4 Things Canadians Should Consider When Filing Income Tax Returns
Filing your income tax return as a Canadian citizen is a big responsibility. Whether you’re filing it at home or somewhere abroad, you still need to file it before the deadline. Individual taxpayers would need to file their income tax returns before April 30, while business owners have until June 15.
There are four things to keep in mind when filing your income tax return:
- Gather All Documents Required For Your Income Tax Return.
Make sure that you have the pertinent information you need to prepare for your income tax return. Your social insurance number, tax information slips, receipts, and other financial documents should be ready and on hand. You should also know your personal tax information like your RRSP contribution limit.
- You Can File Your Income Tax Return In More Ways Than One.
After getting all of your pertinent documents and income tax return ready, file your income tax in any of the four ways:
- File your income taxes online using NETFILE (as shown in the image below);
- File your income tax return via a web application certified by the CRA. Once filed, you can get an immediate confirmation of the filing;
- File your income tax return by postal mail, or.
- Pay a service provider to file your income tax return via EFILE
If you are too busy to deal with the preparation and filing of your tax documents, get Canadian tax help. hire an accountant who can help you and represent you if needed. Your accountant will come in handy if you are running a small business too and don’t have the time to work on your income taxes.
NETFILE program for filing income tax returns online. Image source: Canada Revenue Agency
- Seek Voluntary Disclosure Application.
Use a Voluntary Disclosures Program If you want to change your previously filed income tax return, use a Voluntary Disclosures Program. This way, you can get relief from your penalties and other charges levied to you by the Canada Revenue Agency. Just make sure that you file the disclosure in person, so you can provide all the details needed to verify your claims, and pay the total amount or in agreed installments.
If you own a small business and struggling at this point, you can use the Voluntary Disclosures Program to declare your bankruptcy. The CRA in turn will decide whether your disclosure application is approved. Companies like Canadian Tax Amnesty exercise a no-names disclosure policy when they approach CRA on your behalf.
- Use The Income Tax Deductions To Your Advantage.
Income tax deductions can be your best weapon when it comes to paying fewer taxes. Child support payments and child care expenses are just two income tax deductions in Canada you can take advantage of. There are tax credits available for small businesses as well. If you are an employee, you can also avail of the search and rescue volunteer tax benefit or moving expenses tax deduction.
On the other hand, you would need to come up with a strategic plan on how to best utilize your income tax credits. You can coordinate with your tax accountant to work on this tax plan. You tax accountant has the knowledge about the requirements to claim specific income tax deductions. Your tax accountant can also help determine which tax deductions are suitable for you.
Filing your income tax return can be a cumbersome affair to deal with. But it shouldn’t be that difficult. Also, you can always hire a tax accountant to make things easier.