FAQ ON THE NEW CHILD CARE BENEFIT (« CCB »)
Thème: Family Law juin 28, 2016 by LMR Website Team
The new CCB will be implemented on July 1, 2016. We thought you might want to get some answers to your questions as to if and how it may impact on you and your family.
What is the Canada Child Benefit (“CCB”)?
The Canada Child Benefit (“CCB”) is the new benefit under the Income Tax Act (“ITA”) for those who are resident Canadians with children under the age of 18.
Who qualifies as a resident Canadian?
The shortest answer: You are a resident Canadian when CRA considers you a resident in Canada for tax purposes. Long answer? Start here: http://www.cra-arc.gc.ca/tx/nnrsdnts/cmmn/rsdncy-eng.html
What does the CCB replace?
Lots of things, specifically the alphabet soup known as: UCCB, CCTB and the NCBS.
Does the Disability Tax Credit still exist?
Yes it does. The Disability Tax Credit (DTC) provides an amount of up to $2,730 per eligible child continues to exist.
When does the CCB come into effect?
July 1st, 2016.
When is the first CCB payment to be made?
July 20th, 2016, and on the 20th of each month thereafter.
When are the last UCCB and CCTB payments to be made?
June 20th, 2016.
If I am already receiving UCCB and/or CCTB, do I have to do anything to get the CCB?
Yes – you have to file your 2015 income tax return. If you are receiving UCCB and CCTB and do not file your 2015 income tax return you will not automatically receive the CCB.
Do I have to file my 2015 income tax return to receive CCB even if I have no income to report?
Yes. Even if your income is zero.
How will my CCB entitlement be calculated?
CRA will use the recipient’s adjusted net family income from his/her 2015 income tax return. Your adjusted net family income from 2015 will determine your CCB entitlement for the period from July 2016 to June 2017 (inclusive). Your CCB entitlement from July 2017 to June 2018 will be based on your 2016 adjusted net family income.
What does the term “adjusted net family income” mean?
Net family income minus any UCCB and registered disability savings plan (RDSP) income received plus any UCCB and RDSP amounts repaid.
What is “net family income”?
Net family income is your net income (line 236) from your income tax return added to the net income for your spouse or common-law partner, if applicable. It does not include a child’s income.
If I am not presently in receipt of UCCB or CCTB, do I have to apply for CCB?
Yes, using one of the following:
- Automated Benefits Applications for newborns;
- The online service: “Apply for Child Benefits” on CRA’s My Account;
- Form RC66, Canada Child Benefits Application
What if I need to make adjustments to my CCTB, NCBS, and UCCB payments for prior years, can I still do so?
Yes you can, for months prior to July 2016.
How far back can I go to apply for CCB, UCCB, or CCTB?
10 years back, for any applications made after June 2016.
Is the CCB taxed?
No it is tax-free. The CCB will not reduce benefits paid under the Goods and Services Tax/Harmonized Sales Tax ((GST/HST) credit. The CCB will also not be included in income for the purposes of federal income-tested programs delivered outside of the income tax system, such as the Guaranteed Income Supplement, the Canada education savings grant, the Canada learning bond, the Canada disability savings bond and the Canada disability savings grant.
My domestic status has changed. Will this impact my receipt of the CCB?
Yes. You should update CRA as to your domestic status. And note that CRA would like you to tell them quickly, ideally within the month after the change in your status. See here: http://www.cra-arc.gc.ca/bnfts/mrtl/menu-eng.html
What happens if I share custody? Can I still receive the CCB?
CRA’s existing rules for shared custody as presently applied for CCTB purposes will apply to the CCB.
What are the CRA’s existing rules for shared custody?
CRA considers you to share custody if:
- The child lives with you and another individual in separate residences on more or less an equal basis. Generally this means that the child lives with each parent at least 40% of the time;
- The child may regularly alternate between residences in the following cycles:
- Four days with one person and three days with other;
- One week with one person and the next week with the other; or
- Any other regular alternating cycle.
- Both individuals must be primarily responsible for the child’s care and upbringing when the child lives with them;
If CRA accepts that I am in a shared custody situation, how will my CCB be impacted?
You will receive 50% of the benefit that you would have received if the child lived with you all of the time.
I am an “access” only parent. Will I qualify for the CCB?
If you do not meet the shared custody test, you will not qualify for the CCB.
I am separated, in a shared custody situation, and have multiple dependent children with my ex. Does it make a difference to the CCB which child(ren) my ex and I designate as dependents?
No. After a conversation with an agent at CRA’s Benefits Phone Line (1-800-387-1193,) the advice received was that the fact that a child is listed as an eligible dependent (or not) on line 305 does not change entitlement to the CCB. However, CRA may still review whether or not a child qualifies as an eligible dependent.
Who “wins” in a determination between what benefits my separation agreement says I am to receive and what the CRA says I get?
CRA.
How much will I receive under the CCB?
Visit the CCB calculator at: www.cra-arc.gc.ca/bnfts/clcltr/cfbc-eng.html
I can’t be bothered to use the calculator unless I think I may actually get some money. What can I possibly get?
$6,400 per year ($533 per month) for each child under the age of 6
$5,400 per year ($450 per month) for each child aged 6 to 17
I don’t like calculators, but rather would like to understand what math the calculator is doing?
Well you asked. According to the Finance Minister, here is how the CCB amount is determined:
The maximum benefit is to those whose adjusted net family income is under $30,000.00, with a maximum benefit of $6,400 per child under the age of 6 and $5,400 per child aged 6 through 17. On the portion of adjusted family net income between $30,000 and $65,000, the benefit will be phased out at a rate of 7 per cent for a one-child family, 13.5 per cent for a two-child family, 19 per cent for a three-child family and 23 per cent for larger families. Where adjusted family net income exceeds $65,000, remaining benefits will be phased out at rates of 3.2 per cent for a one-child family, 5.7 per cent for a two-child family, 8 per cent for a three-child family and 9.5 per cent for larger families, on the portion of income above $65,000.
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