Adrian Mastracci, portfolio manager at KCM Wealth Management, says “It is more advantageous for one person to claim all the family’s charitable donations. That way the low rate credit on donations is only used once."

Vancouver, BC (April 11, 2007): Tax filing is well under way.

Adrian Mastracci, fee-only portfolio manager at Vancouver based KCM Wealth Management comments on five tax filing tips everyone should be aware of for 2006 tax returns.

1. Capital gains and losses

If you realized a capital gain in 2006, say from selling real estate, stocks, mutual funds or bonds, it is reported on Schedule 3. Capital losses must be applied against capital gains in 2006, carried back three years against previous capital gains, and/or carried forward indefinitely.

Capital gains and losses are also found on T3, T5, T5013 or T4PS slips. Losses carried forward from previous years are used on Line 253 to offset 2006 capital gains. Form T1A carries losses back.

2. New tax credits

Take advantage of the tax credits new for 2006. The employment tax credit is found on Line 363, the public transit credit is on Line 364 and the textbook tax credit on Line 323 comes from Schedule 11.

3. Charitable donations

It is more advantageous for one person to claim all the family’s charitable donations. That way the low rate credit on donations is only used once. Don’t forget donations that may have been carried forward in the last five years. Use form T1-DON along with Schedule 9.

4. Medical expenses

Medical expenses are more useful in the lower income spouse or partner. The actual expenses are reduced by the lesser of $1,884 or 3% of net income on Line 236. Form T1-MED is used. In some cases, you may be able to deduct medical expenses of dependent relatives, say a grandparent.

5. Tax return for a child

Filing a return for a child may be beneficial. Say the child had a part-time job. While no tax may be payable, it may give rise to an RRSP contribution room which is useful later. Another benefit may be the GST credit.

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NOTE: The information provided above is intended for general informational purposes only. It does not constitute advice for anyone's specific situation. Everyone should always first consult directly with their advisors to determine the appropriateness of any information contained above before taking any action. KCM Wealth Management Inc. assumes no responsibility for any loss or damage arising from the use of, or reliance upon the above information.