TORONTO - Did you know...you can reduce your tax bill and save a bit of money at the same time? Here are a few tips, courtesy of your friends at the Canada Revenue Agency (CRA), when filing your 2010 Income Tax and Benefit Return.

1. Any income you earn in an RRSP is usually exempt from tax as long as the funds remain in the plan. You save for your retirement and get a break at tax time too.
2. As long as you stay within your contribution room limit, you will not pay tax on any income you earn from investments in your tax-free savings account.
3. Does someone in your family regularly take the bus, train, subway, or ferry to work? You may be able to get a non-refundable tax credit for the cost of the transit passes by claiming the public transit amount.
4. Have you retired and now receive a pension? You can split up to 50% of eligible pension income with your spouse or common-law partner to reduce the overall taxes you pay.
5. Do you work in the trades? Tradespeople can deduct part of the cost of eligible tools purchased throughout the year.
6. Did you buy your first home in 2010? Check out the home buyers' amount to see if you qualify.
7. Are you a single parent receiving the Universal Child Care Benefit (UCCB)? The Government of Canada released new UCCB measures in the 2010 Budget that may apply to you.

For people who are self-employed
8. Did you purchase a computer for your business after January 27, 2009, and before February 2011? If so, you may be eligible for a 100% computer capital cost allowance.
9. Did your business employ an apprentice? A salary paid to an employee registered in a prescribed trade in the first two years of his or her apprenticeship contract qualifies for a non-refundable tax credit for the employer.
10. Did your business (which is not a primarily child care services business) create licensed child care spaces for the children of your employees? If so, you may be eligible for the investment tax credit for child care spaces for each new child care space you created.

Now, some things that may not be good ideas to do, unless your dream is a tax audit.

1. No matter how much you love your pets, Puss, Rover and Goldie should never be claimed as eligible dependents.
2. Don't claim a portion of your gas, water, and hydro bills as business expenses if your business is an illegal marijuana grow-op in your basement.
3. Claiming your kids' weddings as a business entertainment expenses because you invite a few of your clients.
4. If you own a business, paying your teenager $75,000 to answer the phone,  your spouse $120,000 to do the banking, and your mom $85,000 to pick up your monthly supplies from Staples might raise a few eyebrows.
5. Claiming that you drove 100,000 km for business travel. Where the hell did you go, Buenos Aires every month?