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Are you missing out on free money for your kids?

If you have kids, Registered Education Savings Plans (RESPs) and the alphabet soup of related programs—CESG, A-CESG, CLB, BCTESG, QESI—can seem overwhelming and out of reach. Especially if you don’t have any money to contribute anyway.

But, you might be missing out! You may qualify for free money simply by opening an RESP for your kids.

Free money

If your family income is less than $45,916, you can get up to $2,000 per child.1 The federal government will deposit $500 the year you apply for this grant (the Canada Learning Bond) and $100 each subsequent year. They’ll even throw in an extra $25 the first year to help offset costs. The younger your child is when you apply for this grant, the more they will benefit.

If you live in BC (regardless of your income), you can get $1,200 per child.2 You must apply for this grant (the BC Training and Education Savings Grant) when they are between six and nine but special extensions apply to kids born before 2010. For those born in 2007 and 2008, the application deadline is August 15th, 2018.

To receive this money you just need to open an RESP, designate your child as a beneficiary, and apply for the relevant grant. You don’t need to make any contributions to the RESP and receiving these grants will not impact your entitlement to other benefits.

Top-ups

If you have even a small amount of money to save, you qualify for a 20% to 40% top-up.3 In other words, if you invest $100, the government will deposit an additional $20 to $40 in your account. You qualify for the 20% top-up (the Canada Education Savings Grant) regardless of your family income. You qualify for the 30% or 40% top-up (the Additional Canada Education Savings Grant) based on your family income.

If you live in Québec, you qualify for another, very similar, provincial top-up program called the Québec education savings initiative.4

What’s the catch?

Nothing, really. But here are some things to keep in mind:

  • You need to open your RESP at an institution that supports all the relevant grants. Outside of Québec, we highly recommend Wealthsimple—it’s free, online, has no account minimums, and applying for the grants is as easy as checking a box when you sign up.5
  • The primary caregiver (the person who receives the Canada Child Benefit) must apply for the grants.
  • The primary caregiver (and their partner, if applicable) must file a tax return every year so the CRA can calculate your net family income.
  • Most institutions can set you up with simple investments so you don’t need to know anything about investing.
  • It’s not just limited to university, your child can also use their RESP for college and most vocational training programs. The plan can stay open for 36 years, so they have lots of time to take advantage of the money.
  • If your child ultimately doesn’t use it you can: transfer it to a sibling, transfer it to your RRSP on a tax-free basis, or withdraw it yourself and pay tax on any growth (any unused grants will revert to the government).

That’s it! Now go open that RESP!

This post contains an affiliate link to Wealthsimple, though we’re just recommending them because we love them.

1Canada Learning Bond

2BC Training and Education Savings Grant

3Child Education Savings Grant and the Additional Child Education Savings Grant

4Québec education savings incentive

5At the time of writing, Wealthsimple does not yet support the Québec education savings incentive.

Cryptocurrency and your tax return

Bitcoin is a hot topic, especially now that tax season is here. We’ve been getting a ton of questions about cryptocurrency and your tax return, like:

  1. Do I need to report my cryptocurrency gains? (hint: yes, if you’ve sold or traded it)
  2. How do I report my income/gain/loss?
  3. What about mining?
  4. What if I accept cryptocurrency as payment?
  5. Do I need to file form T1135?
  6. What if I don’t report my cryptocurrency income?

We’ve written an in-depth help post that covers these common questions (and more). Even if you didn’t sell or trade any cryptocurrency last year, we recommend checking it out to avoid any surprises down the line.

Hodl on.

Get started on your 2017 tax return

It's almost tax season—hooray! This year, Auto-fill my return opens on February 12th and NETFILE follows on February 26th.

If that's just too long to wait (because you love working on your tax return), we've updated our Canadian tax return checklist to help you gather your tax information. On top of that, SimpleTax 2017 is up and running so you can start today.

Our 2017 checklist includes all of the slips, receipts, and documents you might need and highlights which of those are available through Auto-fill. We recommend signing up for CRA My Account so you can benefit from Auto-fill; it's awesome.

