As we round out the end of 2020, here are some important tax numbers to keep in mind for planning purposes.

If you’re working:

• Maximum RRSP contribution: The maximum contribution for 2021 is $27,830; for 2020, it’s $27,230.
• TFSA limit: In 2021, the annual limit is $6,000, for a total of $75,500 for someone who has never contributed and has been eligible for the TFSA since its introduction in 2009. The annual limit for 2020 is also $6,000, for a total of $69,500 in room available in 2020 for someone who has been eligible since 2009.
• Maximum pensionable earnings: For 2021, the maximum pensionable earnings amount is $61,600 ($58,700 in 2020), and the basic exemption amount remains $3,500 for 2020 and 2021.
• Maximum EI insurable earnings: The maximum annual insurance earnings (federal) for 2021 is $56,300, up from $54,200 in 2020.
• Lifetime capital gains exemption: The lifetime capital gains exemption is $892,218 in 2021, up from $883,384 in 2020.
• Low-interest loans: The current family loan rate is 1%.
• Home buyers’ amount: Did you buy a home? You may be able to claim up to $5,000 of the purchase cost, and get a non-refundable tax credit of up to $750.
• Medical expenses threshold: For the 2021 tax year, the maximum is 3% of net income or $2,421, whichever is less. For 2020, the max is 3% or $2,397.
• Basic personal amount: The basic personal amount for 2021 is $13,808 for taxpayers with net income of $151,978 or less. At income levels above $151,978, the basic personal amount is gradually clawed back until it reaches $12,421 for net income of $216,511. The basic personal amount for 2020 ranges from $12,298 to $13,229.

If you’re over 65:

• Age amount: You can claim this amount if they were 65 years of age or older on December 31 of the taxation year. The maximum amount they can claim in 2021 is $7,713, up from $7,637 in 2020.
• OAS recovery threshold: If your net world income exceeds $79,845 in 2021 or $79,054 in 2020, he or she may have to repay part of or the entire OAS pension.

If you have children, dependants

• Canada caregiver credit: If you have a dependant under the age of 18 who’s physically or mentally impaired, you may be able to claim up to an additional $2,295 for 2021 and $2,273 for 2020 in calculating certain non-refundable tax credits. For infirm dependants 18 or older, the amount for 2021 is $7,348 and the 2020 amount is $7,276.
• Disability amount: The amount for 2021 is $8,662 (non-refundable credit; $8,576 in 2020), with a supplement up to $5,053 for those under 18 (the amount is reduced if child care expenses are claimed; $5,003 in 2020).
• Child disability benefit: The child disability benefit is a tax-free benefit of up to $2,915 (2021) for families who care for a child under age 18 with a severe and prolonged impairment in physical or mental functions. For 2020, the amount is $2,886.
• Canada child benefit: In 2021, the maximum CCB benefit is $6,833 per child under age six and up to $5,765 per child aged six through 17. In 2020, those amounts are $6,765 per child under age six and up to $5,708 per child aged six through 17. Eligible recipients received $300 more per child earlier this year as part of the government’s financial support during the Covid-19 pandemic.

Eddy Mejlholm, CFP, CIM, FCSI – Portfolio Manager & Wealth Advisor
RBC Wealth Management | RBC Dominion Securities
9296 Main Street, Chilliwack, BC V2P 4M5
Telephone: 604-701-0901 Fax: 604-870-7171 Cell: 604-316-0714
http://www.eddymejlholm.com/