Child-Related Costs Add Up… Don’t Let the Tax Savings Slip Away

If you’re a parent, you already know how quickly the bills start adding up.

As one school year wraps up, you’re registering for summer camps. Before you know it, you’re paying school fees and signing up for hockey, dance, gymnastics, music lessons, swimming, and countless other activities that somehow fill the family calendar.

It’s easy to think of these as simply “the cost of raising kids.”

But here’s some good news. Some of these expenses may provide valuable tax savings, provided you keep the proper documentation. One of the biggest mistakes we see every tax season isn’t that people don’t qualify for deductions or credits. It’s that they simply forgot to keep the receipts.

Summer Is More Than Just Vacation

For many parents, summer isn’t really a break. It’s a juggling act. Finding childcare while school is out can become one of the largest expenses of the year, especially for families with multiple children.

Fortunately, many of these costs may qualify as childcare expenses for income tax purposes.

Depending on your family’s circumstances, eligible expenses can include:

• Licensed daycares
• Summer day camps
• Overnight camps
• Private childcare centres

These deductions can make a meaningful difference on your tax return, particularly for families paying for several weeks of care during July and August.

Remember to ask for receipts as you go. Waiting until next spring to track them down can be frustrating and sometimes impossible.

The School Year Brings a New Set of Expenses

Just as summer ends, another wave of expenses begins.

Registration fees seem to arrive all at once: activity registrations, lunch programs, and before-school care and after-school care.

While not every school-related expense is deductible, several commonly overlooked costs may qualify as childcare expenses, including:

• Before-school programs
• After-school programs
• Lunch supervision or lunch programs (where they qualify)
• Certain eligible private school fees related to childcare

These expenses often occur in small amounts throughout the year, making them especially easy to overlook by tax time.

Don’t Forget About Sports and Arts

Many Manitoba families spend hundreds, and sometimes thousands, of dollars each year keeping their children active. Whether your child loves hockey, soccer, baseball, dance, gymnastics, theatre, music, or art classes, those registration fees are another category of receipts worth saving.

Although these expenses are not generally deductible for federal income tax purposes, in some years, Manitoba has offered provincial tax credits for certain children’s fitness and arts programs, so it’s worth checking what’s available.

Small Receipts Become Big Savings

Think about everything a family might pay over the course of a year:

• Up to eight weeks of summer camps
• Before-school care
• After-school care
• Lunch supervision
• Music lessons
• Dance registration
• Hockey fees
• Soccer registration

No single receipt may seem particularly important, but together, they can represent thousands of dollars in family expenses over a year.

Create a Simple Habit

One of the easiest habits you can develop is to save your receipts the moment you receive them.

Even if you’re unsure whether an expense will qualify, keep the receipt anyway.  It’s always easier for your accountant to determine whether something is eligible than it is to track down missing receipts later.

At Accent CPA, we believe tax planning isn’t something that only happens in March and April. The best tax outcomes often come from good habits throughout the entire year.

That’s why we’re always happy to answer questions about whether an expense should be saved, and why we provide our clients with a free secure online portal where digital receipts can be securely uploaded and stored all year long. When tax season arrives, everything is already organized and ready to go.

Our goal is to make tax season less stressful while helping you maximize every deduction and credit available to your family.

If you have questions about childcare expenses, school-related costs, or other family tax benefits, we’d love to help. At Accent CPA, we’re proud to provide Trusted Advice and Personal Service every step of the way.

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