Table of Contents

• Form ON428, Ontario Tax
• Step 3 - Ontario tax
• Step 4 - Ontario tax reduction
• Step 5 - Ontario investment and employee ownership (OIEO) tax credits
• Form ON479, Ontario Credits
  • Income for Ontario tax credits
  • Did you have a spouse in 2000?
  • Deceased person
  • Were you an international student in 2000?
  • Were you bankrupt in 2000?
• Property tax credit
  • Occupancy cost (lines 4 to 7)
• Sales tax credit
• Ontario political contribution tax credit
• Ontario home ownership savings plan (OHOSP) tax credit
• Ontario tax credits for self-employed individuals
• Co-operative education and graduate transitions tax credits
• OHOSP tax credit factor table

The information on the following pages will help you complete Form ON428, Ontario Tax, and Form ON479, Ontario Credits. It also provides information about Ontario credits and will help you determine whether you are eligible to claim any or all of them.

The term spouse used on these forms is defined on page 11 of the General Income Tax and Benefit Guide.

The term dependent child refers to a child born in 1982 or later of whom you are the parent (legal or in fact) and who, in 2000, lived with you and was resident in Canada. A child for whom anyone claims an equivalent-to-spouse amount on line 305 of his or her return may be a dependent child. However, a child for whom anyone claims a spousal amount on line 303 or receives an amount under the federal Children's Special Allowances Act is not a dependent child

Form ON428, Ontario Tax

Complete Form ON428 if you were a resident of Ontario at the end of the year. The term end of the year means December 31, 2000, the date you left Canada if you emigrated in 2000, or the date of death for a person who died in 2000.

You also have to complete Form ON428 if you were a non-resident of Canada in 2000 and you earned income from employment in Ontario, or received income from a business with a permanent establishment in Ontario.

If you had income from a business with a permanent establishment outside Ontario, complete Form T2203, Provincial and Territorial Taxes for 2000 - Multiple Jurisdictions, before you complete Form ON428.

Step 3 - Ontario tax

Before you complete Step 3, be sure to complete Step 1 and Step 2 as you will need this information to calculate your Ontario tax.

Line 14 - Ontario tax on split income

Certain income of a child who was under 18 on December 31, 2000, is subject to a special tax. For details on the types of income to which this tax applies, see page 14 in the General Income Tax and Benefit Guide.

If you are under 18 and have to pay tax on split income, complete Part 2 of Form T1206, Tax on Split Income, to calculate the provincial tax that applies to this income. Form T1206 also contains a special rule that applies to the amount you enter on line 428 of your return.

Line 23 - Ontario additional tax for minimum tax purposes

If you have to pay minimum tax as calculated on Form T691, Alternative Minimum Tax, you will have to determine your Ontario additional tax for minimum tax purposes. To do this, complete Form T1219, Provincial Alternative Minimum Tax, and enter the calculated amount on line 23 of Form ON428. You can find information about minimum tax on page 37 in the General Income Tax and Benefit Guide.

Step 4 - Ontario tax reduction

If you were a resident of Ontario on December 31, 2000, you may be able to reduce or eliminate your Ontario tax by claiming an Ontario tax reduction. If you are preparing a return for a person who died in 2000, you can claim the tax reduction on that return.

Only one person can claim the reduction for a dependent child or a disabled or infirm dependant (line 32 and line 33). If you had a spouse on December 31, 2000, only the spouse with the higher net income (line 236 of the return) can make these claims.

You cannot claim the tax reduction if you were subject to minimum tax as calculated on Form T691, Alternative Minimum Tax.

Line 32 - Reduction for dependent children born in 1982 or later

Enter at box 6269, the number of dependent children you have. See the definition of a dependent child at the beginning of this page.

Claim $317 for each dependent child.

If the child is disabled or infirm, you can claim an additional $317 for that dependant on line 33.

Line 33 - Reduction for disabled or infirm dependants

Enter at box 6097, the number of disabled or infirm dependants for whom you or your spouse claimed an amount on line 305, 306, or 318 of the return.

