Federal Budget 2010 – Tax Effects

  • Basic personal amount, tax brackets , tax credits
    • No changes
  • Medical expense tax credit (METC)
    • Expenses purely for cosmetic purposes are not eligible for tax credits
  • Shared custody and Child benefits
    • The Budget will allow two eligible individuals who share custody of a child to each receive 50% of
      • Canada child tax benefit
      • Universal child Care Benefit
      • GST/HST credit
    • The policy will apply if the child lives more or less equally with two individuals  who live separately
  • Single Parents and Universal child care Benefit (UCCB)
    • The budget proposes to allow a single parent the option of including the UCCB income in the income of the dependent for whom an eligible dependent credit is clamied. If the single parent can’t claim it, the UCCB can be claimed in the income of one of the children for whom the UCCB is received.
  • RRSP Rollover to an RDSP
    • Budget proposes to allow a rollover of a deceased individual’s RRSP proceeds to the RDSP of financian dependent infirm child or grandchild. Effective deaths occurring or after March 4, 2010
  • Scholarship exemption and Education Tax credit
    • Budget proposes
      • Post-doctorial fellowships will be taxable
  • Stock option tax deferral election repealed
    • Budget proposes to repeal the tax deferral election and to ensure that withholding tax is remitted by the employer based on the value of the employment benefit related to the acquisition of securities under stock option. (effective March 4, 2010)
  • Accelerated CCA for Clean Energy Generation
    • CCA of 50% Per year on a declining balance basis
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Federal Budget 2010

Changes to the 2010 Federal Budget and their tax effects.