Net income

Line 206 - Pension adjustment

Enter on line 206 the total of all amounts in box 52 of your T4 slips, or box 34 of your T4A slips. Generally, this total represents the value of the benefits you earned in 1999 under a registered pension plan (RPP) or a deferred profit-sharing plan (DPSP).

Do not include the pension adjustment (PA) amount in your income, and do not deduct it on your return. Simply enter this amount on line 206. We will use it to calculate your registered retirement savings plan (RRSP) deduction limit for 2000, which we will show on your Notice of Assessment for 1999. See line 208 for details.

If you have any questions about how your PA was calculated, ask your employer.

Note
If you were a deemed resident in 1999 and you participated in a foreign pension plan in 1999, you may have to enter an amount on this line. For details, contact the International Tax Services Office.

Line 207 - Registered pension plan (RPP) deduction

Enter the total of all deductible amounts shown in box 20 of your T4 slips, in box 32 of your T4A slips, or on your union or RPP receipts.

You can deduct the total amount unless it is more than $3,500 and your information slip shows a past-service amount for service before 1990. In that case, or if you contributed to an RPP in a previous year and could not deduct part of the amount, contact the International Tax Services Office to find out how much you can deduct.

Receipts - With the exception of your T4 and T4A slips, do not include your receipts with your return. However, you have to keep them in case we ask to see them.

Note
You cannot deduct contributions you made to pension plans in other countries, with two exceptions. Under the Canada-France Income Tax Convention and the Canada-Netherlands Income Tax Convention, you may be able to deduct contributions to a pension plan. If you have contributed to a pension plan in either France or the Netherlands, contact the International Tax Services Office to find out if you can deduct the amount.

Line 208 - Registered retirement savings plan (RRSP) deduction

This section gives general information on RRSPs. If you need more information after reading this section, get the guide called RRSPs and Other Registered Plans for Retirement. For information about Schedule 7, see the section about this schedule on page 27.

Receipts - Attach to your return official receipts for all amounts you contributed from March 2, 1999, to February 29, 2000, including those you are not deducting on your 1999 return and those you are designating as Home Buyers' Plan (HBP) or Lifelong Learning Plan (LLP) repayments. See "Line 6 - Repayments under the HBP and LLP" on page 28 for details about HBP and LLP repayments. If you contributed to your spouse's plan, the receipt has to show your name as the contributor and your spouse's name as the annuitant. Also attach Schedule 7 if you have to complete it.

Maximum contributions you can deduct

The maximum you can deduct on line 208 is whichever of the following amounts is less:

• the undeducted RRSP contributions shown on your 1998 Notice of Assessment or Notice of Reassessment plus the total of your RRSP contributions made from March 2, 1999, to February 29, 2000 (not including amounts you designate as HBP or LLP repayments, see "Line 6 - Repayments under the HBP and LLP" on page 28); or
• your 1999 RRSP deduction limit (see "Line 8 - Deduction for contributions based on your 1999 RRSP deduction limit" on page 29) plus amounts you transfer (see "Line 9 - Transfers" on page 29) to your RRSP on or before February 29, 2000.

Notes
Neither you nor your spouse can contribute to your RRSP after the end of the year you turn 69. Therefore, you may no longer be able to contribute to your own RRSP, even though you still have an RRSP deduction limit that you have not used. If so, you still can contribute to an RRSP for your spouse until the end of the year he or she turns 69. You can deduct these contributions as long as your deduction limit allows. If you contribute more to an RRSP than you can deduct, you may have to pay a special tax.

Schedul e 7

You may not have to complete Schedule 7. To find out, read the information at the top of the schedule. If you do have to complete it, you will find information below about lines 1, 2, 3, 6, 8, and 9.

Line 1 - Undeducted RRSP contributions

This is the total of all contributions to your own RRSP or to an RRSP for your spouse that you made after 1990 and showed on a previous year's Schedule 7, but did not deduct on any previous return. This amount is shown on your 1998 Notice of Assessment or Notice of Reassessment.

If you do not have your 1998 Notice of Assessment or Notice of Reassessment, you can find out if you have undeducted RRSP contributions for 1998 by calling the International Tax Services Office.

