Not everyone has to file a tax return in Canada. But you might want to, to claim a refund or a number of benefits or credits.
Canada Revenue Agency (CRA) knows a lot about you! They receive information about you from various sources: from your employer (your T4 slip), from your financial institution (investment income, dividends, interest on T3 or T5 slips, RRSP or RRIF withdrawals on T4RSP or T4RIF slips), from pensions (T4A slips). These slips report whether or not any income tax was withheld at the source.
CRA compares your tax return with all the receipts they expect you to have received. If you have overlooked including some slips, they will reassess your tax return to include it. If you don’t file a return, CRA will assess you based on the information they have received from all sources, and will issue you with a tax assessment showing any tax you owe. CRA however will not calculate and send you a refund. In order to claim a refund, you have to file a tax return annually.
A number of benefits or credits depend on you filing an annual tax return:
• The Canada Child Benefit is paid to families with children under age 18, who meet the criteria of the program, based on information you report on your annual tax return.
• The GST/HST credit is a quarterly payment for individuals or families who qualify, based on information you report on your annual tax return. The maximum annual amount for a single tax filer with no children is currently approximately $456.
• For Canadians over age 65 who receive Old Age Security (OAS) Benefits, the Guaranteed Income Supplement (GIS) is available to those who meet the income test. A single senior with income of $18,648 from all sources (not including OAS) would be eligible for the GIS.
If you don’t file a return, the payments will cease even if you would qualify. Also, if you don’t file a return, deductions and credits that might help you get a refund are not automatically considered. We will deal with these in another section of this series.
The filing deadline is April 30. If this falls on a weekend, the deadline is extended to the next Monday.
We hope you will find this information valuable and will increase your financial confidence. You can always find these articles on our website anytime at www.actionfinancialgroup.com.
Karin Rimnyak, Certified Financial Planner®
David Dryburgh, Certified Financial Planner®
Ian Barrie, Certified Financial Planner®
This information has been prepared by Karin Rimnyak who is an investment Advisor for iA Private Wealth. Opinions expressed in this email are those of the Investment Advisor only and do not necessarily reflect those of iA Private Wealth. iA private Wealth Inc. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada. iA Private Wealth is a trademark and business name under which iA Private Wealth Inc. operates.