My kids are growing up. Are they still dependants?
Taking care of yourself and your kids is a tall order! Days are busy with work, drop-offs & pick-ups, getting groceries, banking, that whole showering thing… there’s barely time for Netflix! We get that adulting is hard, and if you’re taking care of yourself plus a few others in your family, the Canada Revenue Agency (CRA) recognizes that it can be a big job. When tax time rolls around, they try to make that job just a bit easier by allowing you to claim those you care for as dependants.
Who is a dependant?
A dependant is someone in your life who relies on you for support. For income tax purposes, a dependant will usually be a relative either by blood, marriage, common-law partnership or adoption. Depending on your situation, a dependant might be your spouse or common-law partner, child, grandchild, parent, grandparent, brother, sister, uncle, aunt, niece or nephew. Most of the time, your relative also has to be a resident in Canada to qualify as a dependant.
How does claiming a dependant work?
Claiming a dependant on your tax return will give you access to a tax credit, and reduce what you owe to the CRA. It’s important to understand how these credits work before you claim them. Some are based on age or relationship, or on the person’s health. Some credits also adjust for your dependants’ income level.
My children are over 18. Can I still claim them as dependants?
Lots of parents continue to financially support their children after they turn 18. Here is a quick rundown on whether or not they can still be claimed:
They’re 17 going on 18: As long as your child was 17 years old at some point during the tax year, they’re considered dependants and can be claimed for the entire year. You don’t need to pro-rate the amount based on specific birthdays. But once they turn 18, unless they are disabled or need your help because they are unwell, they’re no longer considered a dependant for tax purposes, even if you continue to support them.
They’re unwell or disabled: If your child is unwell (“infirm” is another term the CRA will use), and older than 18, you’ll need a letter from a doctor describing the condition before claiming them.
They’re younger than 18 but earned income: If you’re a single parent and claiming the amount for an eligible dependant, you need to deduct your child’s income from the amount you can claim.
They’re getting a post-secondary education: If they’re 18 or older, they’re not eligible to be claimed as dependants. But, they can transfer you up to $5,000 in tuition and education credits, if they didn’t use all of them on their own tax return. To make this happen, they have to sign the back of their T2202A to officially complete the transfer.
They have medical expenses: If your child is over 18, you can continue claiming their medical expenses if you pay for them yourself. The amount you can claim is limited by 3% of your child’s net income.
So, if you have someone or a few people in your life that rely on you for support, make sure you’re in the know about their status as a dependant. Even if they’re growing up or out the door, you could still save some money on your tax bill.