Do teenagers need to file a tax return if they work part-time?

Like many milestones, this one can be used as a “teachable moment” for kids and parents.

Q. I have three children, aged 14, 17 and 18. All have part-time jobs and make less than $3,000 per year, which they receive T4s for. They also all make charitable donations.

I have four quick questions for you: Do I need to file income taxes for them? Can I still claim them as dependents? Do I need to claim their income on my tax return? And can I claim their charitable donations?
–Brad

A. Before I answer your questions, I’d like to congratulate your children. I find that most teens are eager to work, and by doing so, they gain valuable skills that will serve them now and in their future careers.

While you do not need to file returns for them (in general, any Canadian who earns $12,298 or less per year doesn’t need to file), I always urge parents to get their children into the habit of filing an annual return as soon as possible, as it teaches them to be responsible citizens. (It also shows them early on that a tax return isn’t something to be afraid of!) And by filing a return, they will start to establish some Registered Retirement Savings Plan (RRSP) room for future contributions.

I also recommend that you file together as a family, as this will allow you to claim all the family credits you are eligible for—and so that, yes, you can claim you children’s charitable donations as a family on the return which will provide the best tax result. That means more possible savings for your family as a whole.

You will not be taxed on your children’s income as they are each filing individual T1 personal returns. You will be able to claim them as dependents as long as they are a minor (meaning they are not yet 18 years of age) or are still in school, college or university.

Finally, it’s important to note that once each child turns 18, you are no longer eligible to claim the HST credit for that child. Rather, each adult child can claim this credit themselves.