Canadian Personal Income Tax Checklist
It’s possible that tax season is the most dreaded time of year for you, but it doesn’t have to be if you take the time to prepare yourself and file early.
Breeze Through Tax Season
Follow these steps and tax season won’t have to bring with it a huge headache:
1. Get your financial information together from last year. Whether you choose to do your own taxes or have a company handle the process for you, your income, expenses, and deductions all need to be on-hand.
· Prior year’s tax return
· Notice of assessment
2. Get your forms together. Figure out which forms need to be filed, and have any employer-issued forms on hand. Your bank may have also issued a form about interest earnings.
T4 (employment income)
T3 (trust and dividend, mutual funds)
T5 (investment income)
Student loan interest
Child care payments
RRSP paid during the year up to the end of February
Public transit passes (only applies for before June 2017)
Spousal support payments made or received
Rental income and expense receipts
All personal information (SIN’s of all family members, address, date of birth, marital status, dependents, etc.)
All other information slips / receipts Software
3. Know the deadline. The personal income tax deadline is April 30, but this doesn’t mean wait until April to start getting things done. The sooner you start, the sooner last year’s taxes can be put out of your busy mind.
4. Don’t be late. Filing late will entail penalties, so don’t risk it and end up paying more. Get your tax return in as soon as you can. If you happen to need an extension, the Canadian Government does issue them in some situations, but apply for one sooner rather than later to ensure it is approved.
5. Find your tax preparer now. You should find a tax preparer as soon as the year ends, or even before, and book your slot. If you don’t get on their schedule soon, they will be over-booked and not able to take you on as a client. Don’t wait until the last-minute rush comes!
6. Plan for your tax burden. Once your tax returns are submitted, you can plan on how you will go about paying off any tax burden you may have. Although you need to have your form in by April 30, you can wait to pay at a later date. If needed, you can also setup a payment arrangement so that your taxes don’t disrupt your finances.
7. Plan for your tax refund. Are you one of the lucky Canadians that will be receiving a tax refund? If so, you probably won’t hesitate to get your tax returns filled out. But, your refund won’t be coming for a little while so filing early gives you plenty of time to plan on how you’ll spend it.
DIY Taxes Can Result In Higher Dues
It’s no secret that the Canadian tax system is complex and can cause quite a headache. Filing y
our own tax return can result in higher taxes due to missed deduction opportunities, and even accounting errors. Hiring a tax professional can increase your tax savings and save you a significant amount of stress.