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Author Topic: Your babysitter could be a tax writeoff  (Read 64465 times)

Offline CareDC

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Your babysitter could be a tax writeoff
« on: November 13, 2010, 09:49:45 AM »
It's date night. You've made dinner reservations, perhaps secured show tickets and, most important, booked the babysitter.

To ease the financial burden of your well-deserved night out, did you realize that you could be writing off the cost of that babysitter?

Depending on the ages of your brood, babysitting can qualify as a tax-deductible child-care expense, provided the sitter is not someone under 18 who is "related" to you.

Under the Income Tax Act, related is defined as someone who is connected to you by blood, marriage, common-law partnership or adoption. This includes siblings, but not nieces, nephews, aunts and uncles.

The Canada Revenue Agency says to make a valid claim for child-care expenses, you must be given a receipt showing the amount paid as well as the social insurance number of the child-care provider or sitter.

But is the lack of a receipt from the 14-year-old babysitting the kids fatal to a successful child-care deduction claim? That was essentially the case before the Tax Court earlier.

In 2007, Jason Allott claimed about $4,200 of deductible child-care expenses for amounts he claimed were paid to two teenagers who babysat his kids. He provided the court with evidence of the weekly payments he made to the two teenagers.

The first teenager provided a letter confirming the amount she received along with a separate letter with her SIN on it. While numerous attempts were made to get a receipt from the second teenager, that sitter's parents refused to provide any information.

While the CRA was prepared to allow the payments made to the first babysitter, it maintained that amounts paid to the second sitter were simply not deductible, since no receipt was provided.

The Tax Act governing child-care expenses says, "...the payment of which is proven by filing with the [CRA] one or more receipts each of which was issued by the payee and contains, where the payee is an individual, that individual's SIN."

Offline EngineerMom21

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Re: Your babysitter could be a tax writeoff
« Reply #1 on: March 10, 2011, 01:16:44 PM »
Interesting...I would have never thought to use the baby-sitter as a write-off.  I still think I would be too afraid to try it!  Don't need the tax man coming to knock on my door!

Offline susanbetts

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Re: Your babysitter could be a tax writeoff
« Reply #2 on: October 17, 2016, 01:54:38 PM »
Correct, babysitter's expense is deduct-able, my tax consultant told me this when I was in the process of Income Tax Preparation Richmond Hill, he asked me if I use services of a babysitter or not and I felt kinda weird that why he is asking such question but than he explained.


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