelyn Jacks’ latest book,
NEW ESSENTIAL TAX FACTS: How to Make the Right Tax Moves and Be
Audit-Proof, Too is available now.
Notes and Disclaimer
The foregoing is for general information purposes only and is the opinion
of the writer. No guarantee of investment performance is made or implied.
It is not intended to provide specific personalized advice including,
without limitation, investment, financial, legal, accounting or tax advice.