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Public Transit Tax Credit

Budget 2017 Proposes to Eliminate The Non-Refundable Public Transit Credit

Date: March 2017

The 2017 budget has moved to eliminate the non-refundable public transit credit for amounts paid for eligible transit passes (including available electronic payment cards) for the use of public transit services after June 2017.

  1. What is the public transit tax credit?
  2. Currently, a 15% non-refundable tax credit is available to any individual in respect of the cost of eligible transit passes which includes annual and monthly passes, as well as weekly passes and electronic fare cards used on an ongoing basis. An individual can claim the cost of eligible public transit passes for the utilization of the transportation services by the person’s spouse or common-law, partner or their child who is under the age of 19 at the end of the taxation year.

  3. How is the public transit tax credit changing?
  4. The elimination of the public transit tax credit for amounts paid for eligible transit passes that are for the use of public transit services will take place from June 2017.This is as stipulated in the 2017 budget. Therefore no payment will be made again with regards to using off public transit services from June 2017.

  5. Can I claim a tax credit for amounts that I paid for from January to June 2017?
  6. It is a big yes! You can still claim your tax credits that are the 15% non-tax credit, only if the payment was made between January ist to June 30 2017.

  7. If I have already paid for my annual transit pass for the period January to December 2017, will I be eligible to claim a tax credit for the full amount that I paid before July 1, 2017?
  8. No. Regardless of the possibility that you paid a sum before July 1, 2017, you can assert on your 2017 pay duty and advantage return, just the cost relating to the part that is for travel administrations for the period January 1 to June 30, 2017. For the situation that you paid for a great travel pass which is legitimate after June 30, 2017, for example, a yearly pass, you should allocate your cost to decide the sum paid that is for the period January 1 to June 30, 2017.

    For instance, Robert bought yearly travel go for himself for 2017 for $700 and his companion buys month to month passes each month that cost $80 every month. His partner buys her past seven days before the beginning of a month. They have chosen that Robert will assert the travel pass credit for the greater part of their qualified travel pass costs. Additionally, neither of their bosses repay them for the cost of their travel passes.

    Robert will figure his travel pass acknowledge for 2017 as takes after: January 1 to June 30 is six months, and Robert's yearly pass is legitimate for travel administrations for each of the 12 months of the year.

    A qualified segment of the sum paid for Robert's annual pass: $700 x 6/12 = $350

    A qualified part of the amount paid by his mate for her month to month passes: $80 every month x 6 months = $480

    Note: Robert cannot exclude the cost of the travel pass his life partner bought in June that is for travel benefits in July.

    Add up to qualified costs are as per the following: $350 + $480 = $830

    Robert will enter $830 on line 364 of Timetable 1 as its large travel pass sum. The estimation of Robert's extensive travel imposes credit will be $830 x 15% = $124.50 for 2017. Since people in general travel charge credit is a non-refundable credit, it is utilized to diminish and access the debt, yet any abundance is not discounted or refunded.

  9. Where can I get more information on the proposed changes to the transit tax credit?
  10. The CRA is ever committed to informing taxpayers of every bit of information. Therefore the CRA website is updated on a weekly basis with new policies and guidelines. Find time to check their websites for any information regarding transit tax credit.

    In other words, you can also contact the finance department about tax credits.