September is right around the corner, and it’s an excellent time to start thinking about your 2024 tax return. Although taxes aren’t due until April of next year, it helps to keep track of your expenses and benefits throughout the year. 2025 will be here sooner than you think, and the sooner you start documenting your benefits and deductible expenses, the more prepared you’ll be to file.
This year, there are some major changes to long-standing Canada Revenue Agency (CRA) benefits. Some have been increased in value, others have new filing systems in place, and still others are completely new for the year. In this article, I will explore three CRA tax breaks you should claim on your 2024 taxes.
Canada Carbon Rebate
The Canada Carbon Rebate is a longstanding rebate available to Canadians from certain provinces. It gives you a certain amount of cash to offset the money you paid in carbon taxes. The amount varies from province to province. For example, a single Albertan with no children gets $225 per quarter, while a single Newfoundlander with no children gets $149 per quarter. These are flat rates: they don’t vary depending on how much you drive or fly, as you might think they do.
The Canada Carbon Benefit is higher for rural Canadians. Traditionally, people got 10% more than normal if they lived in a rural area. This year, the “rural supplement” increased to 20%. Also, you no longer need to have lived in a rural area this year to get the supplement; long-term residence as far back as 2016 can earn you the supplement. The increase in the supplement makes 2024 a very good year to claim the CCB.
Canada Child Benefit
Next up, we have the Canada Child Benefit. This is a cash benefit you can get if you have a child and your income is below a certain threshold. The amounts range from $7,787 per year for a small child and $6,570 per year for a child between the ages of six and 17.
Dividend Tax Credit
Next up, we have the dividend tax credit. This is a credit you claim on dividends.
Imagine that you held $100,000 worth of Fortis (TSX:FTS) — a major Canadian utility stock — in a taxable account. Let’s also imagine that you had a 50% marginal tax rate and lived in Ontario. Your $100,000 Fortis position would produce $3,990 worth of taxable dividends in a year, as the table below shows.
| COMPANY | RECENT PRICE | NUMBER OF SHARES | DIVIDEND | TOTAL PAYOUT | FREQUENCY |
| Fortis | $59.01 | 1,695 | $0.59 per quarter ($2.36 per year) | $999.75 per quarter ($3,999 per year) | Quarterly |
How much tax would you save by claiming the dividend tax credit on Fortis stock?
Well, Fortis pays eligible dividends, which means they are “grossed up” by 38% when calculating the credit. $5,519 is the amount for tax purposes. We’re assuming you have a 50% marginal tax rate, so you “pay” a pre-credit tax of $2,759. Then you subtract the 15% federal credit ($414) and the 10% provincial credit ($275.90) to arrive at your actual taxes payable: $2,069 — $690 in savings!
As you can see, the dividend tax credit saves you a lot of money. So, be sure to claim it when you file next year. It can make a big difference.
