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Can you claim HST paid to part-time nanny?

By Gord Ahier |

DBovingdon asked:

If we hire a live out nanny (part time - max 18 hours/week) (she would be an independent contractor) and she asks us to cover her HST, can we claim that when we file our taxes?

Gord Ahier answered:

Childcare costs are costs incurred for the care of a child of the taxpayer or the taxpayer's spouse. The costs must be incurred to allow the taxpayer to be employed, carry on a business or to further education. The child must be under 16 at any time during the year or if over 16, dependent as a result of a physical or mental infirmity.

Childcare costs are normally deductible by the spouse with the lower income. Childcare costs include the expense paid to an eligible person for the provision of childcare services. They also include the cost of day camp or sports school, boarding school or camp and payments to an educational institution for the purpose of providing child care. The payments must not be made to a parent of the child, a related person under 18 or a person in respect of whom a dependent deduction can be claimed.

Where the cost includes HST, the HST component would form part of the childcare costs. However, childcare services provided primarily to children aged 14 and under and for periods of less than 24 hours are exempt from HST/GST. In your situation, it appears that HST should not be paid if your child is under 15 years of age. In order to claim the costs, you need to ensure that you have a receipt that includes the name, address and social insurance number of the provider. It must also include the parents name, the amount paid, the date of payment and the providers signature.

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