Technology can help ease your tax-season pain
March is here and you’re probably thinking about spring and all kinds of outdoor activities. Unfortunately, spring coincides with another yearly ritual which may keep you indoors. It’s time to file your income tax return.
Luckily your computer and the internet can provide the help and advice you need to make your tax duty less irksome.
In the past doing your taxes meant secluding yourself at a desk with a calculator and a stack of tax forms and slips. Or you dropped everything off at a tax accountant. These days it’s more likely you’ll turn to your computer to perform the calculations and file the return, and the whole process might not cost you anything.
Last year about 30 per cent of Canadian taxpayers used their own computers or mobile devices to calculate their taxes and file online using a service provided by the Canadian Revenue Service (CRA) called Netfile. It’s not hard to figure out why. Using a tax preparation program is usually as simple as filling in blanks and all of the calculations and maximum deductions are done for you. After the return is filed online a refund typically arrives within a couple of weeks. An extra bonus is that eliminating paper returns saves a forest of trees and the CRA avoids the wasted time and errors that inevitably occur when manually processing millions of forms.
If you decide to use your computer or mobile device to do the calculations and file the return you essentially have two choices.
One is to purchase a tax program by downloading it from a company on the internet or getting it from one of those displays which have popped up in stores all over town. You install the software and all of the data is stored on your computer and you can back it up and import it into a tax program when you begin the tax process next year.
The other choice is to use an online service. You create a password-protected account at a tax preparation website and then follow the instructions by entering your personal and financial details.
When you’re finished you can Netfile your return directly from the website.
Although you do not have to install any software all of your personal and financial details are stored on the tax service’s computers, so keep your password confidential. Although the process seems pretty simple, the difficult part may be choosing which software or service you’re going to use.
Three big tax preparation companies that offer both downloads and online services are H and R Block (https://www.hrblock.ca), Intuit’s Turbotax (https://turbotax.intuit.ca), and Ufile (http:// www.ufile.ca), but in the past few years there has been a huge increase in the number of companies offering to help you with your taxes. Your decision becomes a bit more complicated because there are also tax return programs for an iPhone, iPad, or Android tablet or phone.
Luckily, every program or online service must be approved by the CRA and its website (http://www. cra-arc.gc.ca/netfilesoftware) has a detailed listing of all of the programs and their options.
The good news is that filing your income taxes may not cost you anything. Both H and R Block, Turbotax, and Ufile will do simple returns online or by downloadable software for free whereas Genutax (www.genutax.ca), and StudioTax (www.studiotax.com) have always been free and Simple Tax (https:// simpletax.ca) asks you to pay what you want. Also most tax preparation and Netfiling is free if you have a net income of less than $20,000, you’re a post-secondary student, or are filing for the first time.
If doing your taxes with software seems overwhelming then do not despair.
The CRA website has tons of useful information, downloadable forms, and a list of free tax clinics provided through the Community Volunteer Income Tax Program (www.cra-arc.gc.ca/ volunteer). Keep checking the list since new clinics are constantly being added.
You may not be able to escape income tax time, but your computer or mobile device and the internet can help get you outside much faster.