Here are some highlights from the Q&A, tackling topics such as capital gains, medical expenses and pension splitting.MattZ90/iStockPhoto / Getty Images
On April 1, Globe reporters Erica Alini, Salmaan Farooqui and Rudy Mezzetta answered reader questions about filing for the 2024 tax season.
They answered queries about the changing capital gains tax, medical expenses and pension splitting.
Here are some highlights from the Q&A. Questions and responses have been edited for length and clarity.
Medical expenses
Can you continue to claim dependents after they turn 19 if they are in school?
Rudy Mezzetta: You can’t claim a child who has reached the age of 18 as an eligible dependent unless they are dependent on you due to mental or physical infirmity.
Further information on claiming an amount for an eligible dependent can be found at this link on CRA website.
Can you claim the full amount of the cost of a knee replacement done at a private clinic and clinic in Canada?
Erica Alini: Generally speaking, you can claim eligible expenses for which you haven’t been and won’t be reimbursed. Here’s a CRA searchable database of eligible expenses.
You’ll see that while the list says cosmetic surgery isn’t eligible but doesn’t mention medically necessary procedures performed at a private clinic. What you describe may be an eligible expense, but it’s best to check with an accountant.
Are there any tax credits for being the daily caregiver of a spouse who has an illness?
Alini: The federal caregiver credit is available to Canadians who provide care for a spouse or common-law partner, or a dependent, with a physical or mental impairment. There may also be provincial tax credits to look into, depending on where you live.
What benefits should I be aware of as a female, single retiree?
Salmaan Farooqui: One notable benefit is around medical and disability costs.
You can claim medical expenses if your total expenses exceed either 3 per cent of your net income or $2,759. The types of expenses that qualify as a medical expense are vast: They include premiums paid for private health insurance, costs incurred by items not fully covered by personal insurance, such as glasses or prescription drugs, and even incremental costs for gluten-free products for people with celiac disease.
It’s also worth noting that you can “double dip” on medical and disability credits, meaning you can claim both tax credits for a single expense. This is generally not possible with other credits. Expenses such as home remodelling for accessibility reasons can be deducted against both tax credits.
Capital gains and homebuyers
What is the bare trust filing status for 2024 for assets with parents on bank accounts, and children on property, for example? Also, do I have to submit the UHT forms for a cottage held as a bare trust by family members?
Alini: The CRA is not requiring bare trusts to file for 2024. For the Underused Housing Tax, Ottawa has largely scrapped filing requirements for Canadian owners but only from the 2023 tax year onward. Further details on the UHT can be found here.
When will the CRA begin processing tax returns that report capital gains? Is there a firm date?
Mezzetta: The CRA issued guidance on March 11 suggesting that Canadians who are reporting capital gains in 2024 wait to file their returns while the CRA updates its systems and finishes the process of certifying tax prep software platforms. The CRA has indicated that it expected to have most software platforms certified by the end of March.
However, the CRA has yet to issue new guidance regarding whether it has finished updating its systems. You may want to speak with your tax advisor regarding whether you can go ahead and file for 2024 or whether it would be prudent to wait. As you may be aware, the CRA has given taxpayers reporting 2024 capital gains until June 2 to file a T1 without interest or late-filing penalty.
Have the capital gains taxes reverted back to only applying to 50 per cent of gains?
Alini: Yes, the CRA is no longer administering the proposed change that would have raised the inclusion rate to two-thirds of gains. Fifty per cent is the current inclusion rate.
Since the capital gains changes have been dropped, do I still need to break down my capital gains into the two periods (Jan 1. to June 24 and June 25 to Dec. 31)?
Mezzetta: The 2024 Schedule 3 (for the reporting of capital gains and losses) breaks down capital gains into two periods corresponding to the dates in question. The CRA has left the form this way, despite the fact that the proposed capital gains changes are not going forward, to align the Schedule 3 with tax slips that had already been prepared under the proposed rules, among other reasons.
Your 2024 T-slips will include instructions of where to input reported capital gains on the Schedule 3. Tax software should input those figures automatically into the correct sections on the schedule. As you know, now that the government has said it will not proceed with the proposed hike in the capital gains inclusion rate, all 2024 gains will be subject to a 50-per-cent inclusion rate even if they’re broken out into two periods.
