Childcare expense deduction and tax saving estimator

In Canada, childcare expenses are generally claimed by the lower income spouse and limited by per child caps and by two thirds of earned income. This estimator applies those three limits to the expenses you enter and estimates the tax saving at your marginal rate. Amounts are in CAD.

Calculator

Total childcare expenses paid in the year (CAD) Children under 7 at year end (not eligible for the disability amount) Children age 7 to 16 (not eligible for the disability amount)

Children eligible for the disability tax credit amount Earned income of the lower income spouse (CAD) Marginal tax rate of the person claiming (percent)

Caps used: $8,000 per child under 7, $5,000 per child age 7 to 16, and $11,000 per child eligible for the disability amount. These are the long standing federal caps. Confirm current amounts before filing.

Total per child cap-

Two thirds of earned income limit-

Estimated deductible amount (lowest of expenses, cap, and income limit)-

Estimated tax saving at your marginal rate-

Expenses after estimated tax saving-

Worked example

Expenses $12,000, one child under 7, no other children, earned income $30,000, marginal rate 20 percent. Per child cap: $8,000. Income limit: two thirds of $30,000 equals $20,000. Deductible amount: the lowest of $12,000, $8,000, and $20,000, which is $8,000. Estimated tax saving: $8,000 times 20 percent equals $1,600. Expenses after the saving: $12,000 minus $1,600 equals $10,400. The calculator above is prefilled with these numbers.

How it works

The deductible amount is the lowest of three figures: the expenses you actually paid, the total per child cap for your children, and two thirds of the earned income of the lower income spouse. The estimated tax saving is the deductible amount times the marginal rate you enter. Special rules can change who claims and what counts as earned income, for example during school, parental leave, or illness, so treat this as a planning estimate only.

Estimates only. This is not tax or financial advice. Childcare expense rules, caps, and rates change and depend on your full tax situation. Confirm current rules with the Canada Revenue Agency and a qualified tax professional before filing or spending.

Want the after subsidy fee first? Stack CWELCC and provincial help province by province.

Frequently asked questions

Who usually claims childcare expenses in Canada?

Generally the lower income spouse or common law partner claims them, with specific exceptions. This estimator follows that general rule and asks for that person's earned income.

Does a subsidy reduce what I can claim?

Amounts reimbursed or subsidized for the same care generally cannot also be claimed as expenses. Enter only the expenses you paid and were not reimbursed for, and confirm the treatment of your provincial help with a tax professional.

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