Families were considered urban if they resided in a census metropolitan area CMA or a census agglomeration CA ; families were considered rural if they resided in any type of metropolitan influenced zone MIZ. Four summary variables were created to determine the distribution of children in the household among families with at least one child under 12 : 1 the total number of children in the household one child, two children, three or more children , 2 the total number of children in the household under 12 one child, two children, three or more children , 3 whether or not there was a child in the household under the age of 6 Yes, No , and 4 whether there was an additional child in the household aged 12—18 that could potentially provide child care for a younger sibling s Yes, No.
Work variables of interest were available separately for both the GSS respondent and their spouse if married or common law.
Variables included employment status worked, did not work , hours worked less than 30 h a week, 30—45 h a week, more than 45 h a week , and whether the hours of employment were standard a regular day shift or non-standard a regular evening shift, a regular night shift, a rotating shift, a split shift, on call, irregular schedule, or other. Variables were combined for respondents and spouses to create family-level variables that accounted for the employment characteristics of lone parents and both parents in the household.
Family work variables considered were family employment status lone or both parents work or in school, at least one parent not working or in school , family work hours lone or both parents work more than 30 h, other parent works less or more than 30 h, at least one parent non-working , and family standard employment lone or both parents work standard jobs, both parents work but one or both parents work non-standard jobs, at least one parent non-working. Non-working lone parents were included in the at least one parent non-working category.
Variables with non-significant differences between claimant and non-claimant families, indicated by Chi-square estimates with a p value greater than 0. Due to high correlations among family work variables, only the variable family work hours was included in the final analytic model.
Descriptive analyses were conducted to provide the distribution of demographic, child composition, and work characteristics among the overall analytic sample of families with at least one child under the age of Subsequent descriptive statistics calculated the frequencies separately for families that claimed the child care expense deduction and families that did not claim the child care expense deduction.
Chi-square tests were used to estimate overall significant differences in the distribution of demographic, child composition, and work characteristics between families that claimed the child care expense deduction and families that did not claim the child care expense deduction.
Finally, logistic regression analyses were conducted to estimate factors associated with a higher likelihood of claiming the child care expense deduction. A series of stepwise models were estimated to examine the relative contribution of additional variables in the model Model 1 includes the demographic variables only, Model 2 adds child composition, and Model 3 adds the work characteristic variables.
Bootstrap weights were utilized to account for the complex survey design. Exploratory analyses were conducted for families with at least one child under the age of 6 see Appendices. However, since the T1FF is a family file, analyses were conducted at the level of the family and not the child. The T1FF provides information on whether or not a family claimed the child care expense deduction, but information is not provided on the specific child or children for whom the deduction was claimed.
Therefore, it is not possible to disentangle the age of the child for which the claim was made in a household with multiple children. Thus, to avoid potential errors in estimation, the results and discussion focus on families with at least one child under the age of Exploratory analyses were also conducted among a subsample of GSS families that reported using child care in the past 12 months.
However, for reasons previously mentioned, results from the main analysis focus on the analytic sample composed of families with at least one child under the age of 12, regardless of reported child care use in the GSS. Table 1 displays the characteristics of families with at least one child under the age of 12 and characteristics of families that claimed and did not claim the child care expense deduction for the tax year.
Results from Chi-square tests are also presented indicating whether claimant families and non-claimant families were significantly different on the characteristics of interest. There were also significant differences in the characteristics of families who did and did not claim the child care expense deduction. Table 2 presents results from the logistic regression model predicting whether or not families claim the child care expense deduction among all families with a child under the age of 12 controlling for differences in key demographic, child composition, and employment characteristics of families.
A number of sociodemographic variables remained significant. Lone parent families were more likely to have claimed the expense deduction, with lone parents having more than two times the odds of claiming the deduction compared to two-parent families.
As well, the highest level of education in the household was significantly different between claimant and non-claimant families. Adjusted family household income quartiles were also different between claimant and non-claimant families after controlling for key variables in the final analytic model.
Low-income families, those in income quartile 1, had about three-fifths the odds of claiming the child care expense deduction than high-income families the highest income quartile.
Although claimant and non-claimant families differed by immigrant status, visible minority status and Indigenous identity in the descriptive analysis, once included in the final logistic regression model which examined all variables simultaneously, these demographic indictors were no longer significant predictors of families claiming the child care expense deduction.
Families living in rural areas had three-quarters the odds of claiming the child care expense deduction compared to families living in urban areas.
Provincial differences remained a significant predictor of claimant families in the final model. Families that resided in Quebec had higher odds of claiming the child care expense deduction compared to families residing in all other Canadian provinces except for New Brunswick and Prince Edward Island. The odds that families residing in Ontario claimed the child care expense deduction were half the odds of claiming for families residing in Quebec.
In the descriptive analysis, the percentage of participants claiming the child care expense deduction differed by the total number of children in the household; however, not by the total number of children under the age of 12 in the household or whether there was a child in the household under the age of 6.
In the final analytic model including key variables, having a child in the household between the ages of 12 and 18 remained significant. The odds of claiming the child care expense deduction were 1. Finally, child care expense claiming and non-claiming families differed by the work characteristics of parents. In other words, families where lone or both parents worked more than 30 h a week had higher odds of claiming the child care expense deduction.
The child care expense deduction is an initiative aimed at providing financial support for families with young children participating in child care by proving tax credits for applicant families. The expense deduction reduces the taxable income of applicant parents, and is of value to parents using child care to earn income, attend school, or conduct grant-funded research.
