When is advance care planning day?
Advance Care Planning Awareness Day is April 16. It is meant to instigate conversations between family members and close friends about their wishes. Talk with your loved ones about what would happen if you or they weren’t able to make decisions.
How much does it cost to care for aging parents?
According to a survey conducted by the Petro Canada CareMakers Foundation, the average annual out of pocket expenses of caring for an elderly parent in Canada is $6,000, depending on the level of care needed. This financial burden totals $48 billion a year for Canadians. The costs increase with expenses such as home healthcare services, medications and home renovations.
In addition to the direct financial costs, caring for an aging parent can also have a significant impact on the adult child’s career. Many caregivers must reduce their work hours or leave their jobs entirely to provide the necessary care, resulting in lost income and potential career advancement opportunities. Reducing work hours or having to leave a job to care for a parent causes “63% of caregivers to report experiencing financial hardship connected to their caregiving duties,” according to the National Caregiving Survey. This particularly affects women as more than half of women in Canada are caregivers, which leaves fewer females in the workforce as our population ages. Not to mention the emotional and physical toll of being a caregiver can also be significant. Adult children may find themselves balancing the demands of their own families, work and personal lives with the responsibilities of caring for an aging parent, leading to feelings of stress, guilt and burnout.
Now, it is not all doom and gloom. As the first-born daughter in a large Portuguese family, I have seen caregiving done well and with a few bumps along the way. To help alleviate some of the financial burden on both the parent and the adult child, here are some tips I have learned.
Are there any tax credits and claims for parent caregivers?
In Canada, there are several government programs and benefits available to support caregivers, such as the Canada caregiver credit and the Home Accessibility Tax Credit (HATC). These programs can help offset some of the costs associated with caring for an aging parent. Let’s explore the credits a bit deeper.
What is the Canada caregiver credit?
This is a non-refundable tax credit that is available to anyone who has provided care to a spouse, common-law partner or dependant at any time during the year. To clarify, a dependant can be:
- A child or grandchild
- A parent, grandparent, brother, sister, uncle, aunt, niece or nephew (if they lived in Canada at any time during the year)
According to the Canada Revenue Agency (CRA): “an individual is considered to depend on you for support if they rely on you to regularly and consistently provide them with some or all of the basic necessities of life, such as food, shelter and clothing.”
The amount that can be claimed for the Canada caregiver amount varies depending on your relationship to the person you are making the claim for. Working with an accountant or financial advisor would be the best approach to ensure you are utilizing the right credit amount on your tax return. Additionally, the CRA may request a signed letter from a medical practitioner showing when the impairment began and what the duration of the impairment is expected to be.
Discussion about this post