Written for Daily Hive by Christopher Liew, a CFA Charterholder, former financial advisor, and the creator of Wealth Awesome.
Are you getting the most from your government benefits? Even if you think what you’re getting is fair, there’s always a chance that you could receive more.
With the rising cost of living, every extra dollar helps. Your taxes help fund these government programs, so it’s in your best interest to ensure you get the maximum amount you’re eligible for.
Get ready to learn how to maximize your government benefits in Canada below.
Research benefit supplements
As you’re reading this, you may be already enrolled in common government benefits, such as:
- Old Age Security (OAS)
- Canada Pension Plan (CPP)
- Guaranteed Income Supplement (GIS)
- Canada Child Benefit (CCB)
- GST/HST credit
- Employment Insurance (EI)
These benefits are designed to provide additional aid to lower- and middle-income Canadian families, as well as retirees, the unemployed, and new parents.
However, some of these benefits have associated supplements that provide an additional payment to beneficiaries who meet specific criteria.
For example, the CCB features a child disability supplement that provides additional aid to help parents and guardians care for their child’s unique needs. The CPP also has a similar disability supplement to provide disabled retirees with further assistance.
If you’re receiving any of these federal benefits, I encourage you to research any additional supplements you may be eligible for. Often, these supplements won’t be automatically applied, especially if you weren’t eligible when you first began receiving the benefit.
This also applies to recent life changes.
For example, if you recently got married, had a child, started caring for an elderly or disabled family member, or suffered from a job loss, you may be eligible to begin receiving benefits immediately.
Look into provincial government benefits
Federal benefits are the most common. However, many provinces also offer their own additional benefits to qualifying residents. Some examples of this include:
You can learn more about these provincial benefits by visiting your province’s official website. Unlike federal benefits, which are often issued automatically, many provincial benefits must be applied for separately.
Apply for benefits on time
Many federal and provincial benefits in Canada have a cut-off date by which applicants must apply for or renew the benefit. If you miss the cut-off date, you may be denied the benefit until the following year.
While this isn’t the case with all benefits, it’s still in your best interest to apply for your eligible benefits on time to avoid confusion and take full advantage of the programs.
File your taxes on time
Your eligibility for some benefits depends on the income you claimed on your recent tax returns. Based on your income level and family situation, benefits like the Canada Child Benefit, Canada Worker’s Benefit, and GST/HST tax credit may be automatically applied.
However, if you fail to file your taxes on time, the government won’t have the most up-to-date information on your income. This, in turn, could result in your benefits being suspended or reduced.
If you file your taxes late, you may be required to re-apply for these benefits, which can be a hassle.
Reassess old tax returns with a professional
On the flip side, you may also receive retroactive benefits. If you believe you were previously eligible for a benefit payment but failed to apply for it or didn’t receive it, you may be able to claim benefits from a previous tax year.
In this case, working with a professional tax preparer or accountant can be helpful. These individuals are trained to take your personal situation into account, quickly read through lengthy tax returns, and identify benefits and programs you may be eligible for.
Take advantage of registered accounts
The government offers several registered account programs to help Canadians save for the future and pay less taxes.
One of the most notable registered account benefits is the Canada Education Savings Grant (CESG), applied to eligible Registered Education Savings Plan (RESP) account holders.
As long as you make regular annual contributions to the account, the government will offer an additional 20% (up to $500 per year) on your annual contribution amount.
Lower and middle-income families may be eligible for an additional $100 to $200.
Aside from this free benefit, other registered accounts, such as the Tax-Free Savings Account (TFSA), First Home Savings Account (FHSA), and Registered Retirement Savings Plan (RRSP), allow Canadians to take advantage of tax-sheltered growth, yearly tax deductions, and other benefits.
Stay up-to-date with the latest benefit programs
Finally, one of the best ways to maximize your government benefits in Canada is to stay updated with the ever-changing benefit structure. Federal and provincial governments periodically update existing benefits, which could increase your eligible amount. The government may also add new benefits and credits you can apply for.