Tax Return Changes For 2020 In Canada

Tax rules change every year and 2020 tax year is no exception. We have consolidated all the tax changes by province for your easy consumption. Review the federal change and the province specific changes applicable to you. If you have any questions, you can Contact Us with subject ‘new tax changes’.

Federal Tax Changes

COVID-19 related payments

You may have received federal, provincial, or territorial government COVID-19 payments such as the Canada Emergency Response Benefit. If these amounts are taxable, you will have received a slip, such as a T4A or T4E. They will also be available under My Account on CRA site and can be downloaded automatically using Auto-Fill My Return feature for filing your tax return.

Enhanced Canada Pension Plan/Quebec Pension Plan – Line 22215

Maximum allowable claim for this line has been increased to $165.60.

Home Buyers’ Plan

If you are not considered a first-time home buyer for the purposes of the HBP, and you experience a breakdown in your marriage or common-law partnership, you may be able to participate in the HBP under certain conditions.

Employment Expenses for Working at Home Due to COVID-19 – Line 22900

If you worked from home in 2020 due to Covid-19, you may be able to claim work-space in the home expenses and supplies. You can choose simplified method to claim upto $400 without any receipt or you can choose detailed method with all the receipts to claim work-space in the home expenses and supplies. New form T777S has been included for claiming these expenses.

Social benefits repayment – Line 23500

If you received the Canada Recovery Benefit, you may have to repay all or part of it, if your net income after certain adjustments is more than $38,000. The repayment is calculated on the Worksheet for the return at line 23500, as part of the social benefits repayment calculation.

Basic personal amount – Line 30000

This has increased for most taxpayers to $13,229 whose income is less than $150,473. If your income is more than $214,368, you can claim basic personal amount of $12,298.

Spouse or common-law partner amount – Line 30300

This has increased for most taxpayers to $13,229 whose income is less than $150,473. If your income is more than $150,473, maximum for spouse amount will be limited to your basic personal amount.

Amount for an eligible dependant – Line 30400

This has increased for most taxpayers to $13,229 whose income is less than $150,473. If your income is more than $150,473, maximum amount for eligible dependant will be limited to your basic personal amount.

Digital news subscription tax credit – Line 31350

For the 2020 to 2024 tax years, you may be able to claim a non-refundable tax credit for expenses you paid in the year for a digital news subscription with a qualified Canadian journalism organization.

Tuition, education, and textbook amounts – Line 32300

The Canada training credit that the student claims for the year reduces the amount that they can use to calculate their tuition tax credit, transfer to a designated individual, or carry forward to a later year.

Donations and gifts – Line 34900

For 2020 and later tax years, you may be able to claim a non-refundable tax credit for donations made to registered journalism organizations.

Canada training credit – Line 45350

If you meet certain conditions, you will be able to claim a Canada Training Credit, a new refundable tax credit that is available for 2020 and later tax years.

Canadian journalism labour tax credit – Line 47555

For 2020 and later tax years, if you are a member of a partnership that is a Qualifying Journalism Organization, you can claim this new, refundable credit allocated to you by the partnership.

Mineral exploration tax credit for flow-through share investors

This investment tax credit is extended for an additional 5 years to March 31, 2024.

Alberta tax changes in 2020

Alberta investor tax credit

Alberta investor tax credit has been eliminated but unused carry forward amounts can still be claimed.

Alberta tuition and education tax credits

Alberta tuition and education tax credits have been discontinued. Students can continue to claim any unused amounts carried forward from previous years.

British Columbia tax changes in 2020

Change in provincial non-refundable tax credit

Provincial non-refundable tax credits have been increased resulting in more tax savings for you. Here is the summary of changes:

  • Basic personal amount increased to 10,949 ;
  • Maximum age amount increased to 4,910  ;
  • Maximum spouse amount is now 9,376 ;
  • Maximum amount for an eligible dependent is now 9,376 ;
  • Maximum BC caregiver amount for dependent increased to 4,792 ;
  • Maximum disability amount increased to 8,212 ;
  • Maximum adoption amount for eligible child increased to 16,563 ;

 

New tax bracket

A seventh personal income tax rate of 20.5% has been added for taxable income over $220,000. 

Charitable gifts over $200

Charitable gifts over $200 will be calculated using the new 20.5% tax rate when your taxable income is over $220,000. 

