Tax rules, thresholds and administrative procedures can change. Confirm current official requirements and obtain advice for material transactions or unusual facts.
Update benefit information promptly
Apply for or update Canada Child Benefit information and ensure both spouses file returns each year. Benefit calculations generally use adjusted family net income, so marital status and income information must be accurate.
Parental leave can produce a tax shortfall
EI maternity or parental benefits and employer top-ups may not have enough tax withheld when combined with employment income earned earlier in the year. Estimate total annual income and set aside funds or request additional withholding.
RRSP deductions and benefits
An RRSP deduction may reduce net income and can affect income-tested benefits. That does not make a contribution automatically best; compare current cash needs, contribution room and future withdrawal tax.
Medical expenses
Keep receipts for eligible fertility, pregnancy, birth, prescription and infant-related medical costs. Reimbursements must be considered. The family can choose a qualifying 12-month period ending in the tax year and should compare which spouse claims the expenses.
Childcare starts later but records begin now
When childcare begins, keep provider receipts with identifying information and confirm who is normally required to claim the deduction. Payments to relatives, camps or home providers have specific conditions.
Household plan
Create a leave-year budget showing reduced income, benefits, employer top-up, tax reserve and childcare start date. Update direct deposit and address information and avoid sending birth certificates or SIN information through insecure channels.
This article provides general Canadian tax information and is not a substitute for tax, legal, financial or investment advice based on complete circumstances.