This year there were many federal, provincial, and territorial tax changes. While the list is long, none of these changes impact how you use SimpleTax. If there's something you need to know (e.g., that you can only claim public transit receipts for half the year) we point it out in the app.

Here's a list of most of the changes1, sorted by province or territory, if you're curious.

  • Caregiver amounts
    • Federal: The new Canada caregiver amount replaces and consolidates three former related credits.2 Despite the fancy new moniker, the only major change is that you can no longer claim a federal tax credit for non-infirm senior parents who live with you.
    • Alberta: No change (report those non-infirm senior parents who live with you because you still qualify for a provincial credit).
    • British Columbia: No change (report those non-infirm senior parents who live with you because you still qualify for a provincial credit).
    • Manitoba: No change (report those non-infirm senior parents who live with you because you still qualify for a provincial credit).
    • New Brunswick: No change (report those non-infirm senior parents who live with you because you still qualify for a provincial credit).
    • Newfoundland: No change (report those non-infirm senior parents who live with you because you still qualify for a provincial credit).
    • Northwest Territories: No change (report those non-infirm senior parents who live with you because you still qualify for a provincial credit).
    • Nova Scotia: No change (report those non-infirm senior parents who live with you because you still qualify for a provincial credit).
    • Nunavut: No change (report those non-infirm senior parents who live with you because you still qualify for a provincial credit).
    • Ontario: The new Ontario caregiver amount replaces two former caregiver credits and is similar to the Canada caregiver amount (in that non-infirm senior parents no longer qualify).
    • Prince Edward Island: No change (report those non-infirm senior parents who live with you because you still qualify for a provincial credit).
    • Québec: Rate changes only.
    • Saskatchewan: No change (report those non-infirm senior parents who live with you because you still qualify for a provincial credit).
    • Yukon: caregiver credits have followed the federal changes.
  • Fitness & arts amounts
    • Federal: The children's fitness and arts amounts were eliminated.
    • British Columbia: Children's fitness & arts expenses are still eligible for a BC tax credit.
    • Manitoba: Children's and young adult fitness & arts expenses are still eligible for a Manitoba tax credit.
    • Québec: Children's fitness & arts expenses are still eligible for a Québec tax credit.
    • Yukon: Children's fitness & arts expenses are still eligible for a Yukon tax credit.
    • Ontario: The Ontario children's activity credit was eliminated.
  • Tuition amounts
    • Federal: You can still claim your tuition paid as a tax credit but the education and textbook amounts were eliminated.
    • Manitoba: You can still claim both the provincial tuition and education amounts.
    • Manitoba: The maximum graduate tuition fee income tax rebate (a refundable credit) was reduced to $500 (from $2,500) per year.
    • Manitoba: The advance tuition fee income tax rebate was eliminated as of May 1, 2017.
    • New Brunswick: Both the tuition and education amounts were completely eliminated.
    • Ontario: Both the tuition and education amounts were completely eliminated for studies after September 5, 2017.
    • Saskatchewan: Both the tuition and education amounts were completely eliminated for studies on or after July 1, 2017.
  • Public transit amount
    • Federal: The public transit amount was eliminated for trips taken on or after July 1.
    • Ontario: Seniors are eligible for the new Ontario seniors public transit credit for trips taken starting July 1.
  • Labour-sponsored funds credit
    • Federal: The credit for federally registered funds was eliminated.
  • Alberta:
    • Introduced a new Alberta investor credit.
  • British Columbia:
    • Introduced a volunteer firefighter and search & rescue volunteer credit.
    • Eliminated the back-to-school amount.
  • Manitoba:
    • Eliminated the odour-control credit & the nutrient management credit for expenditures after April 11, 2017.
  • Ontario:
    • Eliminated the healthy homes renovation credit.
  • Québec:
    • Introduced new credits for: upgrading residential waste water treatment systems, and restoring a secondary residence that was impacted by the floods.
    • Eliminated the health contribution.
  • Saskatchewan:
    • Eliminated the one-time trade entry tools tax credit.

1 This list only includes credits and deductions that have been introduced or eliminated, it doesn't include any changes to tax rates or tax brackets.

2 The "caregiver amount", the "amount for infirm dependants", and the "family caregiver amount".