I don’t receive my T3s until May, which may or may not include capital gains, but personal income taxes are due at the end of this month. What do I do?
Mezzetta: As you alluded to, the CRA has given trusts, including mutual funds and ETFs structured as trusts, until May 1, 2025 (usual deadline is March 31) to issue T3 slips. In turn, individuals who are reporting a capital disposition for 2024 on their T1 tax return have until June 2, 2025 to file without interest or late-filing penalty. (The official filing deadline remains April 30, 2025.)
While the CRA has provided some guidance on the tax filing relief this season, we are still waiting for the CRA to provide additional updates. You might continue to check in with the CRA website for further information.
A taxpayer who hasn’t received their T3 slips yet and who is not sure whether they are eligible for the filing relief might consider contacting their investment firm or financial advisor for guidance in terms when they should expect to receive the slips. My understanding is that investment firms are working hard to get T3 slips to investors in a timely fashion.
Is there anything I need to know about filing my taxes if I’m considering buying a home this year?
Farooqui: This is more relevant to next year’s taxes, but be sure to take advantage of the First Home Savings Account if you’re first time buyer. Your contributions are tax deductible, meaning you can get more money back on your tax return.
The deadline to contribute to the account for your 2024 taxes was December 31st 2024, but it’s worth contributing in 2025 for next year’s return. The maximum contribution room grows by $8,000 per year and the money must be used towards an applicable home purchase.
Different jurisdictions
What is my tax liability for selling assets in a different country? How do I get credit for taxes paid abroad?
Mezzetta: A Canadian resident must report their worldwide income on their T1 return annually. However, Canada has tax treaties with other countries that typically prevent the taxpayer from being double taxed. For example, foreign tax credits may be available for tax paid outside Canada.
Here’s CRA information on claiming foreign tax credits.
What if I worked in two different provinces during the tax year? Would I get full credits from each province or are they prorated for the entire year?
Farooqui: There can be some intricacies to this, but generally speaking your provincial tax is based on your place of residence on December 31st of the given tax year.
So if you worked in Alberta for a few months but lived in British Columbia on December 31st, you’ll file B.C. taxes.
There’s no proration for provincial taxes – you only file taxes for one province at a time.
Carbon rebate and tax brackets
What’s going on with the carbon tax rebate this year? Are Canadians still getting it?
Alini: There is one last carbon rebate instalment going out to everyone who would normally be eligible for it this spring. CRA has said they’ll begin paying out rebates on April 22 for taxpayers who’ve sent in their return by April 2. If you file later than April 2, you’ll still get the rebate, if you’re eligible for it, but likely a little later.
I retired at 55, but my wife and I are not yet 65. Am I allowed to do pension income splitting?
Mezzetta: Annuity-type payments from a registered pension plan can be split at any age while RRIF or LIF withdrawals can be split with a spouse at age 65 and over. Here is further CRA guidance on income splitting.
Federal tax brackets rose in 2025, how does that affect my tax filings?
Farooqui: Federal tax brackets tend to grow each year based on inflation. For an individual whose income did not change from the previous year, it could mean you’ll be charged slightly less in taxes. That’s because a smaller amount of your income will apply in higher tax brackets.
However your total tax bill will depend on many other factors such as the tax credit you’re eligible for.
Deductions and late payments
Do tax filing softwares automatically process all personal deductions and potential savings or must you look up forms and deductions on your own?
Alini: With certain types of tax software you do have to look up forms and deductions on your own. That said, the software asks you questions about your situation to understand what forms it needs to fill out and gauge what tax breaks you might qualify for. Just keep in mind it’s always possible the software will miss certain deductions and credits you’d qualify for, especially if your circumstances are unusual.
I subscribe to The Globe and Mail online. Can I claim this on my 2024 income tax return as a deduction?
Farooqui: You can claim a Globe and Mail subscription (or subscriptions for other qualifying news outlets) for the digital news subscription tax credit. The maximum amount you can claim per year is $500. You can find more information here.
How long can you wait to pay what you owe if you owe money on your tax return?
Mezzetta: The deadline for filing a T1 return and paying tax is April 30, 2025. Self-employed individuals have until June 16 this year to file but must pay tax by April 30 if they have a tax liability. However, the CRA has given taxpayers who are reporting a 2024 capital gain until June 2 this year to file and pay any tax owing without interest or penalties.