Provincial News:  NS Affordable Living Tax Credit

On July 1^st, 2010, the Province of Nova Scotia raised the Harmonized Sales Tax rate from 13% to 15%. Included in the 2010 provincial budget were measures to offset this increase for low-income taxpayers. The Nova Scotia Affordable Living Tax Credit is a refundable tax credit paid quarterly, and the Poverty Reduction Credit is a quarterly payment to those receiving Social Assistance through the Income Assistance Program.

The Province of Nova Scotia also made a very important commitment to low-income seniors in the 2010 budget. Anyone receiving the Guaranteed Income Supplement would no longer have to pay provincial income tax!

In Nova Scotia the basic personal amount is $8231 and the age amount is $4019 for a total of $12,250. When the low-income tax credit is factored in, a single senior in Nova Scotia will pay provincial tax when taxable income (line 260) exceeds approx. $13,955. Subtracting the maximum OAS payment for 2010 ($6222) from this amount results in an income of $7733 for GIS purposes (assuming that it is not employment income). The cut-off for GIS for single, widowed or divorced pensioners for the current quarter is $15,888, so there are lots of senior GIS recipients in Nova Scotia paying provincial tax.

This measure to eliminate provincial tax for GIS recipients is not currently administered by CRA. This means that, for the 2010 income tax filing, the province will rebate seniors the full amount of the net provincial tax paid. There is no application form as eligibility will be determined by information from the tax return. Rebate cheques will be mailed during the summer and fall of 2010, so Nova Scotia seniors are encouraged to file on time to avoid delay.

ADDITIONAL EDUCATIONAL RESOURCES: Advanced Tax Preparation and Research