Tax Benefits of Hiring a Nanny in Calgary, Alberta

Parents who employ nannies in order so that they can work, go to school or conduct research can usually deduct the cost of the nanny as a childcare expense for tax purposes.

For each child aged six and under, you can deduct $7,000 annually, and for each child between ages seven and 16, $4000 annually. For a child who is eligible for the disability tax credit, parents can deduct $10,000 regardless of the child’s age.

This is a ton of money in annual savings!

Just keep in mind that when you hire a nanny, you will be required to provide a Canada Pension Plan and Employment Insurance premiums, which means deducting those amounts from her pay, and then matching those contributions.

Find an online payroll table or calculator and do the math - many parents find that they still get huge savings by hiring a nanny! And if you find the bureaucratic paperwork a bit frightening, you can always hire an outside company to take care of it all for you!