Hypothetical scenario for now but I’m curious in case I run into this which I might this year.
As per CRA, “You may be able to claim the amount for an eligible dependant if, at any time in the year, you supported an eligible dependant and met certain conditions.”
Since it is “at any time in the year” I’ve claimed eligible dependent for a person who Marital Status changed in the year to either be in or out of a marriage/common-law relationship. What I’m wondering is can each spouse claim an eligible dependant if they both started the year as single/divorced/separated/widowed and had their own dependants who weren’t being claimed by another taxpayer (example: their exs)?
I’ve been playing around in Taxcycle and it doesn’t seem to let me. If I select one dependant as an eligible dependent it removes any other dependant as being eligible. Even if I indicate dependant A lived with spouse X and dependent B lived with spouse Y.
Under “Situations where you cannot claim the amount for eligible dependant” CRA indicates a reason to not be able to claim as “another person in your household is making this claim”. I suspect this is why TaxCycle is not letting me do it. My argument would be for a portion of the year they weren’t living in the same household.
Curious if anyone has experienced this situation or has any input as I love learning.
Although CRA uses the term “household”, in the Act the term is “self-contained domestic establishment”, and the provision allowing the dependent amount does seem to refer to supporting a dependent at “that” domestic establishment at any time during the year, which does suggest you may be able to have more than one self-contained domestic establishment during a year. CRA’s published guidance does not address this possibility. A quick search doesn’t reveal any relevant case law or rulings, though there may be something out there.
Only one of the parents would be able to claim the eligible dependant. Even if they were roommates and not together, only one would be able to claimed at that address. CRA is very clear on this in their distinction and that if it comes down it, the people at that address have to decide who claims it, and if more than one person claims it, everyone gets denied.
It comes down to are you both living at the same address as of December 31st. I’ve had to deal with this on a review of a client’s file with a previous accountant and CRA denied both people’s claims because only one was allowed and they couldn’t agree on who was claiming it.
Of course CRA is going to deny it, the question is whether that actually follows the law. The provision in the Act certainly seems to suggest that if any time in the year, you lived in a self-contained domestic establishment and supported a dependent, you can make the claim, regardless of whether you later moved to a different self-contained domestic establishment, since the Act refers to the domestic establishment you lived at when you supported the dependent.
It’s unsurprising that CRA’s policy would be to deny it in such a case. But I do wonder if there’s actual case law to support that interpretation.
Not that I found, as I tried the same argument but couldn’t find any case law to support it and the client wasn’t willing to incur the costs to take it to court.
Comes down to where everyone lived as of December 31 that year until someone takes CRA to court to find otherwise.