7 Tax Credits and Final Tax Calculation

Canadian Tax Fundamentals · 4:48

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Lyrics

[Verse 1]
When you've calculated all your income tax
There's still more work before you can relax
Credits come in two different kinds you see
Non-refundable and refundable, let me explain these

Basic personal amount for everyone
Spousal credit when two become one
Dependant credit for those you support
Age and disability, medical of all sorts

[Chorus]
Credits reduce the tax you owe
Some are capped, some help you grow
Non-refundable stops at zero
Refundable makes you the hero
Section one-eighteen to one-eighteen-nine
These credits help your bottom line

[Verse 2]
Tuition fees and charitable giving too
Medical expenses over threshold due
These non-refundable credits have their place
They lower taxes but won't increase your space

Below zero they will never go
But refundable credits steal the show
GST credit comes back to you
Canada Workers Benefit pulls you through

[Chorus]
Credits reduce the tax you owe
Some are capped, some help you grow
Non-refundable stops at zero
Refundable makes you the hero
Section one-eighteen to one-eighteen-nine
These credits help your bottom line

[Bridge]
Climate Action Incentive pays you back
Provincial credits fill the gap you lack
Calculate provincial tax as well
Each province has its own story to tell

Alternative Minimum Tax watch out
Twenty twenty-four brought changes about
Higher exemption, broader base
Make sure AMT doesn't win the race

[Verse 3]
Federal tax times provincial rate
Add them together, don't be late
Credits applied in order due
First non-refundable, then refundable too

Final calculation shows what's owed
Or if refund comes down the road
Seven types of credits in your hand
Help you navigate this tax law land

[Chorus]
Credits reduce the tax you owe
Some are capped, some help you grow
Non-refundable stops at zero
Refundable makes you the hero
Section one-eighteen to one-eighteen-nine
These credits help your bottom line

[Outro]
From basic personal to climate care
Tax credits lighten the load you bear
Calculate wisely, apply each rule
These seven credits are your tax law tool

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