If your monthly pass costs $100,
your tax credit in 2006 would be $91.50 (six months multiplied by 15.25%). Remember, the program commenced as of July 1, so only six months of passes will be calculated for the credit in 2006. In 2007, when the lowest marginal tax rate will increase to 15.50% and the tax credit for public transit passes can be applied to the whole year, the credit could reduce your taxes by as much as $186.
You will be eligible to claim the tax credit for public transit passes on your 2006 income tax return for the amounts you have paid for travel that occurs after June 30, 2006, but you must have proof of purchase. At a minimum you need to keep your expired monthly transit passes for months after June 2006 to support your claim. Visit the
Canada Revenue Agency website for additional information about how to qualify and claim the credit.