A married couple separated in 2021.
In 2022 the mother paid 50% of the daycare expenses and the father paid the other half of the daycare expenses.
My understanding is that the mother can only claim the amount she paid for childcare expenses.
Additionally, it’s my understanding that summer camps and after-school programs (when they allow the parent to work) are eligible for childcare expenses. As per the below links:
https://www.ontario.ca/page/ontario-child-care-tax-credit
Can anyone comment?
I would agree that each parent can only claim their share of the expenses as outlined in the Income Tax Folio S1-F3-C1, Child Care Expense Deduction for shared custody situations.
Yes. This is correct.
@kozakworld thank you for your helpful reply.
I noticed your use of the word “shared” custody arrangement.
Does the custody arrangement whether joint custody vs shared custody matter from a tax perspective? I have not confirmed the custody arrangement with the tax payer yet.
I see there is a difference between the two custody arrangements (see below).
A joint custody agreement is one in which both parents continue to have custody of the child and make decisions about the child together. In this arrangement, both parents make the important or difficult decisions for the child together, such as decisions include schooling, medical and religious upbringing.
For Joint Legal Custody, one parent may play a more active role in the day-to-day responsibilities, while the other has regular visitation rights. This is typically called having “primary care” of the child.
Shared Custody is very similar to Joint Custody in that both parents make custodial decisions together. The difference is that in Shared Custody arrangement, parents share physical custody of the child in addition to joint decision making. This solution requires parents to be able to cooperate and communicate with one another.
Shared Custody is huge pain the butt! I have a client who insists every year that him and his ex rotate which child they can “claim”. I keep trying to tell him that’s not how the rules work. CRA will split the benefits 50/50% but he insists that’s his “agreement”. He pays child support and deductible spousal support and his income is too high for the CCB.
As for childcare expenses, yes I agree with the above comments in a shared custody arrangement but only to the extent that the child lived with them. For example if one parent paid the entire year’s worth of childcare, but the child only lived with them 50% of the time, they can only deduct the 50%. Also if one of the parents has a new spouse, it would go on the lower income return of the new relationship.