How the new federal taxes changes impact your family

Maya Wariyar

Agenda

oGo over 4 major tax changes that will impact families

oDiscuss two examples

oWhat can you do with the tax savings

oTrivia plus prizes

Cost of raising a child

MATERNITY LEAVE- PAY TAXES

LOST WAGES

MANDATORY EXPENSES

ONGOING EXPENSES

Where does the money go?Taxes

Ultilites/Bills

Rent/Mortgage

Food

Fun expenses: Travel , Eating out

“Our Government is focused on helping hard-working Canadian families make ends meet, by making important priorities like child care and after-school sports more affordable. Under this plan, every family with children will have more money in their pockets, to spend on their priorities as a family.”– Prime Minister Stephen Harper

Trivia QuestionHow many roses and of which colour is the traditional romantic gift?

A. 9, White

B. 2, Yellow

C. 7, Pink

D. 12, Red

Family Tax Cut NEW Effective Tax year 2014

Universal Child Care Benefit

ENHANCED

Replacement of the Child Tax Credit

Effective Tax year 2015

Child Care Expenses Deduction

INCREASED Effective 2015 Tax year

Children’s Fitness Tax Credit

INCREASED Effective Tax year 2014

Is it better to get a tax credit or a tax deduction?

Enhanced Universal Child Care Benefit

Eligibility

Enhanced Universal Child Care BenefitIncrease the monthly benefit by $60

0

100

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500

600

Jan

Feb

Mar

Ap

r

May Jun

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Au

g

Sep

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No

v

Dec

Am

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nt

Month

Children under that Age of 6

Children between ages six and seventeen

0

100

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JAN FEB MAR APR MAY JUNE JULY AUG SEP OCT NOV DEC

Am

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You do not need to apply to receive increased amounts

What can you do with this monthly income?Child’s education

Daily living expenses

Child extracurricular expenses

Trivia QuestionWhat falling object is said to have inspired Isaac Newton's theories about gravity?

A. Orange

B. Plum

C. Pineapple

D. Apple

Child Care Expenses Deduction

Age PreviousDeduction

NewProposal

Age less than 7 $7,000 $8,000

Age 7 to 16 $4,000 $5,000

Disability Tax Credit

$10,000 $11,000

What does the 'e' of e-mail stand for?

Trivia QuestionWhat does the 'e' of e-mail stand for?

A. Efficient

B. Easy

C. Empty

D. Electronic

FAMILY TAX CUT

Transfer up to $50,000

Example Two earner coupleTwo Children

PAT EARNS $60,000

Marginal tax rate: 22%

CHRIS EARNS $12,000

Marginal Tax Rate: 15%

Non refundable Tax Credit up to $2000

Who benefitsOnly families with children under 18 with two parents in different tax brackets would benefit.

Children's Fitness Tax Credit

Children's Fitness Tax Credit

0 200 400 600 800 1000 1200

Prior to Tax year 2014

Tax year 2014 and later

Increase in Children’s Fitness Tax Credit

Trivia QuestionWhat is the only continent without a desert?

A. Africa

B. South America

C. Australia

D. Europe

Example-Two earner coupleKelly earns $95,000 and Dale earns $25,000

Two children ages 7 and 3

The younger child attends full-time daycare and the older one attends summer camp and after-school care.

Benefits of Tax changesFamily Tax Cut : $2000 tax relief

Universal Child Care Benefit payments of $220 monthly (1,440 increase in benefits)

$2000 increase in deduction for Child Care expenses

Example-One Earner CoupleIsabelle and Marc are a one-earner couple earning $60,000.

They have two children aged 2 and 4.

Example One-Earner Couple

Isabelle and Marc are a one-earner couple earning $60,000

They have two children aged 2 and 4.

Benefits of Tax ChangesThe Universal Child Care Benefit enhancement: $$320

Family Tax Cut: Transfer the $30, 000 Income

Trivia QuestionWhat kind of electricity can be produced by combing your hair?

Less taxes to pay

Means more money to secure your future!

Use the money wisely!Understand your regular expenses

Understand the Gap

Make it happen

Use your tax reductions to secure your family’s future

Pay off your debts

Increase Savings

The power of compound interest

10,000 Initial MoneyAnnual Compounded Interest 2.5%

End of Year 1 $250

End of Year 2 $256

End of Year 3 $262

Total Interest $768

This presentation is for information purposes only; anyone wishing to act on the information presented should consult their advisor