# Line 423 - Family Tax Cut



## Tetsujin (Mar 17, 2016)

I was reading that I can apply to this credit in order to reduce tax. Married living together but with no kids. My wife is unemployed.

So, using ImpôtExpert , I selected the option to ask for this CUT, but it doesn't affect the final result. Can someone help me to understand the difference between line 497 and 498? As I said my wife is not working and doesn't earn any dollar. I think that I can answer for both of them as YES but don't understand both underlined questions. I get the taxable income but what is the difference with "spouse amount" part?

*Schedule 1-A - Family tax cut*

- Claim the family tax cut? * SELECTED OPTION = [CLAIM THE FAMILY CUT]*

- If the Family tax cut is claimed, please select Yes to confirm that you had a child under the age of 18 at the end of the year. (see your Schedule 1-A) *SELECTED OPTION = [NO]*

- If applicable (click ? for details), please select Yes to confirm that your spouse's taxable income is NIL. (see your Schedule 1-A, line 497) *SELECTED OPTION = [YES]*

- If applicable (click ? for details), please select Yes to confirm that the spouse or common-law partner amount is NIL. (see your Schedule 1-A, line 498) *SELECTED OPTION = [YES]* 

- If applicable (click ? for details), please select Yes to confirm that the amounts transferred from your spouse or common-law partner is NIL. (see your Schedule 1-A, line 499) *SELECTED OPTION = [YES]*


Is this Schedule 1 -A related to the Line 303 question? (Are you eligible to claim the spousal amount (line 303) on your return? = YES) 

I support my wife economically and filled out the "SOURCE DEDUCTIONS RETURN 2015" at my job at the beginning of the 2015. 

Thanks in advance.


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## AltaRed (Jun 8, 2009)

The first NO eliminates the Family Tax Cut (income splitting). A couple is not a family for this tax benefit. You can only get the Spousal amount.


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## Tetsujin (Mar 17, 2016)

Thanks for your answer. I thought that I could ask for this, because the website doesn't mention explicitly that we need to have kids to request for this credit (http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/ddctns/lns409-485/423-eng.html). But as you said maybe I am misinterpreting the concept of family according to law. 

Even if I simulate to answer YES to the first question I don't see the software adding the cut in the income tax declaration. Maybe because I'm requesting the "Line 303 - Spouse or common-law partner amount"?

Again, thanks for your answer. Really appreciated.


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## AltaRed (Jun 8, 2009)

From your link, did you not see this part?


> You or your spouse or common-law partner must have also ordinarily lived throughout the year with your child who is under 18 years of age at the end of the year. Because of a joint custody arrangement, your child may have ordinarily lived with both you and your former spouse or common-law partner throughout the year.


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## Tetsujin (Mar 17, 2016)

Thanks for clarification.


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## pwm (Jan 19, 2012)

I'm bumping this thread because I just completed my daughter's tax return. She had a lower income in 2015 than in previous years and her husband got a raise in pay so their taxable income has diverged from last year when it was almost the same. They have 2 children under 18. I had entered all the numbers into the tax software (FutureTax), and was ready to tell them the results when I remembered the Family Tax Cut. (schedule 1-A.) After applying the family tax cut, my son in law's refund went up by $300!

Just a reminder to everyone with children where both spouses work, and have a disparity in income: _Don't forget to include a schedule 1-A while you still _can!


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## AltaRed (Jun 8, 2009)

Would it not be more accurate to say IF if there is a disparity in marginal tax rate?


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## pwm (Jan 19, 2012)

Right you are. My daughter was in the first bracket and her husband was in the second.


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