British Columbia tuition and education amounts

Beginning in 2020, the British Columbia tuition and education amounts will be reduced by any Canada training credit claimed for the year. 

Tax credits extended

The training tax credits have been extended until December 31, 2022. The farmers’ food donation tax credit has been extended until December 31, 2023.

Manitoba tax changes in 2020

Change in provincial non-refundable tax credit

  • Basic personal amount increased to 9,838 ;

 

Manitoba seniors economic recovery credit

This new one-time refundable tax credit has been introduced for eligible seniors to claim $200.

Manitoba tuition and education amounts

Beginning in 2020, the Manitoba tuition and education amounts will be reduced by any Canada training credit claimed for the year.

Mineral exploration tax credit

This investment tax credit has been extended until the end of 2023.

New Brunswick tax changes in 2020

New Brunswick tuition and education amounts

Beginning in 2020, the New Brunswick tuition and education amounts will be reduced by any Canada training credit claimed for the year.

Change in provincial non-refundable tax credit

Provincial non-refundable tax credits have been increased resulting in more tax savings for you. Here is the summary of changes:

  • Basic personal amount increased to 10,459 ;
  • Maximum age amount increased to 5,107;
  • Maximum spouse amount and amount for an eligible dependent increased to 8,882  ;
  • Maximum caregiver amount for dependent increased to 4,940 ;
  • Maximum amount for infirm dependent increased to 4,940 ;
  • Maximum disability amount increased to 8,468  ;

Newfoundland and Labrador tax changes in 2020

Temporary Newfoundland and Labrador deficit reduction levy

This has been discontinued as of December 31, 2019.

Newfoundland and Labrador tuition and education amounts

Beginning in 2020, the Newfoundland and Labrador tuition and education amounts will be reduced by any Canada training credit claimed for the year.

Change in provincial non-refundable tax credit

Provincial non-refundable tax credits have been increased resulting in more tax savings and bigger tax refund you. Here is the summary of changes:

  • Basic personal amount increased to $9,498 ;
  • Maximum age amount increased to $6,063 ;
  • Maximum spouse amount and amount for an eligible dependent increased to $7,761 ;
  • Maximum caregiver amount for dependent and amount for infirm dependent increased to $3,016 ;
  • Maximum disability amount increased to $6,409 ;
  • Maximum adoption amount for eligible child increased to $12,818 ;

 

Nova Scotia tax changes in 2020

Nova Scotia tuition and education amounts

Beginning in 2020, the Nova Scotia tuition and education amounts will be reduced by any Canada training credit claimed for the year.

Ontario tax changes in 2020

Change in dividend tax credit rate

The rate used to calculate the dividend tax credit has decreased to 2.9863% for other than eligible dividends.

Change in provincial non-refundable tax credit

Provincial non-refundable tax credits have been increased resulting in more tax savings for you. Here is the summary of changes:

  • Basic personal amount increased to $10,783 ;
  • Maximum age amount increased to $5,265 ;
  • Maximum spouse amount and amount for an eligible dependent increased to $9,156 ;
  • Maximum caregiver amount for dependent and amount for infirm dependent is $5,082 ;
  • Maximum disability amount increased to $8,712 ;
  • Maximum adoption amount for eligible child increased to $13,156 ;

Prince Edward Island tax changes in 2020

Prince Edward Island tuition and education amounts

Beginning in 2020, the Prince Edward Island tuition and education amounts will be reduced by any Canada training credit claimed for the year.

Change in provincial non-refundable tax credit

Provincial non-refundable tax credits have been increased resulting in more tax savings for you. Here is the summary of changes:

  • Basic personal amount increased to $10,000 ;
  • Maximum spouse amount and amount for an eligible dependent increased to $8,493 ;

Quebec tax changes in 2020

Deduction for expenses related to working remotely due to COVID-19 – Line 207

If you worked from home in 2020 due to Covid-19, you may be able to claim work-space in the home expenses and supplies. You can choose simplified method to claim upto $400 without any receipt or you can choose detailed method with all the receipts to claim work-space in the home expenses and supplies. New form TP-59.S has been included for claiming these expenses.

Incentive Program to Retain Essential Workers (IPREW) – Line 151

If you received benefits under the Incentive Program to Retain Essential Workers, review the instructions for Line 151 to report it.

