Changes to government benefits for families with children in 2015

This is a subject that has  come up often in our facebook group – here’s a great guest post by Corey that really helps to clear up the confusion!

There is so much confusion on the changes to the Universal Child Care Benefit and Child Tax Credit that I hope this post helps people understand.

I will start with explanations of these terms:
– Universal Child Care Benefit (UCCB): This is a monthly benefit meant to help parents pay for child care. If you have children under 6 years old then you would have been receiving $100 per month per child under 6 on the 20th of the month. This is increasing by $60 per child per month for every child. Children under 6 will receive $160 and children 6-18 years old will receive $60 per month.

– Child Tax Credit (CTC): This is the amount you claim on your taxes on line 367. It gives you a federal tax credit of $338 (as of the 2013 tax year) on your taxes. This is being eliminated in 2015. This is a non refundable tax credit, which is used to decrease the amount of federal tax you owe. It does NOT give you $338 back at tax time. It is an amount that is used to bring your federal tax payable down

– Canada Child Tax Benefit (CCTB): This is the amount you are paid based on your income on the 20th of the month.  This is NOT changing.

Here is a scenario:  Jessica has 2 children, Josh is 2 and Amy is 8. She currently receives $589 for CCTB and $100 for UCCB for Josh
every month on the 20th. At tax time she claims 2 children on line 367 which reduces her tax owing by $676 on her tax return.
The new UCCB amounts go into affect in January 2015 but the payments will not start until July 20th, 2015. On July 20th in the above scenario Jessica will receive back pay from January to June 2015 in the amount of $720 + the new UCCB payment amount for July of $220. So, on July 20th, 2015 Jessica will receive a total cheque of $940 which will catch her up on the new UCCB amount. On August 20th she will
receive $220, which is her new UCCB monthly amount, up from $100 she was getting in 2014. She still receives the payment from CCTB in the amount of $589.

So, with these changes there is no way that, if you have children, you will not come out ahead. Everybody, no matter what your income is, will be getting $60 more per child, per month. They are NOT taking away, or reducing any monthly payments from you. Your CCTB remains the same, plus you get $60 more per child, per month. You may have slightly more tax withheld on your paycheque, however it would amount to less than $30/month/child (and remember – you are getting an extra $60/month/child)