The Enhanced Children’s Fitness Tax Credit

On October 9, 2014, the federal government announced that the maximum amount of expenses that can be claimed under the Children’s Fitness Tax Credit (CFTC) will be increased from $500 to $1,000, and proposes to make it a refundable tax credit in 2015 and subsequent tax years.

The new maximum limit can be claimed by parents when they file their 2014 tax return as a non-refundable credit.

Example for year 2014:

Sandra and Paul have a young son who is enrolled in the fall karate program for $500 and the winter hockey program for $700. The total eligible fitness expense for 2014 is $1,200. Prior to the increase of the maximum fitness tax credit, the tax liability is reduced by $75(15% of the maximum credit of $500). With the new maximum tax credit the tax liability would be reduced by $150 (15% of $1,000 maximum credit).

Parents of disabled children who were eligible for an additional $500 credit (total $1,000) in prior years will still be eligible for the additional $500 credit for a maximum total credit of $1,500 in 2014 and subsequent years.