Can I deduct childcare costs on my Canadian tax return if I live in Ontario?

Yes, the child care expense deduction is a federal deduction available to Ontario residents under the Income Tax Act. It applies to amounts paid for child care to allow you (and your spouse/common-law partner) to earn employment or self-employment income, attend school, or conduct research. Eligible expenses include daycare, babysitters, day camps, and overnight camps up to a per-child annual maximum that depends on the child's age and any disability.

The deduction must generally be claimed by the lower-income earner in the family — this is a legislated rule, not just a planning tip. The higher-income spouse can only claim in limited situations (the lower-income spouse is in school, incapacitated, in prison, etc.).

You can only deduct amounts actually paid to an arm's-length care provider. You need the provider's Social Insurance Number (for individuals) or business number (for organizations). You do not attach receipts when filing, but you must keep them. Ontario does not have a separate provincial child care deduction — the federal deduction reduces income for both federal and provincial tax calculations because it lowers your net income on Line 23600.