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Income Tax Act s. 122.7
Working income tax benefit
The working income tax benefit (WITB) is a federal refundable tax
credit which is available starting in 2007, for low-income individuals or
families with working income over $3,000 (base amount). The calculations
for BC, Québec, and Nunavut differ. The calculation for Alberta will
differ starting in 2009. See the links below for tables showing summaries
of the amounts used in each province/territory.
The WITB is calculated on Schedule 6 of the income tax
return, and is then entered on line 453 on page 4 of the tax return.
Summary of amounts for WITB
We have compiled tables which summarize all of the amounts related to the calculation of the WITB, including base amounts of working
income, percentages used in the calculation, maximum WITB benefit, and income
amounts above which the WITB is not available.
2010 amounts - all
provinces and territories except Québec
The 2010 amounts have been calculated by applying the
Federal indexation factor to the 2009 amounts.
For the CRA information on the working income tax benefit,
and to get Schedule 6 on which it is calculated, see the CRA web page Line
453 - Working income tax benefit.
The Canadian
Tax Calculator includes a calculation of the WITB, but it requires you to
indicate whether or not you are eligible to receive the WITB. If you
indicate that you qualify, the calculator will determine the amount you will
receive, if any, based on your income. Read the following information to
determine the correct answer to that question.
The following people qualify for the WITB, depending on
income, unless they fit the description of an ineligible individual:
single individual 19 years of age or older at the end
of the year:
resident in Canada throughout the year, and
not enrolled as a full-time student for more than
13 weeks in the year
individual under 19 years of age at the end of
the year:
resident in Canada throughout the year, and
living with a spouse or common-law partner at the
end of the year, and
not enrolled as a full-time student for more than 13
weeks in the year
single parent family, including parent under 19 years
of age:
resident in Canada throughout the year, and
primary caregiver of a dependant child (under 19 at
end of year) in Canada at
the end of the year
couple:
with no dependent children who are under 19 at end
of year and residing with them:
both residents of Canada throughout the year, and
not enrolled as full-time students for more than 13
weeks in the year
if one spouse is
enrolled as a full-time student for more than 13 weeks in the year,
then the non-student spouse is eligible for the WITB as a single
individual.
with dependent children who are under 19 at the
end of the year, and residing with them:
both residents of Canada throughout the year
if one spouse is not resident of Canada throughout
the year, the resident spouse may be eligible for the WITB as a single
individual or parent if the applicable eligibility criteria are met.
An ineligible individual is an individual:
who is an employee of the government of a country other than Canada, or a
member of the employee's family;
who, unless they have an eligible dependent, was
enrolled as a full-time student for more than 13 weeks in the year at a
designated educational institution (this would be a program for which the education
amount tax credit is available); or
who was confined to a prison or similar institution for
a period of at least 90 days during the taxation year
Working income includes:
income from office or employment (includes director's
fees)
taxable income from scholarships and
research grants
income from a business carried on by the individual,
excluding losses
Adjusted net income
Adjusted net income is the individual's net income from line 236 of the tax
return, less any Universal Child Care Benefits (UCCB).
Amount of WITB for 2009
Maximum refundable tax amount from WITB for all provinces
and territories except Alberta, BC, Nunavut and Québec:
$925 per year for a single individual
$1,680 per year for an individual with an eligible
spouse or eligible dependant
The WITB can only be claimed by one spouse.
The WITB is 25% of working income over $3,000 (base amount), to the above
limits, but is then reduced by:
for a single person with no dependants, 15% of the
amount, if any, by which the individual's adjusted net income for the year
exceeds $10,500 (adjusted net income base amount)
for an individual with an eligible spouse or eligible
dependant, 15% of the amount, if any, by which the total of the adjusted
net incomes of the individual and, if applicable, the eligible spouse,
exceeds $14,500.
For 2009, the maximum WITB tax refund would be reached in most provinces/territories
for a single person, at $6,700 or more of working income, and
$10,500 or
less of adjusted net income
for an individual with an eligible spouse or eligible dependant, at
$9,720 of combined working income, and $14,500 or less of combined
(individual and spouse) adjusted net income.
For 2009, the WITB will be reduced to zero in most provinces/territories
for a single person with $16,667 or more of adjusted net income
for an individual with an eligible spouse or eligible dependant, with
$25,700 or more of combined (individual and spouse) adjusted net income
Disability supplement 2009
The WITB will include an additional disability supplement for each
individual (other than a dependant) who is eligible for the disability tax
credit (DTC). The calculation differs for BC, Québec, and
Nunavut. See the table below for a summary of the amounts used in each
province/territory.
The maximum WITB disability supplement is $427 per year.
The WITB disability supplement can only be claimed by one spouse.
The WITB disability supplement is 25% of working income over
$1,150 (base amount), to a maximum of $250, but is reduced by:
for a single person with no dependants, 15% of the
amount, if any, by which the individual's adjusted net income for the year
exceeds $16,667; or
for an individual with an eligible spouse or eligible
dependant, 15% of the amount, if any, by which the total of the adjusted
net incomes of the individual and, if applicable, the eligible spouse,
exceeds $25,700; or
for an individual with an eligible spouse who is also
entitled to the disability tax credit, 7.5% of the amount, if any, by
which the total of the adjusted net incomes of the individual and spouse
exceeds $25,700.
Individuals and families who are
eligible for the WITB can apply to CRA for a prepayment of one-half of their estimated WITB, as long
as the estimated WITB is at least $200 for the year. Evidence must be
provided of expected earned income and proof of residency in Canada. Prepayments will be made as part of the
Goods and Services Tax Credit (GSTC) payment cycle. For more information
see the CRA web page WITB:
Application and Eligibility.
Eligible individuals and families can apply for the
prepayment on their tax return, or by using the CRA form RC201
WITB Advance Payment.
A recipient of a prepayment must file a tax return for the
year in which the prepayment is received. If a prepayment becomes
repayable to the government, interest will be charged in the same manner as
interest on underpayments of income tax. If a prepayment has been made
for a taxation year, no prepayment will be made for a subsequent tax year
until the tax return for the earlier year is filed.
The information on this site is not intended to be a
substitute for professional advice. Each person's situation differs, and
a professional advisor can assist you in using the information on this web
site to your best advantage.
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