10 issues to know earlier than you file your tax return this yr


Jamie Golombek: Tax season is in full swing and people who’ve already filed and claimed a refund are getting a median of $2,145 again

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Tax season is in full swing. Digital submitting began on Feb. 21 and the Canada Income Company to this point has already obtained a bit of greater than 2.4 million returns, 95 per cent of them filed electronically. Simply over two-thirds of tax filers have claimed a refund on their 2021 returns, with the typical refund coming in at $2,145.

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Listed below are 10 issues to bear in mind as you’re employed your manner via this tax season.

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The deadline

The traditional tax-filing deadline for most people is normally April 30, however you have got till Could 2 this yr to file as a result of April 30 falls on a Saturday. For those who or your partner or common-law companion had self-employment revenue in 2021, you have got till June 15 to file your return(s). In both case, you probably have a steadiness owing, it have to be obtained or processed at a Canadian monetary establishment on or earlier than Could 2, 2022 to be thought-about paid on time.

COVID-19 advantages

For those who obtained COVID-19 advantages, such because the Canada Restoration Profit, administered by the CRA in 2021, you must have obtained a T4A tax slip from the federal government in February. (Quebec residents would even have obtained an RL-1.)

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It’s essential to understand that some tax was withheld at supply when the COVID-19 advantages have been paid, however you could find yourself owing further tax on high of that. The CRA has acknowledged this might current important monetary hardship for some taxpayers. Affected people could want to reap the benefits of the CRA’s expanded cost preparations, which will provide you with extra time and adaptability to pay the tax owing, based mostly in your monetary scenario.

A COVID-19 benefit cheque.
A COVID-19 profit cheque. Picture by Peter J. Thompson/Nationwide Put up

One-time cost for seniors

Seniors who have been eligible for the Outdated Age Safety pension in June 2021 and have been born on or earlier than June 30, 1947, (that means they’ll flip 75 by July 1, 2022) obtained a one-time $500 cost in August 2021. All eligible seniors, no matter revenue degree, obtained the $500 cost, which was meant to “assist older seniors’ larger bills,” and was estimated to use to three.3 million folks.

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Most eligible seniors could have by now obtained a T4A slip from Service Canada for this quantity, however some slips could have been delayed and can exit through the week of March 14, 2022. A small quantity obtained an incorrect slip, with duplicate quantities in packing containers 018 and 205. Amended slips have been issued to those people, so be sure to use the proper slip when finishing your return.

Local weather motion incentive cost

For those who’re a resident of Alberta, Saskatchewan, Manitoba or Ontario, you now not declare your climate-action incentive (CAI) in your tax return. As a substitute, you’ll robotically obtain your CAI funds 4 instances a yr, beginning in July 2022, supplied you file a 2021 return and qualify for funds. The July cost will embody a retroactive quantity for April 2022, and future funds can be made on the fifteenth of April, July, October and January.

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House-office bills

For those who labored from residence in 2021 resulting from COVID-19, you could be eligible to assert a deduction of as much as $500 yearly for home-office bills in 2021 utilizing the short-term flat price methodology. Or, you might be able to declare your precise bills below the detailed methodology.

Eligible Educator College Provide Tax Credit score

This tax credit score was expanded and enriched for 2021 to permit lecturers to assert a 25-per-cent refundable tax credit score for purchases as much as $1,000 on eligible educating provides purchased in 2021. The federal government additionally expanded the checklist of eligible educating provides to incorporate digital gadgets, equivalent to calculators, digital timers and instruments for distant studying.

Teachers can claim a 25-per-cent refundable tax credit for purchases up to $1,000 on eligible teaching supplies bought in 2021.
Lecturers can declare a 25-per-cent refundable tax credit score for purchases as much as $1,000 on eligible educating provides purchased in 2021. Picture by Carl Recine/Reuters

Add your e mail tackle for My Account

As a fraud prevention initiative, it’s necessary as of Feb. 7, 2022, to supply the CRA with an e mail tackle to entry the net My Account portal. This permits the CRA to tell taxpayers, in actual time, of any modifications made to their account to assist guarantee such modifications are licensed. The CRA has additionally added multi-factor authentication for all customers and also you’re now required to enter a one-time passcode every time you signal into the CRA’s digital companies.

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Taxpayers have the choice to obtain both paper mail or e mail notifications when CRA correspondence is obtainable for viewing electronically in My Account. However be forewarned: if you choose the digital notification possibility and miss an essential CRA e-mail, you could possibly in the end be on the hook for curiosity and penalties, as a 2021 case has proven.

Auto-fill my return

This CRA service has been expanded for 2022, and might now present downloaded tax slip info, together with registered retirement financial savings plan (RRSP) contribution receipts, for 2021 and the earlier 5 tax years (as a substitute of 4), which may assist when submitting older returns.

Automated callback service

For those who get annoyed ready on maintain to talk to a CRA agent, a brand new service (“when obtainable”) could permit you to request a callback. The service could also be obtainable to callers on the person tax, advantages and enterprise enquiry traces, however solely at sure instances of the day and solely when wait instances attain a sure (unspecified) size.

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Digital information subscription tax credit score

Lastly, should you’re studying this text on-line and also you’ve paid for the digital newspaper app or web site, you might be able to declare the digital information subscription tax credit score, price 15 per cent on qualifying bills as much as $500 for quantities you paid in 2021. It’s essential to have paid the quantities to a professional Canadian journalism group for a digital information subscription with content material that’s primarily written information. An inventory of qualifying digital information subscriptions may be discovered on-line.

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In case your subscription consists of each print copies of the paper in addition to on-line digital entry, solely the price of a standalone digital subscription (or a comparable one) is an eligible expense. If there’s no standalone or comparable subscription, you’ll be able to solely declare 50 per cent of the fee as an eligible expense.

Jamie Golombek, CPA, CA, CFP, CLU, TEP is the managing director, Tax & Property Planning with CIBC Non-public Wealth in Toronto. Jamie.Golombek@cibc.com 

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