IN SICKNESS AND IN WEALTH: How Marriage Affects Your Taxes

how marriage affects your taxes

 

Being married, or having a common-law partner, impacts your tax situation in a number of ways. The good news is that many are beneficial to you and your spouse. Married and common-law couples may be eligible for a number of additional tax benefits that can help them save money on their next return. Join Liu & Associates as we highlight a few of the ways being married can help you out come tax time.

 

Spousal Tax Credit

If your partner has a lower income, you may be eligible for a non-refundable tax credit which can help to reduce the amount of income tax you’ll pay. To qualify, your partner must have a net income of less than $11,474.

Combine Charitable Donations

You get a non-refundable tax credit when you donate to registered charities. By having one spouse claim all of the donations for the year, you and your partner can get a larger tax credit. Note: there are some donations you cannot claim. Learn more about what donations are eligible to claim here.

Spousal RRSP Contributions

If one partner has a much larger amount of money in an RRSP, it means they will have to pay more tax when they decide to withdraw it. By divvying up RRSP contributions, you can help balance your incomes when you retire, which means that both you and your partner will get taxed at a lower rate.

Combine Medical Expenses

You are able to claim medical expenses for your spouse or common-law partner. When filing your taxes, consider having the person with the lower income claim all of the medical expenses for the couple. Why? The tax credit for medical expenses is based on a percentage of your income, which means you’ll probably get a bigger tax credit!

Common Medical Expenses

The Government of Canada has an excellent list of what medical expenses can be claimed, and whether or not you need any supporting documents in order to claim them. Check out the full list here.

Taxes Are Hard – Liu & Associates Can Help!

Our expert accountants will help you get the most out of your tax return. Give us a call to book an appointment today!

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