As such, the deduction may have a positive impact on the employment decisions of parents with young children, in particular mothers. The current study is one of the first to assess the usage of the child care expense deduction and is unique in the examination of the use of the expense deduction in the context of family demographic and work characteristics.
Utilizing linked data, analyses explored differences between claimant and non-claimant families, identifying characteristics of families associated with a higher likelihood of claiming the child care expense deduction. Overall, results indicated that there were demographic, child composition, and employment differences between claimant and non-claimant families, and suggested that certain families may be less likely to apply for the child care expense deduction.
A relatively small proportion of families claimed the child care expense deduction in Canada; less than a quarter of families with at least one child under the age of 12 in claimed the child care expense deduction during the tax year.
Additional analyses available upon request controlled for family child care use in the final analytic model and revealed similar results. Differences in the use of child care and parental work schedules may account for a portion of families that did not claim the expense deduction. In particular, families that rely on unpaid informal care provided by family members or friends and families where one or both parents are not working may be unable to claim the expense deduction.
There are several potential reasons why families may not claim the expense deduction. First, non-claiming families may participate in paid child care arrangements that do not provide the formal documentation, such as receipts, necessary for claiming the tax deduction. Moreover, non-claimant families may lack knowledge of the child care expense deduction, may perceive a high level of complexity in applying for the deduction, or may perceive the deduction as inconvenient or non-beneficiary Financial Accountability Office of Ontario Further still, it is possible that demographic characteristics of families may contribute to differences in claiming the expense deduction.
The current study found that differences in the likelihood of claiming the child care expense deduction were associated with demographic, child composition, and employment characteristics of families. Lone-parent families, families living in Quebec, and families with higher levels of household education and higher household incomes were more likely to claim the expense deduction. Claimant families were also less likely to have an additional child aged 12—18 in the household and were more likely to have parents that worked 30 h or more per week.
Families residing in Quebec were more likely to claim the child care expense deduction than most other provinces in Canada. Previous research indicates that the proportion of families using child care is not consistent across provinces, with the province of Quebec reporting the highest use of child care across the Canadian provinces Statistics Canada Child care is regulated at the provincial level and province-specific policies and programs may influence child care use.
The higher proportion of claimants in Quebec may reflect the higher rates of child care use in Quebec and province-specific programs, such as universal child care, that may encourage parents to utilize paid child care. Families with higher levels of education and higher household income were more likely to claim the child care expense deduction. Lower income families may be more likely to have a non-working parent or parents with an income that is less than the income amount necessary to benefit from the deduction.
Lower income families may also be less likely to claim the full amount spent on child care, since claimant parents in low income families may be bound by the income limit, whereby the claimant parent cannot claim child care expenses that exceed two-thirds of their income Laurin and Milligan Families with a child aged 12—18 in the household were less likely to claim the child care expense deduction than families without a child aged 12—18 in the household.
Families may rely on care by older siblings aged 12—18, old enough to provide supervision to younger sibling s under the age of 12, rather than using more formal types of paid child care. Finally, as expected, since the value of the expense deduction is generally tied to earning an income, working families were more likely to claim the child care expense deduction. However, there were differences in the likelihood of claiming the expense deduction even among working parents.
Families where a lone parent or both parents, in two-parent households, worked 30 h or more per week were more likely to claim the deduction than families that worked less than 30 h per week. Families that work fewer hours may be able to accommodate child care needs or may have more variable work schedules and may rely less on paid child care than parents who work full-time hours.
While this study provides valuable information on the use of the child care expense deduction among families in Canada, it is not without limitations. First, the data are from and More recent data were not available at the time of the study. However, since characteristics of families claiming the child care expense deduction have not been previously examined, this study provides a valuable contribution to the literature. Validating these results with more recent data would be possible if the GSS was to be linked with detailed tax information.
Second, the time frames of the two linked data sources do not exactly align, since the GSS was collected in and the T1FF represens data fromt However, focusing on families with a child under the age of 12 captures a larger proportion of claimant families in the analysis and further allows for comparisons across characteristics of claimant and non-claimant families. Finally, the work and child care preferences of parents are unknown.
It is unknown whether some parents choose to stay home and assume child care responsibilities or whether they prefer to be employed. Future research could assess the child care and work preferences of families with children under the age of 12, which may contribute to the variability in the likelihood of claiming the expense deduction.
The present study explored the demographic, child composition, and work characteristics that may provide insight into the reasons some families do not claim the child care expense deduction.
Overall, results indicated that certain families may be less likely to claim the child care expense deduction, in particular lower educated families, lower income families, and families where parent s work less than full-time hours. The findings support the value of using linked data to supplement tax information with demographic characteristics and contribute to the understanding of the characteristics of families who claim the child care expense deduction in Canada.
The authors declare that they do not have any competing interests. LH analyzed the data and was primarily responsible for writing the manuscript. While you can't deduct child care expenses on your tax return, you can take advantage of the child care tax credit instead.
The child and dependent care credit may be claimed if you incur child care expenses in order to work or look for a job. If you are married, both spouses must have earned income, although a spouse who is a full-time student for at least five months of the year also qualifies. The work requirement is waived if one spouse is incapacitated and incapable of self-care.
The credit allows you to subtract a percentage of your child care expenses from the tax you owe. The child and dependent care credit may also be claimed for a dependent who is physically or mentally incapable of self-care. For you to claim the child and dependent care credit, the child must be under age 13 at the time the expenses are paid and must be a qualifying child under Internal Revenue Service rules. Stepchildren or adopted children, along with siblings and foster children, can qualify as well as your biological children.
Descendants of any of these may qualify. You must be able to claim the child as a dependent and file an itemized return. This must be a joint return if you are married.
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