Reply #33: Canadian tax deductions.....

[murphyj87]

Generally speaking, any taxes paid in foreign nations are deductable on your T-1 Shedule 1 (T-1 is like your 1040)

Everyone filing a Canadian tax return has a personal deduction from total income, which for the 2010 tax year was $10,382 and if you have a spouse or partner, that deduction is an additional $10,382 minus a percentage of their income. If you do not have a spouse or partner, but have a child under 18, that child is deducted as a spouse would be (equivalent to married deduction), any child other than an "equivalent to married" child is a $2101 deduction.

You might also be eligible for the pension income deduction of $2000.

If you were born in or before 1945 (for the 2010 tax year) you have an additional age deduction of $6447.

Any additional medical expenses you or your family might have not covered by the health care system (vision care, dental care, perhaps some prescription drugs - depending on which province) the deduction is the total of the medical expenses minus 3% of your net income. If you have total income of say $50,000, the average net income for a senior with that income would be about $30,000, so, any supplimental medical expenses (vision, dental, etc.) over $900 (3% of the $30,000 net income) is tax deductable.

Canada Revenue Agency (like your IRS)