Also include a disabled or infirm spouse if you are claiming a disability amount transferred from your spouse on line 357 of your Schedule 2.

Also claim this reduction for each disabled or infirm dependent child born in 1982 or later that you claimed on line 32.

Claim $317 for each of these dependants.

Step 5 - Ontario investment and employee ownership (OIEO) tax credits

Line 39 - Labour-sponsored investment fund tax credit

You can claim this credit if you were an Ontario resident when you invested in a registered labour-sponsored investment fund.

You can claim a tax credit on your 2000 return for amounts invested in 2000 (that were not claimed on your 1999 return), or in the first 60 days of 2001. If the investment was made with funds from a spousal RRSP, the tax credit may be claimed by either the contributor to the RRSP trust or the beneficiary spouse.

The credit is 15% of the cost of the shares, up to a maximum of $750. The tax credit can be claimed on a deceased person's return. Calculate and enter your credit on line 39.

Attach to your paper return the OIEO(LSIF) tax credit certificate(s) Statement of Registered Labour-Sponsored Investment Fund Class A Shares issued by the labour-sponsored investment fund in which you invested. If you are using NETFILE, keep it in case we ask to see it.

You are also eligible for a federal tax credit. For details, see lines 413 and 414 in the General Income Tax and Benefit Guide.

Line 40 - Employee ownership tax credit

You can claim this credit if you were an employee who lived in Ontario when you invested in a registered employee ownership labour-sponsored venture capital corporation.

You can claim a tax credit on your 2000 return for amounts invested in 2000 (that were not claimed on your 1999 return), or in the first 60 days of 2001. Any unused balance can be carried forward.

The tax credit can be claimed on a deceased person's return.

Enter your credit, to a maximum of $4,150, on line 40.

Attach the OIEO(EO) tax credit certificate(s) Statement of Registered Employee Ownership Labour- Sponsored Venture Capital Corporation Class A Shares to your paper return. If you are using NETFILE, keep it in case we ask to see it.

Line 41 - Unused employee ownership tax credits from previous years

Your Notice of Assessment or Notice of Reassessment for 1999 shows your unused employee ownership tax credits from previous years. Enter this amount on line 41 of Form ON428.

Form ON479, Ontario Credits

Income for Ontario tax credits

Enter your net income on line 1 of Form ON479 and, if you had a spouse on December 31, 2000, enter your spouse's net income on line 2.

Did you have a spouse in 2000?

If you lived with your spouse on December 31, 2000, only one of you can claim the property, sales, and Ontario home ownership savings plan (OHOSP) tax credits for both of you. However, if one spouse is 65 or older, that spouse has to claim these credits for both of you.

If you and your spouse occupied separate principal residences for part or all of the year for medical, educational, or business reasons, we consider you to be "involuntarily separated" during that period for property, sales, and OHOSP tax credit purposes.

If you and your spouse were involuntarily separated on December 31, 2000, each of you can claim property, sales, and OHOSP tax credits. In this situation, do not enter your spouse's net income on line 2 but be sure to enter your spouse's address at box 6089 in that section of the form.

If you and your spouse were separated or divorced on December 31, 2000, each of you can claim Ontario tax credits. Do not enter your spouse's net income on line 2.

If your spouse died in 2000, you can claim the Ontario tax credits on your return. However, you cannot claim an additional sales tax credit for your deceased spouse. In this situation, do not enter your spouse's net income on line 2.

Deceased person

You cannot claim the Ontario property and sales tax credits or the Ontario Home Ownership Savings Plan (OHOSP) tax credit on the return of a person who died in 2000. However, you can claim the Ontario political contribution tax credit on a deceased person's return. If the deceased person was self-employed, you can claim the applicable Ontario tax credits for self-employed individuals.

Were you an international student in 2000?

If you are a student from another country (visa student) who attended an Ontario educational institution in 2000, contact the Canada Customs and Revenue Agency's International Tax Services Office at 1-800-267-5177 or (613) 952-3741 to find out your residency status. If it is determined that you were a resident of Ontario on December 31, 2000, for tax purposes, you may be eligible for Ontario tax credits.

