Ok, maybe enjoy isn’t the right word. Filing your taxes isn’t usually on the top of peoples’ list of favourite activities. But with our advice, you breeze through tax season (remember: June 1, 2020 is the new deadline) and start thinking about the fun stuff, like the sunshine that’s starting to come out a little more each day.
1. Make it easy on yourself
Don’t wait until the last minute to start organizing your paperwork. Give yourself time to gather what you need. If you receive your tax receipts electronically, maybe create a specific folder on your computer and quickly save your documents as they come in. If you receive your statements in the mail, create a tax pile in a specific place in your house. It’s a simple step that will save you a lot of stress and time in the end.
2. Know the forms you need to prepare
Everyone’s filing will be different but some common things you’ll want to have ready include:
- T4 slips
- Employment insurance benefits
- Tuition and education amount forms
- Old Age Security and CPP benefits
- Workers compensation benefits
- RRSP contribution receipts
- Charitable donation receipts
- Transit pass receipts
- Child care expenses
- Children’s arts and sports activities
3. Know your taxable income
With some exceptions, investment and interest income are considered taxable income. Financial institutions will send you the appropriate slips if you earned an investment income of $50 or more, but you’re required to report it even if you don’t get a statement.
This investment income includes interest received from savings accounts, term deposits, and so on. Investors also need to report their capital gains and RRSP withdrawals. TFSA withdrawals are not taxed.
4. Lean on the pros
If your tax situation is complicated with many moving parts, it may be best to rely on the professionals to do the job. But always make sure you do your research and look for a professional that provides good value in cost and quality. Some offer discounts if you’re a student. So, shop around.
5. Go online to save some time
For those less complicated tax filings (or maybe you just love doing things on your own) , there are lots of software products available online to help you file your tax return. Most of them have made the previously daunting task much simpler by breaking it down piece by piece and asking you simple, clear questions. Plus, if you’re a Coast Capital member, you save up to 20% on TurboTax Online products.
The deadline for individuals to file their taxes is June 1, 2020 so it’s time to get busy.