A Review of Major 2008/2007 Federal and Provincial Changes Still Applicable for 2009

Land Transfer Tax Refund Program
The province’s December 2007 minibudget expanded the provisions of Ontario’s existing land transfer tax refund available to first-time purchasers of newly constructed homes to encompass first time homebuyers of resale homes as well. Effective December 14, 2007, first time purchasers of both types of homes are eligible for a provincial refund on up to $2,000 of the land transfer tax paid for their new home. Follow this link for additional information http://www.rev.gov.on.ca/en/refund/newhome/

Pension Income Splitting
Federally - The first $2,000 of pension income is eligible for the pension credit and taxpayers are now allowed to split pension income with their spouse or partner.

Provincially - The Ontario government announced that it would also allow taxpayers to split up to 50 percent of their eligible pension income with their spouses or common-law partners.

New Child Tax Credit
Effective January 1st, 2007 a new non-refundable child tax credit of $2,000 for each child under the age of eighteen will be given to parents. Unused amounts can be transferred between spouses or common-law partners.

RESP Lifetime Contribution Limit
The lifetime contribution limit to registered education savings plans was increased to $50,000. The maximum annual contribution eligible for the Canada Education Savings Grant (CESG) was increased to $500 (20% of a $2,500 contribution). The annual contribution limit of $4,000 was eliminated.

Public Transit Tax Credits
The tax credit for public transit passes is a non-refundable tax credit for the cost of buying a monthly (or longer duration) pass for commuting on buses, streetcars, subways, commuter trains and local ferries. For 2007 the credit has been extended to include electronic payment cards if used on at least 32 one-way trips in a 31 day period, and weekly passes, provided passes are purchased for at least four consecutive weeks.