Were you bankrupt in 2000?

If you were bankrupt in 2000, claim your Ontario tax credits on the post bankruptcy return you file for 2000. When you calculate "Income for Ontario tax credits" on line 3 of Form ON479, Ontario Credits, include your net income for the pre and post bankruptcy periods, and the net income of your spouse with whom you lived on December 31, 2000.

Your bankruptcy trustee may claim the Ontario tax credits for self-employed individuals if you were eligible for the credit(s) during the period when the trustee acted on your behalf. Your property tax credit claim is based on your occupancy cost for all of 2000. Your political contribution tax credit is based on contributions made during all of 2000.

Property tax credit

You can claim this credit if all of the following conditions apply:

• you were a resident of Ontario on December 31, 2000;
• rent or property tax on a principal residence (as defined below) was paid by or for you in 2000; and
• you were 16 or older on December 31, 2000.

You cannot claim this credit if you were under 19 on December 31, 2000, and you lived with someone who received a Canada Child Tax Benefit payment for you in 2000.

A principal residence is a housing unit in Ontario that you usually occupy during the year. It can be a house, apartment, condominium, hotel or motel room, mobile home, or rooming house. A principal residence does not include a residence exempt from municipal and school tax.

Occupancy cost (lines 4 to 7)

Your occupancy cost only covers the period in 2000 that you lived in your principal residence in Ontario.

If you were a homeowner, occupancy cost is the property tax paid in Ontario on your principal residence in 2000.

If you rented, occupancy cost is 20% of the rent paid in Ontario in 2000.

If you were a farmer, base your occupancy cost on the property tax, or on the rent paid, for your principal residence and one acre of land.

If you lived in a mobile or modular home that you owned, and it was situated on leased land, base your occupancy cost on either the property tax paid (the property tax for the home and lot), or on the rent paid (20% of the total of rent paid for the land and property tax paid for the home).

If you lived in a nursing home, hospital, charitable institution, group home, or a similar institution, and the institution paid full municipal and school taxes, your occupancy cost must not include any accommodation subsidy paid by a government agency.

Your occupancy cost cannot include amounts such as:

• payments to relatives or friends who are not reporting the payments as rental income on their returns;
• property tax or rent paid on part of a home you used for rental or business purposes; or
• property tax or rent paid on a second residence, such as a cottage, if you claimed property tax or rent on your principal residence for the same period.

If you and your spouse lived together on December 31, 2000, your occupancy cost is based on the total rent or property tax paid during the year, including amounts paid by each spouse during a period of separation.

If you and your spouse separated during the year and lived apart on December 31, 2000, your occupancy cost is based on your share of the rent or property tax for the part of the year before the separation, plus your own rent or property tax after the separation.

If you shared a principal residence with one or more persons (other than your spouse), your occupancy cost is based on your share of the rent or property tax you paid for the year.

Line 6 - College residence

If you lived in a designated Ontario university, college, or private school residence, you can claim only $25 as your occupancy cost for the part of the year you lived in such a residence.

To find out if your residence is designated, contact your residence administrator, or the Ontario Ministry of Finance at the address or numbers listed on the Information for Residents of Ontario page at the beginning of this booklet.

Receipts - Do not attach property tax or rent receipts to your return. However, keep them in case we ask to see them.

Sales tax credit

You can claim the sales tax credit if all of the following conditions apply:

• you were a resident of Ontario on December 31, 2000;
• you were 16 or older on December 31, 2000; and
• no one else claimed an Ontario sales tax credit for you.

You cannot claim this credit if either of the following conditions apply:

• you were under 19 on December 31, 2000, and you lived with someone who received Canada Child Tax Benefit payments for you in 2000; or
• you were confined to a prison or a similar institution on December 31, 2000, and you were there for a period of more than six months during 2000.

Line 11 - Basic sales tax credit

Claim $100 for yourself.

Line 12 - Additional credit for spouse

Claim $100 if you had a spouse on December 31, 2000.

If your spouse died in 2000, you cannot claim this credit for your deceased spouse. In this situation, do not enter your spouse's net income on line 2.

