With an aging population and a strained social support system, many of us will be looked upon to provide some amount of financial support for an elderly person which, in some cases, may place a financial strain on the supporting individual. Not to be overlooked is the tax relief provided by both the federal and provincial governments.
Generally speaking, tax relief for costs incurred by the elderly is delivered in the form of federal and provincial tax credits which reduce the individual’s income tax liability. The federal tax credit is 15% of the relevant personal amounts which include items such as the basic personal amount, age amount, disability tax credit and medical expenses. A person with insufficient income to utilize the tax credits may transfer those credits to a supporting individual. In addition and depending on the circumstances, the supporting individual may receive a caregiver tax credit.
Caring for the elderly may also require the supporting person to be away from work. In such a case, financial support may be available by application through the Canadian Employment Insurance program.
Don’t let the financial strain of caring for the elderly become a huge burden by speaking with a pro about tax and program relief for the elderly and their supporters.