Understanding the Purpose of TD1 Form

Guide to Completing the Federal TD1 Form

It's common for your staff to have inquires regarding the completion of TD1 form, so it's important to stay informed on the process. The federal and provincial forms have specific instructions that must be followed attentively. Individual provinces may have their own variations, but we've outlined the Federal form for you below.

Note that the TD1-WS worksheet is included with the TD1 form but is not part of it. The TD1-WS supplies detailed information about your financial situation, which the government uses to compute your taxes. You'll be prompted to fill out the worksheet as you progress through the TD1 form.

The federal form entails several steps. At the start, on the first page, fill out the following details:

• • First & last name
• • Date of birth
• • Address
• • Social insurance number
• The form also includes several key boxes, which can be challenging for some people. Let's break them down one by one:
• Box 1 represents the Basic Personal Amount, which is a non-refundable tax credit that exempts you from paying taxes on your first $15,000 of earnings in the year.

Box 2 denotes the Canadian Caregiver Amount and applies to minors under 18 years of age with disabilities. This section decreases the amount of income tax you're required to pay. The claimable amount for each eligible child under 18 with disabilities is $2,499.

Box 3 represents the Age Amount. If you're 65 or older by December 1st, 2023, and your income is at or under $42,335, you can claim ,396. However, the deduction diminishes as your income rises. If your earnings fall between $42,335 and ,309, you'll need to fill out a worksheet to calculate the prorated amount you can claim.

Box 4 signifies the Pension Income Amount. The pension amount is a flat $2,000 applied to all pension incomes (excluding federal programs). If you earn at least $2,000 in pension income, you can claim the same amount on this box. If your pension income is under $2,000, you should only enter the actual income earned.

Box 5 applies to Tuition and pertains to full-time or part-time students enrolled in post-secondary education. You can claim the amount paid for tuition throughout the year if it exceeds $100.

Box 6 denotes the Disability Amount. If you've received a disability tax credit, you're eligible for ,428 in disability credit. If you possess a disability but haven't applied for the credit, then you shouldn't fill in this box.

Box 7 requires the details of your Spouse or Common Law Partner. To be eligible to claim, you must be residing with your supporting spouse, and their net income mustn't exceed $15,000 annually. Enter the difference between the projected income of your spouse and the amount in line 1. If your partner has a disability, you may add $2,499 to the claim amount.

Box 8 represents the Amount for an Eligible Dependant. If you don't have a spouse or common-law partner, but you're supporting a child who is dependent on you, you can subtract their income from $15,000 and enter the difference in this box.

Box 9 applies to the Canadian Caregiver Amount, which is relevant for spouses with disabilities, without a spouse but have eligible dependants under 18 with disabilities. You'll need to fill out the worksheet to claim this amount.

It's essential to ensure that all sections of the form are filled in correctly to prevent any discrepancies or penalties from the CRA.