Note
If you made RRSP contributions from March 3, 1998, to March 1, 1999, that you did not deduct on your 1998 return, you should have filed a completed Schedule 7 with your 1998 return. If you did not, you should submit your receipts and a completed copy of a 1998 Schedule 7 to the International Tax Services Office, but not with your 1999 return. See "How do you change a return?" on page 12 for details. However, if you made a contribution from January 1, 1991, to March 2, 1998, and you did not show it on a Schedule 7 for 1997 or earlier, contact the International Tax Services Office.

Lines 2 and 3 - Total RRSP contributions

This total includes amounts you:

• contributed to your own RRSP or an RRSP for your spouse from March 2, 1999, to February 29, 2000;
• transferred to your own RRSP (see "Line 9 - Transfers" on page 29); and
• designate as Home Buyers' Plan (HBP) or Lifelong Learning Plan (LLP) repayments (see "Line 6 - Repayments under the HBP and LLP" on this page).

Be sure to include on these lines any contributions you made from January 1, 2000, to February 29, 2000, even if you are not deducting them on your 1999 return. Otherwise, we may reduce or disallow the claim for these contributions you make on your return for a future year.

Do not include the following amounts:

• Any unused RRSP contributions you made on or after March 2, 1999, that were refunded to you or your spouse in 1999. Report the refund on line 129 of your 1999 return. If you have Form T3012A, Tax Deduction Waiver on the Refund of Your Undeducted RRSP Contributions, that we have approved for that amount, attach it to your return and claim a deduction on line 232. Otherwise, attach a completed Form T746, Calculating Your Deduction for Refund of Undeducted RRSP Contributions, to find out if you can claim this deduction.
• Part or all of the contributions you made to your RRSP or an RRSP for your spouse less than 90 days before you or your spouse withdrew funds from that RRSP under the HBP or LLP. For more details, get the guide called Home Buyers' Plan (HBP) or the guide called Lifelong Learning Plan (LLP).
• Any payments directly transferred to your own RRSP for which you did not receive an information slip.
• The part of an RRSP withdrawal that you recontributed to your RRSP and deducted on line 232. This would have happened if, in error, you withdrew more RRSP funds than necessary to obtain past-service benefits under a registered pension plan (RPP).
• If you received a T10 slip showing that you had a pension adjustment reversal for 1998, any RRSP contributions you made from March 2, 1999, to April 30, 1999, that you claimed on your 1998 return. This can happen, for example, when you leave an RPP.
• The excess part of a direct transfer of a lump-sum payment from your RPP to an RRSP or registered retirement income fund (RRIF) that you withdrew and are including on line 129 or 130 of your 1999 return, and deducting on line 232. You can complete Form T1043, Deduction for Excess Registered Pension Plan Transfers You Withdrew From Your RRSP or RRIF, to calculate the deductible amount.

Line 6 - Repayments under the HBP and LLP

If you have withdrawn funds from your RRSP under the Home Buyers' Plan (HBP) you may have received a Home Buyers' Plan (HBP) - Statement of Account from us, indicating the amount of the annual repayment you have to make for 1999. If you withdrew funds from your RRSP in 1999 under the Lifelong Learning Plan (LLP) you can make a repayment for 1999 if you want, but you do not have to.

You make repayments by contributing to your own RRSP from January 1, 1999, to February 29, 2000, and designating them using line 246 or 262 of Schedule 7. Do not make repayments to us.

Enter on line 6 the amount from line 15, which is the total of the RRSP contributions you are designating as 1999 repayments under the HBP or LLP. Do this only if you did not deduct them or designate them as repayments on your 1998 return, and they were not refunded to you. You cannot deduct any RRSP contribution you designate as an HBP or LLP repayment on Schedule 7.

Note
If you do not repay the amount indicated on your HBP statement of account on or before February 29, 2000 (and designate it on your Schedule 7 for 1999) you have to include an amount in income. See line 129 for details.

Remember to complete the "1999 withdrawals under the LLP" section of Schedule 7. In that section, you have to state the total of your withdrawals for the year from box 25 of your T4RSP slip, and you can check the box at line 264 to designate that your spouse was the student for whom the funds were withdrawn. If you do not check the box, you will be considered to be the student for LLP purposes. You can change the person you designate as the student only on the return for the year you make your first withdrawal.

