2022 Personal Tax Update

Useful links and notes

• https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/whats-new.html
• https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/deductions-credits-expenses.html 
• www.benefitswayfinder.org helps to find grants, subsidies and benefits for individual taxpayers
• Underused housing tax – applies to residential real estate owned by any non-resident non Canadians and considered vacant or underused with some exemptions. Form UHT-2900 needs to be filed. (https://www.canada.ca/en/services/taxes/excise-taxes-duties-and-levies/underused-housing-tax.html) 

2022 

• Disability tax credit updates to definitions related to mental functions and life sustaining therapy (which includes Type 1 diabetes)
• Canada Dental Benefit applications are now available. Call 1-800-715-8836 to complete your application
  • Max is $650 if family income is less than $70,000 and you have full custody but you can apply if you meet the criteria for additional payment
  • Amounts above are adjusted down if making family income up to $89,999 or if there is shared custody of the child
  • Effective for expenses from October 1, 2022 onwards
• Medical expenses definition now includes surrogacy amongst others
• Ontario Staycation Refundable Credit (Ontario credit) – 20% on $1,000 per individual or $2,000 per family (https://www.ontario.ca/page/ontario-staycation-tax-credit)
• Senior Care at Home Refundable Credit (Ontario credit) – 25%
  • Max is $650 if family income is less than $70,000 and you have full custody but you can apply if you meet the criteria for additional payment
  • Reduced by 5% on income of $35,000 or more
  • At $65,000 income, there is no credit
• Lower-income ($35,000 per family or $20,000 for individuals) renters can now apply using the link below before March 31, 2023 for a one-time $500 top-up to the Canada Housing Benefit. (https://apps.cra-arc.gc.ca/ebci/uisp/hbw/en)
• Home buyer’s tax credit – first time buyers get $1,500
• Home accessibility tax credit – annual expense limit of $20,000 with refundable credit of $3,000 for seniors or those that qualify for disability tax credit
• Luxury tax in effect for purchases of new vehicles or aircraft over $100,000 and new boats over $250,000
• Purchase incentives for zero emission vehicles of up to $5,000 extended to March 2025 with broader eligibility requirements
• Certain capital assets may be allowed immediate expensing subject to certain restrictions

2023

• Capital cost ceiling for CCA for most passenger vehicles will now be $36,000 from $34,000. For zero-emission vehicles, it is now $61,000 from $59,000
• Leasing cost limit increases to $950/month from 900/month for leases entered into after January 1, 2023
• Anti flipping rule is in effect and will cover any houses owned under a year (not necessarily occupied – see underused housing tax above). This will deny any principal residence exemptions and the gain will be 100% taxable as business income (not capital gains)
• Tax free first home savings account (FHSA) in effect with tax-deductible contributions up to $8,000 per year up to a max of $40,000
• Multi generational home renovation tax credit – 15% credit ($7,500) on up to $50,000 in expenditures for eligible persons on qualifying renovations
• TFSA contribution limit increased to $6,500 annually for 2023. Total cumulative limit in 2023 if no contributions were ever made is $88,000