Being self-employed or working for someone else, would not matter when the Tax deadline arrives. Preparing your taxes can be an intimidating process. With Canadian tax laws and regulations ever-changing, it’s no wonder many Canadians are overwhelmed when reporting taxes. Having a good understanding of what is required of tax preparation services in Canada will make the process easier and less stressful. Talk to a tax consultant near me to help you with your income tax filing.

Here are the things you need to ensure even if someone else is preparing your tax returns for you:

  1. Ask your dentist, pharmacist, or another competent healthcare professional for an annual statement of your expenses. The statement should include your name, the date the service was provided, a description of the service/product, and the date of payment. This eliminates the need for individual receipts.
  2. The same goes for people with portfolio investments who need to report capital gains or losses. Ask your broker for a report for each portfolio for the full calendar year. If you have foreign investments, don’t forget to apply for a foreign ownership report as well.
  3. If you own a rental property or are self-employed, add up your expenses or provide a summary. It’s a great way to review your expenses to make sure they’ve all been recorded. Remember to keep all original receipts in case the CRA asks you to see them after you file your tax return. Even when trying to prepare a corporation tax return, this will still help.
  4. Back tax checks can take at least 30 days for the credit rating agency to process. Even if you paid on time, the CRA will charge interest for this processing period. Yes, the interest will come back to you, but not before you have a lot of time-wasting inconveniences. Answer? Pay CRA online.
  5. For those who wish to provide electronic documents for their tax preparation, free scanning software is available online or in app stores for your smartphone. Microsoft and Adobe offer apps that let you use your smartphone to scan receipts. For more information, watch these educational videos for Adobe Scan and Microsoft 365. Don’t take photos of documents. Scan them and make sure the images are easy to read. Remember that the CRA may wish to review these documents at a later date!
  6. Speaking of scanned images, don’t send separate images for each receipt. Gather as many as can fit on a piece of paper and scan them, again making sure all receipts are legible. Click here for more document-scanning tips.
  7. If you sell your primary residence, you must notify the CRA of the sale, your old address, the sale price and the year you bought it. It’s not a lot of detail, but it’s important.
  8. If you are an employee and had to work from home in 2022 due to COVID-19, you can claim a deduction for home office expenses. You can request $2 per day for each home business, up to a maximum of $500, or you can submit a detailed request with receipts. For more information, visit the CRA’s website or our article on ‘Claiming Work from Home Expenses’.
  9. And don’t forget the deadline for RRSP. This year it is March 1st. So if you’re topping up an RRSP and want the tax break to apply to your income in 2022, keep an eye on the calendar. Life can happen and you can forget.
  10. Tax returns should be prepared on time instead of piling up. Rushing to do those causes mistakes. Clients are frustrated when their tax return is unnecessarily delayed.
  11. Provide a checklist of information that may be needed for tax meetings. Printing the checklist on the client’s envelope (which includes a copy of the tax return and original documents) provides quick and easy access to next year’s tax return checklist.
  12. Have a list of all key contact information (names, titles, phone numbers, and URLs) readily available so you don’t have to search for it when needed.
  13. Communicate with your employees (and with each other) as often as possible to stay abreast of what’s happening in the industry. For example, if there’s a new problem with the software you’re using, or an issue causing electronic filing to be rejected, you can save everyone time by making sure they’re aware of any problems.

Talk to a tax consultant near me to help you with your income tax filing.

Important notes

Discover all the available deductions

Canadians can apply for income tax credits which can save them a significant amount of money. These deductions vary according to personal circumstances, such as whether an individual is a student, has children or dependents, or makes charitable donations.

Find out your permanent residence status

Your permanent resident status will determine what types of income you must report on your tax return, as well as the type of credits and deductions you may be eligible for. Before filing your return, it is important to understand whether you are a resident or non-resident of Canada for tax purposes.

Understand the difference between income earned in and outside Canada

If you’ve worked in multiple countries, it’s important to understand how different sources of income will affect your taxes in Canada. Different types of overseas income may be subject to different rules than income earned in Canada, so it’s important to ensure that all sources of income are accurately reported on your tax return. Even when trying to prepare a corporation tax return, this will still help.

Bottom line

Double-check everything. Before sending any forms or documents, check that they are correct. A small mistake can mean big headaches later if mistakes aren’t caught early enough. Even when trying to prepare a corporation tax return, this will still help. Talk to a tax consultant near me to help you with your income tax filing.

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