Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Principal Issues: Whether an individual who becomes an "eligible individual" as a "shared-custody parent" for purposes of the CCTB can retroactively claim for the benefit, assuming all eligibility criteria are met?
Position: Generally yes
Reasons: An individual cannot be considered an eligible individual for a particular month until they meet the eligibility criteria for being an eligible individual in that month, and apply for the CCTB for that month. An individual cannot be considered to be an eligible individual at the beginning of a month, unless they have filed the prescribed forms and prescribed information within 11 months of the end of that month.
December 13, 2013
We are replying to your email of July 24, 2013 in which you asked for our comments regarding an individual becoming a "shared-custody parent" of a qualifying dependent for purposes of the Canada Child Tax Benefit ("CCTB") and their ability to claim the CCTB retroactively, assuming all of the eligibility requirements for the CCTB are met.
You have also requested copies of the legislation related to your questions.
This technical interpretation provides general comments about the provisions of the Income Tax Act (the "Act") and related legislation (where referenced). It does not confirm the income tax treatment of a particular situation involving a specific taxpayer but is intended to assist you in making that determination. The income tax treatment of particular transactions proposed by a specific taxpayer will only be confirmed by this Directorate in the context of an advance income tax ruling request submitted in the manner set out in Information Circular IC 70-6R5, Advance Income Tax Rulings.
The Canada Revenue Agency's (CRA) general views regarding the CCTB are contained in Guide T4114 Canada Child Tax Benefit which can be found here:
New rules related to the CCTB came into effect as of July 2011. This interpretation refers to the rules as of that date.
For purposes of the CCTB, an "eligible individual" in respect of a qualified dependant is defined under section 122.6 of the Act. There are numerous conditions that must be met to qualify, including that the person is a resident in Canada, and is the parent of, and resides with, the qualified individual and is either (i) the parent who primarily fulfills the responsibility of care and upbringing of the qualified dependent (but is not a shared-custody parent), or (ii) is a shared-custody parent of the qualified dependent.
A "qualified dependant" is also defined under section 122.6 of the Act and means a person that has not reached the age of 18, but excludes a person in respect of whom either a special allowance is payable under the Children's Special Allowances Act or a wholly dependent person tax credit has been claimed for the base taxation year.
Subsection 122.62(6) states that in situations where there has been a separation from a cohabitating spouse or common-law partner that has occurred after June 2011, the eligible individual must notify the Minister in prescribed form before the end of the first calendar month that begins after the event. This is a mandatory requirement. If the change in status results in a change to the CCTB amount, the revised amount that the eligible individual is entitled to becomes effective in the month following the change in status.
Where a separation between cohabitating spouses or common law partners has occurred, an individual must meet certain criteria in order to be considered a "shared-custody parent", for purposes of the definition of "eligible individual". The individual must be one of the two parents of the qualified dependant who are not cohabitating spouses or common-law partners of each other and who reside with the qualified dependant on an equal or near equal basis. They must also primarily fulfill the responsibility of care and upbringing to the qualified dependant when residing with the qualified dependant.
If an individual is a shared-custody parent who meets all of the requirements of being an "eligible individual" and is entitled to the CCTB, they will receive CCTB amounts equal to 50% of the amount they would have received if the child resided with them on a full-time basis.
An individual cannot be considered an eligible individual for a particular month until they meet the eligibility criteria for being an eligible individual in that month, and apply for the CCTB for that month. Subsection 122.62(1) also states that an individual cannot be considered to be an eligible individual at the beginning of a month, unless they have filed the prescribed forms and prescribed information within 11 months of the end of that month.
Subsection 122.62(2) does allow the Minister to extend the time for filing under 122.62(1), but this is discretionary, not mandatory.
If an amount for the CCTB has been paid to an individual that was in excess of what they were entitled to, the person will be required to repay the amount of the overpayment.
You can find the requested legislation discussed above on the Justice Laws Website found here - http://laws-lois.justice.gc.ca/eng/acts/I-3.3/index.html
We trust our comments will be of assistance.
Business and Employment Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch
All rights reserved. Permission is granted to electronically copy and to print in hard copy for internal use only. No part of this information may be reproduced, modified, transmitted or redistributed in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, or stored in a retrieval system for any purpose other than noted above (including sales), without prior written permission of Canada Revenue Agency, Ottawa, Ontario K1A 0L5
© Her Majesty the Queen in Right of Canada, 2013
Tous droits réservés. Il est permis de copier sous forme électronique ou d'imprimer pour un usage interne seulement. Toutefois, il est interdit de reproduire, de modifier, de transmettre ou de redistributer de l'information, sous quelque forme ou par quelque moyen que ce soit, de facon électronique, méchanique, photocopies ou autre, ou par stockage dans des systèmes d'extraction ou pour tout usage autre que ceux susmentionnés (incluant pour fin commerciale), sans l'autorisation écrite préalable de l'Agence du revenu du Canada, Ottawa, Ontario K1A 0L5.
© Sa Majesté la Reine du Chef du Canada, 2013