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6 Ways The New Federal Budget Can Affect Your 2017 Tax Return

04/07/2017 11:18 EDT | Updated 04/07/2017 11:20 EDT

In March, the Liberal government announced the federal budget for 2017-2018, which included several important changes that impact taxpayers in Canada. Although there were relatively few tax measures mentioned on March 22, it's important to know what these changes are and what the implications will be for you and your family in the coming years.

black couple taxes

(Photo: Dean Mitchell via Getty Images)

Below are some of the main tax changes you should be aware of:

Farewell, public transit amount

Much to the disappointment of many Canadians who rely on public transportation and used to claim those expenses in their tax returns, the government announced the elimination of the public transit amount. According to the Liberals, they found that the credit hasn't been effective enough in encouraging the use of public transit and reducing greenhouse gas emissions. The good news, however, is that the public transit amount won't be eliminated until July 1, 2017, so it will make one last appearance when you file your 2017 tax return -- hooray!

HST/GST for ride-sharing services equals leaner wallets

In an attempt to level the playing field between taxis and ride-sharing services, the government will be introducing HST/GST charges to Uber and Lyft rides. What that means is the average consumer is now going to see an HST or GST charge on their receipts after using a ride-sharing service, just like they would on a regular taxi ride -- ultimately making their ride more expensive than it was before. The change will take effect on July 1, 2017, so there's still a bit of time to get mentally prepared for that.

Time to claim that fertility treatment

Many Canadians who have used assisted reproductive technologies over the past 10 years may now be eligible for a tax break thanks to a change announced during the federal budget. Previously, Canadians had to be diagnosed as medically infertile to be able to claim the cost of reproductive technologies as part of their medical expenses in their tax filing.


Now, you don't have to be medically diagnosed as infertile, which opens the tax credit to people like single women who want to have a child or same-sex couples who want to start a family. Did you know that this tax change will also be retroactive? This means anyone who has incurred expenses over the past 10 years for reproductive technologies such as in vitro fertilization can re-file their taxes for that year and claim the expense.

Employment Insurance enhancements

The government announced a number of positive changes to Canada's Employment Insurance (EI) program:

  • Individuals will now be able to take up to 15 weeks off work to support a family member who is recovering from a critical illness or injury

  • Parents of critically ill children (who are already entitled to 35 weeks of benefits) will be able to share these benefits with more family members

  • Unemployed workers will now be allowed to return to school to get training without losing their EI benefits

  • Changes will also be made to parental benefits to allow parents to receive them over an extended period of 18 months at a reduced rate

  • Women will be allowed to claim maternity benefits for up to 12 weeks before their due date instead of the current 8 weeks

First-time donor's super credit no more

The federal budget confirmed that the first-time donor's super credit will expire at the end of 2017. The super credit was introduced in the 2013 federal budget and provides an additional 25 per cent tax credit for the first $1,000 donated to a registered charity by a donor who has not claimed a charitable donation tax credit since 2007. This measure was always intended to be temporary, available only for gifts made after 2012 and prior to 2018. Donors who have not claimed a charitable donation tax credit since 2007 should consider making a donation before the end of 2017 to take advantage of the super credit before it expires.

Tax evasion be gone

During the budget meeting, the government reiterated that it is committed to cracking down on tax evasion and combating tax avoidance. According to the government, this will be accomplished by increasing verification activities, hiring additional auditors and specialists with a focus on the underground economy, developing structures to target high-risk international tax and abusive tax avoidance schemes and also improving the investigation of criminal tax evaders. For Canadians who are transparent about their taxes each year, this shouldn't affect them -- it just means everyone needs to pay their fair share moving forward.

Click here for more information on what was announced in the federal budget.

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