Wednesday, April 18, 2018

Tax Time

It is officially tax time, and with the April 30th deadline looming, here are a few tax tips to help you file pain free.

Avoid getting too creative with your 'other deductions'
-  Line 232 otherwise labeled as 'other deductions' is not an invitation from the CRA to list whatever big expenses you've had over the year
- There is a specific list of claims that qualify. Read that list here
- You need receipts for all of the expenses you claim (i.e: medical expenses or donations)
- While you no longer need to mail in your receipts, you do need to hold onto them should the CRA question any of your expense claims

Don't play hide and seek with the CRA
- Make sure the CRA knows where to find you
- If the CRA asks you for more information after you’ve submitted and are unable to reach you, it will deny or modify claims based on the information it has (which could result in a bigger tax bill)

Know what's new for 2017
- Under new legislation, there are old tax breaks that you can no longer claim, as well as, new tax breaks that you may quality to claim

      New tax breaks:

  • Canada caregiver credit – If you care for an infirm family member, things just got a little easier. The Liberals streamlined three previously existing tax breaks into the Canada caregiver credit.
  • Disability tax credit – The government has added nurse practitioners to the list of health professionals who can certify Canadians living with a disability for this tax break.
  • Medical expense tax credit – Fertility treatments can cost thousands of dollars and aren’t often covered under provincial health plans. You may be able to claim some of those costs in your tax return this year. Also, the Liberals have made the change retroactive, so if you’ve paid for things like in vitro fertilization during any of the past 10 years, you can refile your taxes and add that in.
Make sure you have all of your tax slips
-Depending on your employment status there are specific slips that you will need to file your taxes.

  • If you’re an employee, a T4, Statement of Remuneration Paid form, which shows how much your employer paid you. 
  • If you’re retired, a T4A, Statement of Pension, Retirement, Annuity and Other Income, which shows you much you earned in retirement payments. 
  • If you made money from investing or earned interest in a savings account, you’ll need a T5, Statement of Investment Income, which shows items such as dividends, interest from bonds or money you loaned, and much more. 
  • If you received Employment Insurance (EI), a T4E, Statement of Employment Insurance and Other Benefits. 
  • If you received worker’s compensation or social assistance, a T5007, Statement of Benefits.
Know your limit
The CRA will penalize you for over contributing to your RRSP and TFSA
- Be sure to review your notice of assessment, or check your MyCRA account, for your contribution limits

Be sure to claim any foreign income
- If you have any type of foreign income-even though you're a Canadian tax payer you will need to claim it
- You will get a credit from the government, and you will not be taxed twice, but none-the-less it needs to be claimed, or they will come after you