Essential tax numbers: updated for 2020

This article was updated on Nov. 27, 2019, to include 2020 numbers. 

You have a lot to remember as an advisor, so we’ve assembled this reference list of tax numbers. We’ll update it as things change.

Working clients

• Maximum RRSP contribution: The maximum contribution for 2019 is $26,500; for 2020, $27,230.
• TFSA limit: In 2020, the annual limit is $6,000, for a total of $69,500 for someone who has never contributed and has been eligible for the TFSA since its introduction in 2009. The annual limit for 2019 is $6,000, for a total of $63,500 in room available in 2019 for someone who has been eligible since 2009.
• Maximum pensionable earnings: For 2020, the maximum pensionable earnings is $58,700 ($57,400 in 2019), and the basic exemption amount remains $3,500 for 2019 and 2020.
• Maximum EI insurable earnings: The maximum annual insurance earnings (federal) for 2020 is $54,200; for 2019, $53,100.
• Lifetime capital gains exemption: The lifetime capital gains exemption is $883,384 in 2020 and $866,912 in 2019.
• Low-interest loans: The current family loan rate is 2%.
• Home buyers’ amount: Did your client buy a home? He or she may be able to claim up to $5,000 of the purchase cost, and get a non-refundable tax credit of up to $750.
• Medical expenses threshold: For the 2020 tax year, the maximum is 3% of net income or $2,397, whichever is less. For 2019, the max is 3% or $2,352, whichever is less.
• Donation tax credits: After March 20, 2013, the first-time donor super credit is 25% for up to $1,000 in donations, for one tax year between 2013 and 2017. This program has now expired.
• Basic personal amount: For 2020, it’s $12,298, line 300. For 2019, it’s $12,069. (Note that the newly re-elected federal Liberal government promised to raise the basic personal amount over four years to reach $15,000, phasing out the benefits of the increase at incomes over $147,667.)

Older clients

• Age amount: Clients can claim this amount if they were 65 years of age or older on December 31 of the taxation year. The maximum amount they can claim in 2020 is $7,637; in 2019, it’s $7,494.
• Pension income amount: Clients may be able to claim up to $2,000 if they reported eligible pension, superannuation or annuity payments.
• OAS recovery threshold: If your client’s net world income exceeds $79,054 for 2020 and $77,580 for 2019, he or she may have to repay part of or the entire OAS pension.

Clients with children, dependants

• Canada caregiver credit: If you have a dependant who’s physically or mentally impaired, you may be able to claim up to an additional $2,182 in calculating certain non-refundable tax credits.
• Disability amount: The amount for 2020 is $8,576 (non-refundable credit; $8,416 in 2019), with a supplement up to $5,003 for those under 18 (the amount is reduced if child care expenses are claimed; $4,909 in 2019).
• Child disability benefit: The child disability benefit is a tax-free benefit of up to $2,886 (2020) for families who care for a child under age 18 with a severe and prolonged impairment in physical or mental functions. For 2019, the amount is $2,832.
• Canada child benefit: This non-taxable benefit was effective July 1, 2016, and replaced the universal child care benefit. In 2020, the maximum CCB benefit is $6,765 per child under age six and up to $5,708 per child aged six through 17. In 2019, those amounts are $6,639 per child under age six and up to $5,602 per child aged six through 17. In May 2020, eligible recipients will receive $300 more per child, as part of the government’s financial support during the Covid-19 pandemic.
• Child care expense deduction limits: As of 2018, the maximum amounts that can be claimed are $8,000 for children under age seven, $5,000 for children aged seven through 16, and $11,000 for children who are eligible for the disability tax credit.

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.