10 ways to save money at tax time
(NC) – It might be the dead of winter, but you can still put a spring in your step as you prepare for tax filing time. Here are 10 ways to save money – and these tips may even get you that refund you've been hoping for:
1. Tax-free savings account (TFSA): Using a TFSA is a great way to save on tax. Generally, interest, dividends, and capital gains earned on investments in a TFSA are not taxed—not when they are held in the account or when they are withdrawn.
2. Registered retirement savings plan (RRSP): Pay less tax and save for your retirement at the same time. Any income that you earn in your RRSP is usually free from tax as long as the funds stay in the plan.
3. Charitable donations: Donations of cash, goods, land, or listed securities made to a registered charity or other qualified donee may be eligible for a tax credit. New this year, if you are a first-time donor, you may be eligible to claim the first-time donor's super credit which gives you an extra 25% credit when you claim your charitable donation tax credit.
4. Parents: All those mornings spent at the hockey rink and afternoons spent at the ballet studio can mean savings—with the children's fitness and arts tax credits. Child care is also deductible, so keep your receipts.
5. Family caregiver credit: If you have a dependant with a physical or mental impairment, you could be eligible for an additional amount of $2,040 when calculating certain non-refundable tax credits.
6. Students: Were you a student in 2013? You may be able to claim tuition, textbook, and education amounts, as well as moving expenses if applicable. And if you've recently graduated, you can claim the interest you paid on your student loan.
7. Public transit amount: If you are a regular public transit rider, you may be able to save by claiming your transit passes. You can get up to 15% of the amount claimed.
8. Seniors: If you receive income from a pension, you can split up to 50% of eligible pension income with your spouse or common-law partner to reduce the taxes that you pay. You may also be eligible to claim the age amount, medical expenses, and the disability tax credit.
9. Home buyers: You may be able to claim $5,000 for a 15% non-refundable tax credit if you bought your first home in 2013.
10. Hiring an apprentice: Did your business employ an apprentice? An employer who paid a salary to an employee registered in a prescribed trade in the first two years of his or her apprenticeship contract qualifies for a non-refundable tax credit.
Finally, make filing your taxes this spring even easier by doing it online. It's fast, easy, and secure and it may give you extra time to take care of that something on your to-do list that's a lot more fun than spring cleaning.
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