13 Things Your Ac­coun­tant Wants You to Know


1The holy trin­ity of quick re­funds: file early, file on­line and opt for di­rect de­posit. Some e-fil­ing com­pa­nies re­port turn­arounds as short as eight busi­ness days.

2Did you win a prize in a raffle at work or re­ceive any gifts or re­wards from your em­ployer? If their value to­tals more than $500 a year, you’ll have to pay tax on them. An ex­cep­tion: fre­quent-flyer miles or loy­alty points earned when us­ing per­sonal credit cards to book busi­ness travel—un­less they’ve been con­verted to cash.

3Fil­ing late in it­self won’t hurt your credit rat­ing, but it could lead to penal­ties and in­ter­est that will ratchet up the amount you owe the gov­ern­ment. If you don’t pay that debt, the Canada Rev­enue Agency (CRA) can gar­nish your in­come or even get a court or­der to seize your as­sets.

4File even if you can’t pay. While both fail­ure-to-file and fail­ureto-pay penal­ties ex­ist, the first is gen­er­ally harsher. And don’t panic if you can’t pay what you owe: you may be able to work out a pay­ment plan if you can prove that you truly don’t

have the means. You can also have penal­ties and in­ter­est waived for fi­nan­cial hard­ship due to cir­cum­stances be­yond your con­trol, such as ill­ness or job loss.

5If your in­come is mod­est—less than $30,000 an­nu­ally for a sin­gle per­son or $40,000 for a cou­ple—and your tax sit­u­a­tion is rel­a­tively sim­ple, vol­un­teers can help you pre­pare your on­line in­come tax re­turn for free. Clin­ics are usu­ally held at com­mu­nity cen­tres in March and April. Visit Canada.ca for de­tails.

6Item­iz­ing can yield a big­ger re­turn, but be care­ful: too many de­duc­tions may in­crease your chances of be­ing au­dited.

7One red flag? Ex­ces­sive busi­ness de­duc­tions. The best de­fense is ac­cu­rate records. If you drive for work, the MileIQ app will keep tabs on the kilo­me­tres you rack up. Mean­while, apps such as Fore­ceipt al­low you to take pho­tos of re­ceipts or scan your e-mail in­box to in­stantly log busi­ness ex­penses.

8Keep­ing those re­ceipts (for six years) is cru­cial, says Shan­non Mathieu, CPA at White­haven Ac­coun­tants in Ajax, Ont. “Peo­ple think that their credit or bank state­ments are enough, but they aren’t ac­cepted as backup for the CRA,” she says. “State­ments don’t show what the ac­tual pur­chase was for.”

9You could get hun­dreds back by ap­ply­ing over­looked tax de­duc­tions. Claim­ing med­i­cal ex­penses— in­clud­ing pre­scrip­tions and den­tal vis­its—is al­lowed, for ex­am­ple, if they to­tal more than $2,237 or three per cent of your in­come.

10Has an el­derly par­ent moved in with you? Even if they’re still healthy, you can claim the care­giver amount, as long as they’re over 65 and have an an­nual in­come be­low $22,728.

11If you col­lect a pen­sion, you’re al­lowed to split up to half of your el­i­gi­ble pen­sion in­come with a spouse, shrink­ing your over­all tax bur­den.

12To avoid an au­dit, don’t use round num­bers—the CRA may as­sume you’re guess­ing on ex­pen­di­tures.

13If you do get a tax re­view no­tice (gulp!), don’t go it alone—hire an ac­coun­tant or a tax at­tor­ney. “A pro­fes­sional can re­spond on your be­half with the right doc­u­men­ta­tion and ref­er­ences,” says Mathieu. “This can help avoid a re­assess­ment or a more in-depth au­dit.”

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