For much of the year, and depending on their age, your children are in daycare, school or before/after school programs – so you know they are well cared for while you pursue your vocation. But during the summer months, when schools are closed and daycare centres may curtail their hours of operation, you have to find another way of keeping your kids safe and occupied during the day. That’s why summer day camps are such a popular choice for parents everywhere in Canada. And here’s a money-saving fact that makes day camps even more attractive: day camp fees, like other child care expenses, may be deducted from a parent’s income taxes. Here’s how it works.

Day camp expenses can be deducted from income tax by the lower earning spouse of an eligible child.

The amount of child care expenses that can be claimed in a tax year is based on the child’s age and whether the child has any disabilities.

The deductible amount also has an overall limit of two-thirds of the earned income of the lower earning parent.

The annual child care expense limit per child is:

Child under age 7 – $7,000

Child age seven to 16 – $4,000

Child eligible for the disability tax credit – $10,000

Deductions for payments to a boarding school or overnight camp have weekly limits. For each week the child attends the school or camp the weekly limit is:

Child under age 7 – $175 per week

Child age 7 to 16 – $100

Child eligible for the disability tax credit – $250

You can claim these deductions using tax form T778. You are not required to submit receipts with the form but you should retain them in case they are ever requested.

Child care expenses are tax deductible both federally and provincially, except for Québec. In Québec, child care expenses can be claimed as a refundable tax credit with the credit rate varying depending on net family income.

Get all the (tax) credit you deserve for sending your kids to day camp-and make sure you get maximum tax-reduction benefits from your other tax credits and deductions. Talk to your professional advisor about the complete roster of tax-saving strategies that can work for you.

This column, written and published by Investors Group Financial Services Inc. (in Québec – a Financial Services Firm), and Investors Group Securities Inc. (in Québec, a firm in Financial Planning) presents general information only and is not a solicitation to buy or sell any investments. Contact your own advisor for specific advice about your circumstances. For more information on this topic please contact your Investors Group Consultant.

Contact David Brown at (250) 315-0241 or at [email protected] to book your appointment.