Line 13 - Number of dependent children born in 1982 or later

Enter at box 6099 the number of dependent children you have. See the definition of a dependent child on page 1.

Claim $50 for each dependent child.

Only one person can claim a sales tax credit for a dependent child.

Ontario political contribution tax credit

You can claim this credit if you were a resident of Ontario on December 31, 2000, and you contributed to a registered Ontario political party or constituency association, or to a candidate in an Ontario provincial election. Only claim contributions you made during 2000. You or your spouse can claim the credit, but a contribution cannot be divided between both of you if only one receipt was issued.

How to claim

Enter your total contributions on line 19 of Form ON479.

Determine the amount to enter on line 20 as follows:

• For contributions of $300 or less, complete Column 1 in the following chart.
• For contributions of more than $300 but not more than $1,000, complete Column 2 below.
• For contributions of more than $1,000 but not more than $2,275, complete Column 3 below.
• For contributions of more than $2,275, enter $1,000 on line 20 of Form ON479.

Receipts - Attach official receipts to your paper return. If you are using NETFILE, keep them in case we ask to see them.

Ontario home ownership savings plan (OHOSP) tax credit

As a planholder, you can claim this credit if all of the following conditions apply:

• you were a resident of Ontario on December 31, 2000;
• you were 18 or older on December 31, 2000;
• you made contributions to a plan in 2000; and
• your net income is less than $40,000.

If you have a spouse, or if you are claiming an equivalent-to-spouse amount, your combined net income has to be less than $80,000.

Your claim is based on contributions made during the first five calendar years of a plan, starting with the calendar year in which you opened your plan.

If you bought a home in 2000, you can claim a tax credit for contributions you made to your plan up to the date of the home purchase.

If you lived with your spouse on December 31, 2000, only one of you can claim the OHOSP tax credit for both of you based on contributions made to your and/or your spouse's plan.

You cannot claim this credit if you closed your plan without buying a home.

The table on page 7 provides the tax credit factor to use on line 25 to calculate your tax credit.

Receipts - Attach to your paper return the official T1C-OHOSP receipts for qualifying contributions, issued by the financial institution where you have your plan. If you are using NETFILE, keep them in case we ask to see them.

Ontario tax credits for self-employed individuals

The following tax credits apply only to self-employed individuals. Include the amount of credits claimed for 2000 as income on your 2000 return.

Receipts - Do not attach documents relating to these credits to your return. However, keep them in case we ask to see them.

Line 28 - Co-operative education tax credit

If you hired co-op students enrolled in an Ontario university or college, or students or apprentices enrolled in qualifying leading-edge technology programs in an educational institution in Ontario, you may be able to claim a tax credit from 10% to 15% of eligible expenditures (as defined below.)

Eligible expenditures are salaries, wages, and other remuneration you paid to a student in a qualifying work placement, or payments made to an eligible educational institution or a placement agency for a qualifying work placement. The student must work at a permanent establishment of the employer in Ontario.

Claiming the credit

Claim this credit in the tax year in which the qualifying work placement ended, to a maximum of $1,000 for each four months of employment, with a minimum employment of ten weeks.

The maximum employment period is as follows:

• 16 months for co-op internships, for qualifying leading-edge technology work placements other than apprenticeships, and for qualifying leading-edge technology apprenticeships whose employment started before May 5, 1999; and
• 24 months for qualifying leading-edge technology apprenticeships whose employment started after May 4, 1999.

If the total salaries and wages paid in the previous tax year was:

• $600,000 or greater, claim 10% of eligible expenditures for the qualifying employment;
• not greater than $400,000, claim 15% of eligible expenditures for the qualifying employment; or
• greater than $400,000 but less than $600,000, calculate your claim using the chart on page 6.

Enter your claim on line 28 of Form ON479. For more information, get Information Bulletin CETC, Co-operative Education Tax Credit, from the Ontario Ministry of Finance.

Line 29 - Graduate transitions tax credit

If you hired an eligible unemployed Ontario post-secondary graduate for a minimum of six months, you may be able to claim a tax credit from 10% to 15% of eligible expenditures (as defined below) for graduates hired.

