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Last updated: August 09 2023
Back to School Supplies: Canada Child Benefit Increases Can Help
Evelyn Jacks
The cost of living adjustment for the Canada Child Benefit, along with other federal benefits and credits, increased by 6.3% in July, bringing a welcome raise to families with children who are navigating inflation-fuelled price increases, especially for back-to-school supplies. A mid-summer plan to improve the CCB for next year should however begin now. Here’s what you need to know:
The CCB that can be received is now up to a maximum annual total of $7,437 per child, for children under the age of 6 and for those between 6 and 17, it’s $6,275. There is also a supplement for disabled children. However, what’s important is that this benefit is based on family net income and the number of children in the family. By reducing the size of the family net income, with an RRSP deduction, for example, more of these important monthly CCB benefits can result.
How much can you receive? Before anything can be received, the family must file tax returns. Check out the maximum amounts and clawback zones for the CCB benefit year of July 2023 to June of 2024 below. The trick to the RRSP strategy is to reduce family net income, where possible to the amounts below the clawback income zones:
|
Benefit for Children Under 6 |
$7,437 ($619.75 per month) |
|
Benefit for Children Between 6 and 17 |
$6,275 ($522.92 per month) |
ClawBack Rates (2023)
|
|
Family Net Income |
||
|
Number of Children |
Under $34,863 |
$34,864 to $75,537 |
Over $75,537 |
|
1 |
0% |
7.0% |
$2,847 + 3.2% |
|
2 |
0% |
13.5% |
$5,491 + 5.7% |
|
3 |
0% |
19.0% |
$7,728 + 8.0% |
|
4+ |
0% |
23.0% |
$9,355 + 9.5% |
If the child is disabled, the Child Disability Benefit of $2,989 for 2022-23 ($3,173 for 2023-24) is paid and is reduced where family net income exceeds $71,060 ($75,537 for 2023-24). The reduction rate is 3.2% for families with one child and 5.7% for families with two or more eligible children.
Provincial Credits included with GST or CTB Credit Payments
|
Province |
Credit |
|
AB |
Alberta Family Employment Tax Credit (AFETC) |
|
BC |
Basic Family Bonus BC Earned Income Benefit BC Low Income Climate Action Tax Credit (BCLICATC) BC Early Childhood Tax Benefit (starting April 2015) |
|
MB |
None |
|
NB |
New Brunswick Child Tax Benefit (NBCTB) |
|
NL |
Newfoundland and Labrador Child Benefit Mother Baby Nutrition Supplement |
|
NT |
Northwest Territories Child Benefit (NWTCB) |
|
NS |
Nova Scotia Child Benefit (NSCB) Nova Scotia Affordable Living Tax Credit (NSALTC) |
|
NU |
Nunavut Child Benefit (NUCB) |
|
ON |
Ontario Child Benefit (OCB) Ontario Sales Tax Transition Benefit (OSTTB) Ontario Senior Homeowners’ Property Tax Grant (OSHPTG) Ontario Energy and Property Tax Credit Northern Ontario Energy Credit |
|
PE |
None |
|
SK |
Saskatchewan Low‑Income Tax Credit (SLITC) |
|
YT |
Yukon Child Benefit (YCB) |
Bottom Line: Two important strategies can help families as the fall activities ramp up. Do the math – before and after an RRSP deduction – to illustrate the maximum CCB potential benefit. Then make room for the actual contribution, after the back-to-school budget has been satiated. A great way to generate future tax refunds, and save for your retirement.
It’s a shame when Canadians fail to file a tax return and miss out on important tax free benefits like the Canada Child Benefit. That circumstance brings a second opportunity: catch up on prior filed returns and get those missed benefits now. This can help fund an RESP (Registered Education Savings Plan) for the future education of the children, too.