Farm worker bonus – Line 154 Point 2

If you received a farm worker bonus under the IPREW, it will be reported on Line 154.

Canada Emergency Response Benefit, Canada Emergency Student Benefit, and Canada recovery benefits – Line 111 / 154

If you received the Canada Emergency Response Benefit, the Canada Emergency Student Benefit, the Canada Recovery Benefit, the Canada Recovery Sickness Benefit or the Canada Recovery Caregiving Benefit, it will be reported on line 154. However, if you received Employment Insurance benefits under the Canada Emergency Response Benefit, it will be reported on line 111.

Tax credit for childcare expenses – Line 455

Effective January 1, 2020, what it means to be attending a qualified educational institution has changed for purposes of the tax credit for childcare expenses. Effective January 1, 2020, you can take courses offered by a qualified educational institution at a distance without any virtual presence at a fixed time or interaction with the professor or the class being required. However, presence (either physical or virtual) will remain mandatory for courses offered by a secondary school.

Dividend tax credit – line 128 and 415

Effective January 1, 2020, to be entitled to the full tax credit for dividends received or deemed received in a given year, you must have been resident in Québec on December 31 of that year (or on the day you ceased being resident in Canada). The rate of the dividend tax credit applicable to the actual amount of ordinary dividends went from 6.3825% to 5.4855%. The rate of the tax credit applicable to the actual amount of eligible dividends went from 16.2564% to 16.1460%.

Virtual currency transactions (Cryptocurrency) – Line 24, 139 and 164

To report your income related to these transactions, you must determine whether it is considered as capital gain(loss) or business income (loss).

Tax credit for caregivers – Line 462 Point 2

The tax credit for caregivers now has two components. The first is for caregivers providing care to a person 18 or over who has a severe and prolonged impairment in mental or physical functions and needs assistance in carrying out a basic activity of daily living. The second is for caregivers providing care to and living with a person 70 or over.

Tax credit for interest on a loan granted by a seller-lender and guaranteed by La Financière agricole du Québec – Line 462 Point 30

The tax credit for interest on a loan granted by a seller-lender and guaranteed by La Financière agricole du Québec has been extended for five years. You may therefore be eligible for the credit if you received a loan under a contract signed after December 2, 2014, but before January 1, 2025.

Tax credit for volunteer respite services and tax credit for respite of caregivers – Line 462 Point 21

Because of the changes to the tax credit for caregivers, the tax credit for volunteer respite services and the tax credit for respite of caregivers were cancelled as of January 1, 2021. However, you can still claim them for the 2020 taxation year. In addition, beginning in 2020, you may be able to receive an additional amount (which is not subject to a reduction based on your family income) for expenses paid to receive specialized respite services. However, you cannot claim the tax credit for volunteer respite services or the tax credit for respite of caregivers in respect of an eligible care receiver for whom you are you are claiming the tax credit for caregivers.

Tax credit for career extension – Line 391

Work Chart 391 has been replaced by form TP-752.PC-V, Tax Credit for Career Extension.

Disability supports deduction – Line 250

Expenses incurred after December 31, 2019, to obtain goods and services allowing you to take distance courses from a designated educational institution or a secondary school qualify for the disability supports deduction.

Tax credit for taxi drivers – line 462 point 3

The maximum tax credit for taxi drivers has been changed to $594.

Quebec prescription drug insurance plan

On July 1, 2020, the contribution rates for the Québec prescription drug insurance plan were increased. Consequently, the maximum premium has been raised from $636 to $648. The maximum premium for 2020 is therefore $642.

Change in provincial non-refundable tax credit

Provincial non-refundable tax credits have been increased resulting in more tax savings for you. Here is the summary of changes:

  • Deduction for workers on line 201 increased to $1,190 ;
  • Basic personal amount on line 350 increased to $15,532 ;
  • The amount for a person living alone increased to $1,780 on schedule B ;
  • Age amount increased to $3,267 on schedule B ;

Saskatchewan tax changes in 2020

New non-refundable tax credits available to eligible volunteers

Three new non-refundable tax credits are available to eligible volunteers beginning January 1st, 2020: the volunteer firefighters’ amount, search and rescue volunteers’ amount, and volunteer emergency medical first responders’ amount.