Marital Status & Your Tax Return


What is your marital status?  

 This seems like a very easy question, after all there can only be two possible answers; married or single right?

 Well it is not as easy a question as it appears on the surface.  There is actually a third option; Living in Common-Law.  

 We can agree that if you have a spouse this means that you are legally married.  You are legally married through a religious institution or City Hall.  What ever route chosen the government recognizes that you and your spouse have a legal commitment to each other that we call marriage.  You are even given a certificate to prove it!  

 Note that If you have not gone the legal marriage route you are not necessarily single.

Living in Common-Law

You are Living in Common-Law when you are living with a person who is not your spouse, have a conjugal relationship with this person, and at least one of the situations detailed below is true:

You have been living with this person in a conjugal relationship for at least 12 continuous months (being separated for less than 90 days due to a breakup in this 12 month period)

The person you are living with is a parent of your child (via birth or adoption);

The person you are living with has custody and control of your child (or had such custody before your child turned 19 years of age) and your child is wholly dependent on this person for support.

Living in Common-Law is defined by your relationship, time and/or parentage / custody of your child.

Impact of Living in Common-Law to Your Income Tax Return

There is a direct impact to the Canada child tax benefit (CCTB), Universal child care benefit (UCCB), GST/HST credit and the working income tax benefit as these programs are based on the family income.  Family income includes the taxpayers income plus the income of the taxpayer’s spouse or common-law spouse.  If both common-law spouses have taxable income the payments under these programs can be reduced significantly and/or eliminated due to the family income test.

 The tax credits and the sharing of tax credits available to a married couple are also available to a couple who is common-law.  Tax credits for dependant spouse and children are available, and the sharing of the public transit, children’s art, children’s fitness, disability, tuition, education, and textbook, medical, and donation tax credits is allowed between both married and common-law couples.

 If you are considered to be common-law couple for tax purposes you are treated identical to a couple who is married.  

 It is advisable to seek professional advice to understand the tax laws that impact your particular situation, and to guide you through the complexities of Canadian Income taxes.

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