1. It’s tax time again!
Make sure you can find all your tax papers and slips when you need them. Make a big envelope or shoe box your "official tax slip holder". Start with the letter that you received from the Canada Revenue Agency and add any document that may be tax related.
2. Tax filing is a “family affair”.
If you are married or have dependents, prepare the returns for yourself, your spouse and dependents at the same time. Only then can you (or your software) accurately prepare your tax returns and find the deductions, credits and transfers that can get you a better tax refund.
3. Don’t miss the tax filing deadline!
Have your return filed on or before April 30th. This will ensure that you will not be penalized for being late or have to pay interest on outstanding amounts. Plus, if you have a refund coming, the sooner you file, the sooner you get your refund back.
4. April 30th is the tax filing deadline for most taxpayers!
Unless you or your spouse are self-employed. Then you have until June 15th to file your return without penalty. But remember: you have until April 30th to pay any taxes you may owe, or interest will build on your outstanding balance.
5. Year-end tax tip - Medical expense tax credit
A taxpayer can claim a non-refundable tax credit for medical expenses paid by the taxpayer or the taxpayer's spouse. The allowed medical expenses include those paid for the taxpayer, the taxpayer's spouse, or a child under 18 who is dependent on the taxpayer or spouse for support.
6. Year-end tax tip - Tax-Free Savings Accounts (TFSA)
If you have a TFSA and you're planning a withdrawal, consider withdrawing before the end of the year rather than the beginning of next year since amounts that are withdrawn are not added to your contribution room until the beginning of the year following the withdrawal.
7. Year-end tax tip - Moving to another province
The income tax rate in the province you're living in as of December 31st determines how much provincial tax you will pay for the whole year. Therefore, if you're moving to a province with higher taxes, you may consider delaying your move until the next year.
8. Year-end tax tip - Registered Education Savings Plan
Grant room can be carried forward but there are still situations where the December 31st contribution date should be considered. If there are less than seven years before your child or grandchild turns 17 and you haven’t maximized RESP contributions, consider making a contribution by December 31st. If a child or grandchild turned 15 during the year and has never been a beneficiary of an RESP, December 31st is the last chance to contribute a minimum of $2,000 to an RESP in order to collect the 20% (Canada Education Savings Grant) for the current year and be eligible to the CESG for the following years.
9. Should you be filing a tax return?
Keep in mind that your tax return is also a benefits return. Even if you think you don't need to file a tax return, you should still do so to ensure that you claim any benefits you are entitled to.
10. Did you know you should file a tax return?
Even if your income is low and you believe you have no tax to pay? It can help increase your RRSP contribution room. As well, it allows you to claim any tax deducted at source and make your claim for the Goods and Services Tax Credit.
11. Students are entitled to substantial tax credits that should not be missed!
Any family member who is a registered student can claim an amount for the tuition paid. And remember, a student can also claim an education credit and an amount for books for each month spent as a full-time or part-time student.
12. Did you pay education fees last year?
Tuition expenses may be claimed on your tax return for any course provided by an educational institution, as long as the course cost more than $100 for the year. The course must improve occupational skills and be certified by Human Resources and Skills Development Canada.
13. Two plus two makes Five?
Little wonder that the most frequent mistakes the Canada Revenue Agency finds on tax returns prepared by hand are due to mathematical error. To avoid such errors, use a quality tax software like UFile which is also government certified for NETFILE.
14. Student loan interest is deductible.
Get a receipt for the interest charged on approved provincial and federal student loans. If you cannot use the deduction on this year’s tax return, a tax software like UFile is designed to carry forward and use the balance of interest in future years.
15. Don’t miss this important tax credit that can save you money.
Thanks to the Canada employment amount, you can claim a credit of up to $1,065 on employment income. Use a tax software like UFile that will find these credits automatically.
16. Transferring credits to others can save big tax dollars.
If you cannot fully use the credit that comes from your tuition and education credits you may be able to transfer them to a parent, grandparent or spouse. You may also choose to save what you cannot use for future years.
17. Transferring tuition credits can be tricky.
Only after you have used them to reduce your own taxes first, can the remainder be transferred, up to a limit of $5,000 per year. A quality tax software like UFile can ensure this transfer is done correctly and with maximum benefit.
18. Are you expecting a large tax refund?
This should be good news, however it may also indicate that the deductions from your pay cheque are too high. Filing an updated TD-1 form with your employer will provide information about any new dependents or other deductions that you can benefit from right away.
19. Calculating your tax return by hand can take hours, and cause many headaches.
Use UFile Tax Software to prepare your tax return quickly and accurately. Then, file it online using the Canada Revenue Agency’s NETFILE service to get your tax refund back fast!
20. Forget to report something on your tax return?
Don’t worry. If your tax return is filed and then you realize you forgot to report some income or a deduction, simply file a T1 Adjustment Request. UFile users will find this form in their software.
21. Do you want to save on your taxes? Be charitable!
If you give more than $200 in the year to registered charities, the percentage of your credit increases for those donations. For this reason, it is also generally best for couples to combine their charitable donations on a single return for the best tax refund.
22. Increase you tax refund
Claim medical expenses for any 12-month period ending in the tax year. For example, if you are paying for medical or dental treatments that started last year, and continue this year, you may take advantage of claiming them all next year.
23. New pension splitting rules can mean substantial tax savings!
If you or your spouse are receiving an income from an annuity or other pension plan, you may be eligible to split some of your pension income on your tax return. UFile calculates the most beneficial income split for you and your spouse.
24. Did you buy your first home after January 27th, 2009?
Don’t forget to claim the Home Buyers' Amount, a new non-refundable tax credit of up to $5000. Keep in mind, this amount can be split between you and your spouse or partner for maximum benefit.
25. Can I still claim the transit non-refundable tax credit for the 2017 tax year?
You may still be able to claim a non-refundable credit for the cost of eligible transit passes. The eligible period for your 2017 income tax and benefit return is from January 1 to June 30, 2017. This credit will be eliminated for future tax years.
26. Are you taking care of a parent aged over 65?
If so, you may be able to claim the “caregiver amount” on your tax return for each parent who is living with you who is infirm. To claim this credit your parent must be dependent on you.
27. Working from home can mean substantial tax savings.
When you have a home office that is clearly set apart from the rest your home and you have no office space dedicated to you by your employer, you may claim home office expenses such as electricity and heat according to the space dedicated to your office.