The guides called Home Buyers' Plan (HBP) and Lifelong Learning Plan (LLP) include more information about:

• when you have to make your repayments; and
• the rules that apply when the person who made the withdrawal dies, turns 69, or becomes a non-resident.

Non-residents and non-residents electing under section 217 - If you ceased to be a resident of Canada after you bought or built a qualifying home with funds you withdrew under the Home Buyers' Plan, you should have repaid the amount to us by now. If not, you should contact the International Tax Services Office.

Line 8 - Deduction for contributions based on your 1999 RRSP deduction limit

We will show your 1999 RRSP deduction limit on your latest Notice of Assessment or Notice of Reassessment for 1998, or on Form T1028, Your RRSP Deduction Limit Statement for 1999. You can carry forward indefinitely any part of your RRSP deduction limit accumulated after 1990 that you do not use.

If you do not have your notice or Form T1028, you can find out your limit for 1999 by contacting the International Tax Services Office. You will find the address and telephone numbers on the back cover of this guide.

If you would like to calculate your 1999 RRSP deduction limit, get the guide called RRSPs and Other Registered Plans for Retirement.

Note
In a previous year, you may have received income for which you could contribute to an RRSP, but you may not have filed a return for that year. If you want to keep your RRSP deduction limit up to date, you have to file a return for that year.

Line 9 - Transfers

You may have received certain types of income and reported them on line 115, 129, or 130 of your 1999 return. If you contributed any of these amounts to your own RRSP on or before February 29, 2000, you can deduct this contribution, called a transfer, in addition to any RRSP contribution you make based on your "1999 RRSP deduction limit."

For example, if you received a retiring allowance in 1999, you would report it on line 130 of your return. You can contribute to your RRSP up to the eligible part of that income (box 26 of your T4A slip) and deduct it as a transfer. Include the amounts you are transferring on lines 240 and 245 of Schedule 7.

The guide called RRSPs and Other Registered Plans for Retirement has more information about amounts you can transfer.

Non-residents and non-residents electing under section 217 - You can transfer certain Canadian-source amounts otherwise subject to withholding tax, to a registered retirement savings plan (RRSP), a registered pension plan (RPP), or a registered retirement income fund (RRIF) without having tax withheld. These amounts include payments out of an RPP, deferred profit-sharing plan, a RRIF, an RRSP, or a retiring allowance. The transfers have to be direct transfers, and you have to complete Form NRTA1, Authorization for Non-Resident Tax Exemption. For more information, contact the International Tax Services Office.

Line 209 - Saskatchewan Pension Plan deduction

You may be able to deduct 1999 contributions to the Saskatchewan Pension Plan (SPP). You can deduct whichever of the following three amounts is least:

• $600;
• your 1999 RRSP deduction limit minus your RRSP deduction from line 208 (not including transfers to your RRSP); or

• the total amount you contributed to the SPP for yourself or your spouse from January 1, 1999, to February 29, 2000, not including any contributions that you deducted on your 1998 return.

Note
For 1998, you also could have deducted contributions you made for your spouse. This change was made public after the 1998 guide went to print. If it affects how you would have filed your 1998 return, you can ask us to correct it. See "How do you change a return?" on page 12 for details.

Receipts - Attach your receipts to your return.

Line 212 - Annual union, professional, or like dues

Enter the total of the following amounts:

• annual membership dues you paid to a trade union or an association of public servants;
• dues you paid to a professions board that you had to pay under provincial law;
• professional or malpractice liability insurance premiums or professional membership dues you paid if you had to pay them to keep a professional status recognized by law; and
• dues you paid to a parity or advisory committee (or similar body) that you had to pay under provincial law.

Annual membership dues do not include initiation fees, special assessments, or charges for anything other than the organization's ordinary operating costs. You cannot claim charges for pension plans as membership dues even if your receipts show them as dues. For more information, get Interpretation Bulletins IT-103, Dues Paid to a Union or to a Parity or Advisory Committee, and IT-158, Employees' Professional Membership Dues.

The amount shown in box 44 of your T4 slip, or on your receipts, includes any goods and services tax/harmonized sales tax (GST/HST) you paid.

Tax Tip
You may be eligible for a rebate of any GST/HST you paid as part of your dues. See line 457 for details.

