by Janine Rogan
Tax season is upon us! Individuals have been able to e-file their tax returns since February 18th, 2019 and employers were required to send out T4s by the end of February. So, at the beginning of March, you would have been in a position to file your tax return. If you haven’t already filed yours, I’ve put together a few tips and tricks to help you understand what you need to gather before the April 30th deadline so that you can quickly, efficiently, and painlessly file your 2018 tax return.
- Find a program that lets you file your taxes online. Bonus points if the program is free. There are a number of online software programs available to Canadians and many of them offer a free version if your return isn’t complex. Finding a program that is easy to use is going to save you time and money. In reality, you don’t need to pay someone to do your taxes unless you have a complex tax situation. If you have only a few tax slips, any of the online programs will provide easy step by step instructions on where to plug in numbers. Plus, if you have access to CRA online you should be able to automatically upload many of your tax slips along with your return.
- Collect all of your slips! Any document you receive from January – March could be a tax slip. The most common slips are: T3s, T4s, T5s, RRSP slips, donation receipts, T2202A etc. If you don’t know if a slip is for taxes you can always Google it, but chances are if it shows up in your CRA online account it’s for tax purposes.
- If you don’t already have access to CRA online, you may want to set that up as soon as possible. It is a secure portal that lets you view your personal income tax and benefit information and manage your tax affairs online. Overall, online access will make your life much easier when it comes to filing your taxes.
- Reporting income that is not included on a T4 slip. There is a rumor every year that if you make money (think cash tips, money from babysitting, a side hustle) you don’t have to pay tax on it, or you only have to claim a portion (10% of tips, for example). This isn’t true. All income is required to be reported on your tax return to the CRA. If you don’t, you are breaking the law, and we don’t want that. Make sure you keep track of all your income during the year, in addition to any expenses incurred to allow you to earn that income. These expenses can be deducted from your income to help lower your tax bill.
- Last but not least, don’t be afraid of the CRA! So many people think they will be audited, or that if the CRA contacts them they are in trouble. Most filings are online these days and may not require the submission of all of your backup documents so, as a result, CRA has a process to review random returns to ensure you have the appropriate receipts for the claims you are making. Be transparent, if you made a mistake, own it, they know you are human and working with them will put you in the best position with them going forward!
I’m the founder of JanineRogan.com a financial literacy resource that helps professionals master their money. I’m a CPA and tax specialist and over the years I have dedicated countless hours to sharing my knowledge through writing and speaking. I am passionate about educating people about their money so they can use it as a tool instead of having it cause stress in their life. Building wealthy habits is important early on, and understanding your values will help you make the best decisions for your money.