Eligible expenditures are salaries, wages, and other remuneration you paid to the post-secondary graduate in the first 12 months to work at a permanent establishment in Ontario.

Claiming the credit

Claim the credit on your 2000 return if the qualifying employment ended in 2000 or the first 12-month placement period ended in 2000.

The maximum credit is $4,000 for each new graduate hired. If the total of salaries and wages paid in the previous tax year was:

• $600,000 or greater, claim 10% of eligible expenditures for the qualifying employment;
• not greater than $400,000, claim 15% of eligible expenditures for the qualifying employment; or
• greater than $400,000 but less than $600,000, calculate your claim using the chart on page 6.

Enter your claim on line 29 of Form ON479.

For more information, get Information Bulletin GTTC, Graduate Transitions Tax Credit, from the Ontario Ministry of Finance.

Line 30 - Workplace child care tax credit

If you created additional licensed child care facilities or improved existing facilities (and were not in the business of providing child care), you may be eligible to claim a credit of 5% of qualifying expenditures incurred in the year.

Qualifying expenditures are:

• capital costs of the construction of new on-site licensed child care facilities in Ontario, or capital renovations of existing child care facilities in Ontario;
• capital costs of the purchase of certain equipment fixed to the child care facility; or
• contributions made by a business to an unrelated entity that are used to fund the capital cost of new licensed child care facilities in Ontario, or capital renovations of existing child care facilities in Ontario.

Claiming the credit

Enter your qualifying expenditures at box 6332 and claim your credit on line 30 of Form ON479.

For more information, get Information Bulletin WCCTC-1, The Workplace Child Care Tax Credit for Unincorporated Businesses, from the Ontario Ministry of Finance.

Line 31 - Workplace accessibility tax credit

If you hired an eligible person with a disability, you may claim a credit of 15% of eligible expenditures incurred in Ontario in the year to accommodate that person.

Eligible expenditures are:

A) interview costs for the prospective employee, such as fees paid to a sign language interpreter or intervener who assists in the job interview; and

B) "qualifying expenditures" to a maximum of $50,000 per employee.

Qualifying expenditures include:

• during the three months before employment and during the first twelve months of employment: certain disability related modifications and equipment expenditures allowed as deductions under the federal Income Tax Act, and expenditures incurred for certain devices or equipment needed by the employee to work;
• during the first six months of employment: expenditures incurred to provide a job coach, a note taker, a sign language interpreter, or an intervener; and
• for up to twelve months after the start of employment: costs to train the employee or co-workers to use a device or equipment acquired for the impairment.

Use the following formula to calculate the credit for each employee: (interview costs + qualifying expenditures) × 15% = workplace accessibility tax credit.

Enter the eligible expenditures at box 6334, and claim your credit on line 31 of Form ON479.

For more information, get Information Bulletin WATC-1, The Workplace Accessibility Tax Credit for Unincorporated Businesses, from the Ontario Ministry of Finance.

Line 32 - Educational technology tax credit

If, after May 2, 2000, you gave donations or provided price discounts to provincially assisted Ontario colleges of applied arts and technology or universities to acquire new eligible teaching equipment or eligible learning technologies, you may claim a tax credit. The credit is 5% of the amount by which the normal price exceeds the actual price paid by the eligible educational institution for the eligible teaching equipment or learning technologies.

Eligible teaching equipment includes new specialized machinery, instruments, tools, computer software, and other classroom, laboratory, studio or shop instructional equipment integral to course delivery.

Eligible learning technologies includes new information and communications equipment, such as multi-media projectors and specialized computer software that enhances instructional delivery and interaction among students and between students and instructors.

Enter at box 6330 the amount of donations and/or price reductions or discounts and claim your credit on line 32.

For more information on this credit, contact the Ministry of Finance Information Centre at 1-800-263-7965.

[View Co-operative education or graduate transitions tax credits]

OHOSP tax credit factor table

To determine your tax credit factor, use the amount from line 21 of Form ON479, Ontario Credits.

[View OHOSP tax credit factor table]