Receipts - With the exception of your T4 slips, do not include your receipts with your return. However, keep them in case we ask to see them.

Line 214 - Child care expenses

Generally, you can claim expenses you or your spouse paid for someone to look after your child, so you (or your spouse) could earn income, go to school, or conduct research in 1999. The child must, at some time in 1999, have either been under 16 or had a mental or physical infirmity.

For more information, and to make your claim, get Form T778, Child Care Expenses Deduction for 1999. However, if you claimed child care expenses on your 1998 return, the package we mailed to you should include this form.

Tax Tips
You may be able to claim payments you made to a boarding school, sports school, or camp. For details, get Form T778.

If your child needs special attendant care or care in an establishment, see "Options" in the guide called Information Concerning People with Disabilities for details about different amounts you may be able to claim.

Receipts - Attach a completed Form T778, but not your receipts, to your return. Keep your receipts in case we ask to see them.

Non-residents and non-residents electing under section 217 - You can only deduct child care expenses if you meet the criteria outlined on Form T778 and the expenses were paid to a resident of Canada for services provided in Canada.

Line 215 - Attendant care expenses

If you can claim the disability amount (line 316) you can claim expenses you paid for personal attendant care that allowed you to earn certain income. This includes income from employment or self-employment and a grant you received for conducting research. To calculate your claim, complete Form T929, Attendant Care Expenses.

Tax tip
"Options" in the guide called Information Concerning People with Disabilities has details about different amounts you may be able to claim.

For more information, get the guide called Information Concerning People with Disabilities.

Receipts - Do not include your receipts or Form T929 with your return. However, keep them in case we ask to see them.

Line 217 - Business investment loss

A business investment loss is a special type of capital loss. For instance, such a loss can occur when you dispose of shares or certain debts of a small business corporation. For more information, and to find out how to complete lines 217 and 228 (to the left of line 217) get the guide called Capital Gains.

If you have a tax shelter, see "Tax shelters" on page 17.

Non-residents and non-residents electing under section 217 - A business investment loss applies to you only if the loss arises from property that would have been taxable to you in Canada.

Line 219 - Moving expenses

Deemed residents - Generally, if you moved at least 40 kilometres in 1999 to start a job or a business, or to study full-time at an educational institution that offers post-secondary courses, you can deduct your moving expenses from income you earned at the new location. For more information, get Form T1-M, Moving Expenses Deduction.

Non-residents - You can only deduct moving expenses if you were a full-time student during 1999. If this is your situation, contact the International Tax Services Office for the special rules that apply to you

How to claim

Complete Form T1-M to find out what you can deduct.

Note
If you moved in 1998 but could not claim all your moving expenses in that year, you can claim the remaining expenses against income you earned in 1999 at the new location.

Receipts - Do not include your receipts or Form T1-M with your return. However, keep them in case we ask to see them.

Line 220 - Support payments made

Enter on line 230 the total spousal and child support you paid in 1999. Enter on line 220 the deductible amount. If your order or agreement has been amended, or you need more information, get the pamphlet called Support Payments.

Receipts - Do not include your receipts or cancelled cheques, or your court order or written agreement with your return. However, keep them in case we ask to see them.

Line 221 - Carrying charges and interest expenses

You can claim the following carrying charges and interest you paid to earn income from investments:

• fees to manage or take care of your investments (other than administration fees you paid for your registered retirement savings plan or registered retirement income fund) including safety deposit box charges;
• fees for certain investment advice (see Interpretation Bulletin IT-238, Fees Paid to Investment Counsel) or for recording investment income;
• fees to have someone complete your return, but only if you have income from a business or property, accounting is a usual part of the operations of your business or property, and you did not use the amounts claimed to reduce the business or property income you reported (see Interpretation Bulletin IT-99, Legal and Accounting Fees); and
• most interest you pay on money you borrow, but generally only as long as you are using it to try to earn investment income, including interest and dividends. However, if the only earnings your investment can produce are capital gains, you cannot claim the interest you paid. For details, contact the International Tax Services Office.

