2022-2023 Ontario Budget Tax Measures - Summary of Highlights - Crowe BGK

2022-2023 Ontario Budget Tax Measures - Summary of Highlights

Aaron Patrick Belcher, CPA, CGA & Victoria Chen, MTax
4/29/2022
2022-2023 Ontario Budget Tax Measures - Summary of Highlights - Crowe BGK

The Ontario Minister of Finance, Peter Bethlenfalvy, delivered the 2022 Budget on April 28, 2022. The 2022 Budget aims at better employment and higher wages, more infrastructure, and lower costs for families. Ontario is projecting a budget deficit of $19.9 billion in 2021-2022, which is expected to fall to $10.8 billion in 2022-2023.

The following is a summary of the Ontario provincial government’s proposed tax measures based on its 2022 Budget.

Measures Affecting Individuals


Low-Income Individuals and Families Tax Credit Enhancement

The government proposed an enhancement to the non-refundable low-income individuals and families tax credit (LIFT). The credit was initially introduced in 2019 and entitled lower-income taxpayers to up to $850 in tax reductions against Ontario personal income tax.

Starting in 2022, the enhanced LIFT Credit would be calculated as the lesser of:

  • $875; or
  • 5.05 percent of employment income.

This amount would then be reduced by five per cent of:

  • Adjusted individual net income in excess of $32,500; or
  • Adjusted family net income in excess of $65,000.

Ontario Seniors Care at Home Tax Credit 

In the 2022 provincial budget, a new refundable Ontario Seniors Care at Home Tax Credit was introduced to assist seniors living at home. The credit is calculated on eligible expenses for seniors who still live at home and receive home care from a nurse, attendant or other medical services.

Eligible expenses include:

  • Attendant care (certification required);
  • Care of a provincially authorized medical practitioner (e.g., nurse, occupational therapist);
  • Dental, vision and hearing care (e.g., glasses, dentures, hearing aids);
  • Walking aids (e.g., walkers, canes);
  • Wheelchairs and electric scooters;
  • Bathroom aids (e.g., grab bars, grips, rails);
  • Diapers and disposable briefs;
  • Hospital beds;
  • Oxygen and assisted breathing devices; and
  • Renovation or construction that improves a person’s mobility, access or functioning within the home because of severe and prolonged impairment.

 

In order to be eligible for the tax credit, the taxpayer or their spouse must be an Ontario resident at year end and 70 years of age or older in the year. The proposed credit would be 25 per cent of claimed medical expenses, up to a maximum credit of $1,500. This amount would be reduced by five per cent of family net income over $35,000 and be fully phased out at family net income of $65,000. This family net income test is applicable to both single individuals and couples.

Measures Affecting Businesses


Extending the Temporary Enhancement of the Regional Opportunities Investment Tax Credit 

During the 2021 Ontario budget, the provincial government introduced the Temporary Enhancement of the Regional Opportunities Investment Tax Credit. The government is proposing to extend the temporary enhancement to the Regional Opportunities Investment Tax Credit until the end of the 2023 calendar year, giving businesses more time to make use of the enhanced support. Canadiancontrolled private corporations that make qualifying investments in eligible geographic areas of Ontario would be eligible for a 20% refundable credit of eligible expenditures. Further details may be found in the 2021-2022 Ontario Budget Summary.

For more information, please refer to the Minister of Finance website.

  

Prepared by:

Aaron Patrick Belcher, CPA, CGA is a Tax Manager at Crowe BGK

Connect with him: [email protected]

Victoria Chen, MTax is a Tax Specialist at Crowe BGK

Connect with her: [email protected]