About the Ontario Child Care Tax Credit - February 26, 2020

Making child care more affordable

Ontario’s new child care tax credit was created to help parents with the costs of child care and to afford a broad range of care options, including: child care centres, home-based child care, and camps.

The Ontario Child Care Tax Credit will provide families with up to 75 per cent for their annual, eligible child care expenses. Families could receive up to:

• $6,000 per child under age seven;
• $3,750 per child between the ages of seven and 16; and
• $8,250 per child with a severe disability.

Starting with the 2019 tax year, families can claim the child care tax credit. Parents just need to have proof, such as receipts for the child care expenses they incurred, when they file their claim on the 2019 tax return.

It’s important to note that the Ontario Child Care Tax Credit is in addition to support provided through the Child Care Expense Deduction and child care fee subsidy. This means that there is both provincial and federal relief for families toward eligible child care expenses.
 

Who will benefit from the child care tax credit

The child care tax credit supports families with incomes up to $150,000, particularly those with low and moderate incomes.

To claim the child care tax credit, a tax filer must:

• be eligible to claim the Child Care Expense Deduction;
• have family income less than or equal to $150,000; and
• be an Ontario resident at the end of the tax year.
   

Expenses eligible for the tax credit

Child care expenses that are eligible for the Child Care Expense Deduction will be also eligible for the child care tax credit.

Eligible expenses include payments to:

• Licensed child care centres – in a school, place of worship or standalone;
• Licensed home-based child care services;
• Caregivers providing unlicensed child care services;
• Day camps and sports schools where the primary goal of the camp is to care for children.
   

How the child care tax credit is calculated

The child care tax credit is based on the following tax filer’s situation that includes:

• Family income, which is based on the income of the family members used in determining the tax filer’s Child Care Expense Deduction; and
• Eligible child care expenses, defined as the tax filer’s total entitlement under the Child Care Expense Deduction.

Learn more about the Ontario Child Care Tax Credit, at www.ontario.ca/childcarecredit.