Tax credit for using public transit

[alajen]

I heard about this on the radio, so looked it up on the website. Save money while saving the environment.

The Federal Government is offering a tax credit on your return for purchasing a transit pass. Here is a summary (full details are on www.transitpass.ca)

Tax Credit for Public Transit Passes
What is the tax credit for public transit passes?

On July 1, 2006, the Government of Canada began its program to offer individual Canadians a non-refundable tax credit to help cover the cost of monthly or longer duration public transit passes. Because it is a non-refundable tax credit, anyone who applies does not receive the money in the form of a refund. Instead, the amount claimed is multiplied by the lowest personal income tax rate for the year (15.25% in 2006) and then is deducted from the amount of tax owed for that year. Visit the Canada Revenue Agency website for additional information about how to qualify and claim the credit.
What does that mean for me?

If your monthly pass costs $100, your tax credit in 2006 would be $91.50 (six months multiplied by 15.25%). Remember, the program commenced as of July 1, so only six months of passes will be calculated for the credit in 2006. In 2007, when the lowest marginal tax rate will increase to 15.50% and the tax credit for public transit passes can be applied to the whole year, the credit could reduce your taxes by as much as $186.
You will be eligible to claim the tax credit for public transit passes on your 2006 income tax return for the amounts you have paid for travel that occurs after June 30, 2006, but you must have proof of purchase. At a minimum you need to keep your expired monthly transit passes for months after June 2006 to support your claim. Visit the Canada Revenue Agency website for additional information about how to qualify and claim the credit.

[bcteagirl]

thanks!

[alajen]

You are most welcome...

Keep in mind that it is important to keep all your receipts as well as the transit pass (as heard on the radio).