Canadian Federal Budget 2011

Well, it looks like the budget that was proposed today won't go through, and instead we'll go to the polls.  The highlights most of the news stations carried did not have a lot of detail, but there were a few things of interest to our community, and one pretty big one.

• This 15-per-cent non-refundable credit on an amount of $2,000 will provide tax relief for caregivers of all types of infirm dependent relatives, including, for the first time, spouses, common-law partners and minor children.

This would amount to around $300 back on our income tax each year.  Not huge, but every little bit helps of course.  If that's per child, in our case it would be $600.

• Caregivers who incur medical and disability-related expenses for an aging parent, sibling or other financially dependent relative are generally able to claim these expenses under the 15-per-cent Medical Expense Tax Credit. However, a $10,000 limit applies on the amount that can be claimed for such a relative. As a result, some caregivers who incur extraordinary medical and disability-related expenses do not receive full tax recognition for these expenses.

We certainly haven't come anywhere near that $10,000 limit, but I can see there being a year or two where we might, especially when it comes to an accessible vehicle, and retrofitting the house with wheelchair lifts, the bathroom, etc.

However, to me, the biggest benefit of this budget would have been the following:

• Budget 2011 proposes to allow annual RDSP withdrawals of up to $10,000 in taxable plan savings, as well as a pro-rated amount of plan contributions, in respect of a beneficiary with a life expectancy of five years or less, without requiring the repayment of CDSGs and CDSBs paid into the plan in the preceding 10 years.

Under the current rules, there was basically no way for our boys, given their shortened life expectancies, to get real value out of RDSPs.  Should this change go into whatever budget we get, it suddenly becomes a viable option for a savings plan to help out with their future expenses. 

I don't want to suggest that anyone vote based on this alone, there are lots of other consideration.  However, if we indeed our headed to the polls in the coming months, I plan to approach every candidate in my riding, and explain that these relatively small changes to the current rules can make a huge impact on families in situations like ours.