VANCOUVER, March 15, 2017 – Canadians are always looking for ways to save their hard earned money. Sometimes, the most obvious place is in your income tax return. For the 2016 tax year, the Chartered Professional Accountants of British Columbia (CPABC) have put together some tips on how you can save your employment income in your tax return:
1. Deduct your employment expenses.
If you incurred employment expenses for commission employees, travel expenses, motor vehicle expenses, professional or union dues, office rent, assistant’s salary, and consumable supplies, you might be able to claim a deduction in respect of these expenses on your tax return. To verify your eligibility to claim employment expenses, your employer must certify the conditions of your employment on Form T2200. The Canada Revenue Agency does not require you to file the form with your tax return; however you must retain it in case they wish to see it.
2. Calculate your Canada employment tax credit.
The Canada Employment Credit was introduced to help employees with work expenses like uniforms, home computers, or other materials needed for their jobs. If you reported employment income in 2016, you can claim the lesser of $1,161 and your total employment income for the year. The tax credit for 2016 is 15 per cent, or the lowest personal tax rate for the year, providing a maximum tax savings of $174. Remember to take advantage of this and all other tax credits available to you.
3. Get a credit for taking transit to work.
If you take public transit to and from work, you might be eligible to claim a special tax credit for transit passes purchased in 2016 on your income tax return. Claims may be made on transit passes that provide unlimited use of public transit for at least 20 days in any 28-day period. A claim is also available for short-term passes provided that each pass provides at least 5 consecutive days of unlimited public transit use or at least 20 days in any 28-day period. Eligible cost-per-trip electronic payment cards may also qualify in 2016 provided they are used for at least 32 one-way trips during an uninterrupted period of no more than 31 days. Save those old transit passes. They could be worth 15 cents per dollar when you file your tax return.
Looking for more tips? Check out CPABC’s RRSP and Tax Tips at www.rrspandtaxtips.com.
NOTE TO JOURNALISTS: Local CPAs are available for interview. Infographic is available for reprint.
Please credit Chartered Professional Accountants of British Columbia (CPABC) for use of the content and include the following disclaimer: Tax rules relating to these RRSP tips are complex. This is not intended as tax advice and you should not make tax decisions based solely on the information presented in these tips. You should seek the advice of a chartered professional accountant before implementing a tax plan or taking a tax filing position.
About CPA British Columbia
The Chartered Professional Accountants of British Columbia (CPABC) is the training, governing, and regulatory body for almost 35,000 CPA members and 5,500 CPA students and candidates. CPABC carries out its primary mission to protect the public by enforcing the highest professional and ethical standards and contributing to the advancement of public policy. CPAs are recognized internationally for bringing superior financial expertise, strategic thinking, business insight, and leadership to organizations.
– 30 –
For more information or to arrange an interview, contact:
Vivian Tse, Public Affairs Specialist