You cannot deduct on line 221 any brokerage fees or commissions you paid when you bought or sold securities. Instead, you use these costs when you calculate your capital gain or capital loss. For more information, get the guide called Capital Gains. You also cannot deduct the interest portion of student loan repayments. However, you may be able to claim a credit on line 319 for this amount.

Note
You cannot deduct the interest you paid on money you borrowed to contribute to a registered retirement savings plan or a registered education savings plan.

Canada Savings Bonds (CSBs) - When you buy bonds through payroll deductions, you may pay an interest charge. You can claim this amount on line 221.

Example
Michael bought a $1,000 CSB through payroll deductions. The total amount deducted from his pay for the bond was $1,017.94 (the $1,000 face value of the bond plus $17.94 he paid in interest). Michael can claim the $17.94 on line 221.

Policy loan interest - To claim interest you paid during 1999 on a policy loan made to earn income, have your insurer complete Form T2210, Verification of Policy Loan Interest by the Insurer, on or before April 30, 2000.

Refund interest - If we paid you interest on an income tax refund, you have to report the interest in the year you receive it, as explained at line 121 in this guide. If we then reassessed your return and you repaid some of the refund interest in 1999, you can deduct the amount you repaid.

Carrying charges for foreign income - If you have carrying charges for Canadian and foreign investment income, identify them separately on Schedule 4, according to the percentage that applies to each investment.

Receipts - To make your claim, complete Part IV of Schedule 4. Do not include your receipts or Form T2210 with your return. However, keep them in case we ask to see them.

If you have a tax shelter, see "Tax shelters" on page 17.

Line 224 - Exploration and development expenses

If you invested in a petroleum, natural gas, or mining venture in 1999, but did not participate actively, you can deduct your expenses on this line. If you participated actively, follow the instructions at line 135.

How to claim

• Complete Part V of Schedule 4 using the information that the principals of the venture give you.
• Attach to your return either a T5 or T5013 slip, or a statement that gives details of the deduction.

The statement has to identify you as a participant in the venture, show your allocation (the number of units you own, the percentage assigned to you, or the ratio of your units to those of the whole partnership), and give the name and address of the fund.

If you have a tax shelter, see "Tax shelters" on page 17.

Renounced resource expenses - If you received a T101, T102, or T5013 slip, use the instructions on the back to calculate your deduction. Attach to your return your slip and a note showing how you calculated your deduction.

Depletion allowances - Claim these amounts on line 232.

If you have any questions about these expenses, contact the International Tax Services Office. You will find the address and telephone numbers on the back cover of this guide.

Line 229 - Other employment expenses

You can deduct certain expenses (including any goods and services tax/harmonized sales tax (GST/HST)) you paid to earn employment income. You can claim the expenses only if your employment contract required you to pay them, and either you did not receive an allowance for the expenses, or the allowance you received is included in your income.

Note
Most employees cannot claim employment expenses. You cannot deduct the cost of travel to and from work, or other expenses, such as clothes and tools.

Complete and attach Form T777, Statement of Employment Expenses, to give us details of your expenses and to calculate how much you can deduct. The guide called Employment Expenses contains Form T777 and other forms you may need. The guide also explains the limits and conditions that apply when you claim these expenses.

Repayment of salary or wages - You can deduct salary or wages you included in income for 1999 or a previous year, if you repaid them in 1999. This includes amounts you repaid for a period when you were entitled to receive wage-loss replacement benefits. However, you cannot deduct more than the income you received when you did not perform the duties of your employment.

Legal fees - You can deduct legal fees you paid to collect or establish a right to salary or wages. However, you have to reduce your claim by any amount awarded to you, or any reimbursement you received for your legal expenses.

Receipts - Do not include your receipts or forms with your return, except for Form T777. However, keep them in case we ask to see them.

Tax Tip
You may be eligible for a rebate of any GST/HST you paid as part of your expenses. See line 457 for details.

Line 231 - Cleric's residence deduction

Use this line to claim a deduction for your residence if you are a cleric. See Interpretation Bulletin IT-141, Clergymen's Residences, to see how much you can claim, if any.

Line 232 - Other deductions

Use this line to claim allowable amounts not deducted anywhere else on this return. In the space to the left of line 232, identify the deduction you are claiming. If you have more than one amount, or you want to explain your deduction more fully, attach a note to your return.

If you have a tax shelter, see "Tax shelters" on page 17.

