How do I transfer child care expenses to the spous...

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How do I transfer child care expenses to the spouse or common-law partner with the higher net income?

The CRA normally requires childcare expenses to be claimed by the spouse or common-law partner with the lower net income. However, the spouse or common-law partner with the higher net income may claim the expenses if one or more of the following conditions is met during the tax year:

  • The supporting person with the lower net income attended school part-time or full-time;
  • The supporting person with the lower net income was incapable of caring for children because of a mental or physical infirmity;
  • The supporting person with the lower net income was in prison for at least two weeks;
  • You were separated from your spouse or common-law partner for at least 90 days due to a breakdown in your relationship.

To claim childcare expenses on the return of the spouse with the higher net income:

EasyStep interview:

If you’re preparing your returns together, enter your spouse’s information in the Introduction and Profile  sections of the interview. If you’re preparing your returns separately, enter your spouse’s information in the Introduction section of the interview, at [Name], info about your spouse or partner.

  1. Select Dependants under the Introduction menu on the left-hand side of the screen, and follow the prompts.
  2. Select Yes at “Did you pay for someone to look after your child so you could earn income, go to school, or conduct research?”, then click Continue.
  3. Open the Deductions & Credits section of the interview and select Child care profile.
  • If you’re preparing your returns together, select whether the spouse with the higher net income is eligible to claim the childcare expenses.
  • If you’re preparing separate returns, select whether you are the spouse with the higher net income, then follow the prompts on the screen.

 

Forms method:

  1. If you’re preparing your returns together, at the bottom of your screen, select the Forms or T-Slips button next to your spouse’s name. Then, select your spouse’s income form or slip (for example, T4) and enter their income information. If you’re preparing separate returns, enter your spouse’s income information on your T1 General, at Information about your spouse or common-law partner.
  2. Each spouse must complete and file a form T778.
  • If you’re preparing your returns together, at the bottom of your screen, select the Forms button next to your name. Then, select Form Lookup. Type “t778” into the search field and select T778 from the options that appear. Enter your information. Repeat this step for your spouse.
  • If you’re preparing your returns separately, open the Forms menu at the top of your screen and type “t778” into the search field. Select T778 from the options that appear. Enter your information into the form, as required. If you’re the higher income spouse, complete Part C.

Note: The spouse with the higher net income must complete part C. If any exceptions applied, the childcare expenses will be claimed on the return of the spouse with the higher net income.

If you’re preparing your returns together, enter your spouse’s information in the Introduction/Profile section of the interview. If you’re preparing your returns separately, enter your spouse’s  information in the Introduction section of the interview, at [Name], info about your spouse or partner.

  1. Under Dependants information in the Introduction section of the interview, answer Yes to the question "Do you have children or financially support another person?", enter your dependants, then click Continue.
  2. Select Yes at "Did you pay for someone to look after your child so you could earn income, go to school, or conduct research in 2020?", then click Continue.
  3. Open the Deductions menu on the left-hand side of the screen and select Child Care Expenses>Child Care Expenses Intro. Then, select Yes at “Did you pay for child care? and click Continue.
  • If you’re preparing your returns together, select whether the spouse with the higher net income is eligible to claim childcare expenses. Then,  select the spouse with the higher net income.
  • If you’re preparing separate returns, select whether you have the higher net income, then follow the prompts on the screen to enter the rest of the information.

Related information:

Where do I enter child care expenses in TurboTax?

How much can I claim for child care expenses?

What is the child care expenses deduction?

 

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