Income amounts paid back

In 1999, you may have paid back amounts (such as Old Age Security benefits) that you included in income for 1999 or a previous year. If so, you may be able to deduct them on your 1999 return. Attach to your return receipts or other documents showing the amounts you paid back. However, if you paid back employment income, see "Repayment of salary or wages" under line 229. If you paid back income tax refund interest, see "Refund interest" under line 221.

EI benefits - You may have received more benefits than you should have, and already paid them back to Human Resources Development Canada (HRDC). For example:

• HRDC may have reduced your EI benefits after discovering the mistake. In this case, your T4E slip will show only the net amount you received, so you cannot claim a deduction.
• You may have repaid HRDC. If so, box 30 of your T4E slip will show the amount you paid back. Include this amount on line 232. This is not the same as repaying a social benefit as explained at line 235.

Legal fees

You can deduct any of the following:

• fees you paid for advice or assistance in objecting to or appealing an assessment or decision under the Income Tax Act, the Unemployment Insurance Act, the Employment Insurance Act, the Canada Pension Plan, or the Quebec Pension Plan, plus any related accounting fees (although you have to reduce your claim by any award or reimbursements you received for such expenses);
• fees you incurred to collect late support payments that you will include in your income or non-taxable child support payments, or that you incurred to defend your right to such payments;
• fees you incurred to get a court order when suing your spouse or former spouse, or the natural parent of your child, for maintenance payments (including non-taxable child support payments) in a Family Court; and
• fees you paid to collect (or establish a right to) a retiring allowance or pension benefit. However, you can only claim up to the amount of retiring allowance or pension income you received in the year, minus any part of these amounts transferred to a registered retirement savings plan or registered pension plan. You also have to reduce your claim by any award or reimbursement you got for these expenses. You can carry forward for up to seven years legal fees that you cannot claim in the year.

You cannot claim legal costs to obtain a separation or divorce, to establish or revise a right to support payments, or to establish custody of a child. For details of other legal fees you may be able to deduct, get Interpretation Bulletin IT-99, Legal and Accounting Fees.

For details about these amounts, contact the International Tax Services Office.

Line 235 - Social benefits repayment

Employment Insurance (EI) benefits

You may have to repay part of the EI benefits (line 119) you received in 1999 if one of the following applies:

• There is an amount in box 15 of your T4E slip, the repayment rate in box 7 is 30%, and your net income before adjustments (line 234) is more than $48,750.
• There is an amount in box 16 of your T4E slip, and your net income before adjustments (line 234) is more than $48,750.
• There is an amount in box 15 of your T4E slip, the repayment rate in box 7 is more than 30%, and your net income before adjustments (line 234) is more than $39,000.

Complete one or both of the charts included with your T4E slip to calculate how much of your EI benefits you have to repay.

If you were a deemed resident in 1999 and you also have to repay Old Age Security (OAS) benefits you received (see the next section) enter, on lines 7 and 13 of the chart for line 235 on the Worksheet (included in the centre of this guide), the EI benefits that you have to repay.

Old Age Security (OAS) benefits

If you received OAS pension (line 113) or net federal supplements (line 146) and your net income before adjustments (line 234) is more than $53,215, you may have to repay all or a part of these benefits. Complete the chart for line 235 on the Worksheet (included in the centre of this guide) to calculate how much you have to repay.

Non-residents and non-residents electing under section 217 - If you received OAS pension or net federal supplements in 1999 and you are required to file an Old Age Security Return of Income, do not complete the chart for line 235 on the Worksheet. Instead, enter on line 235 the amount from line 235 of your Old Age Security Return of Income.

Notes
Recovery tax may have been withheld from your monthly OAS pension if you had an OAS repayment for 1998. The amount deducted is included in box 22 of your 1999 T4A(OAS) slip. If you were a deemed resident in 1999, claim it on line 437 to reduce the amount of tax you owe when you file your 1999 return. Similarly, if you have an OAS repayment for 1999, tax may be withheld starting with your July 2000 OAS payment.

If you were a non-resident in 1999 or if you are electing under section 217, do not claim on line 437 of this return any recovery tax deducted from your OAS benefits. Instead, you should claim it on your Old Age Security Return of Income.