Why should I file a tax return?

If you owe tax, you have to file a tax return. If you don’t owe tax, filing a tax return will allow you to take advantage of certain tax credits that will either increase your tax refund or carry forward to reduce tax payable in the future.

• GST credit (up to $421 per year)

• BC Low-income credit (up to $115.50 per year)

• Working income tax benefit (for low income)

• Purchase your first home? There is a first time homebuyers tax credit of $750

• Some organizations often require a Notice of Assessment to determine special allowances (ie. retirement assistance, etc.). You will only receive a Notice of Assessment if you file your tax return

Did you attend and pay for university during the year? Tuition paid to colleges, universities and other accredited education institutions should qualify for a tuition credit. This can be used to reduce the tax you pay now, or if you are not currently earning income, it can be used to reduce tax payable in a future period!

Filing a tax return will help generate RRSP limit, allowing you to make RRSP contributions which reduce your net income. You can carry the unused amounts to build up RRSP contributions for future years.

Tax heads-up! Earning more than you spend? Consider RRSP contributions or donations.

What do I include in my tax return?

You must include all types of income earned during the year in your tax return. Some common types of income and corresponding tax slips you receive are:

Type of Income / Tax information

Tax Slips you should receive:

• Employment income

• T4

• Investment Income

• T3, T5, T5013

• Employment insurance and other benefits

• T4E

• Tuition / education receipts

• T2202A

• Workers’ compensation benefits

• T5007

• Self-employment income (endorsements, prizes, public appearances etc.)

No slip? Keep organized records of your income and expenses during the year – this must be reported on your tax return.

How do I file my tax return?

Payment of taxes owing and filing your return is required by April 30. Some tax returns are simple, while others can be complex. There are a number of “do-it-yourself” filing options or you can hire a professional accountant to prepare your tax return.

Free options: Canada Revenue Agency has a list of free tax software.

Check out their website 

Paid options: Many choices on the market: TurboTax, Ufile, Profile, and TaxPrep are just a few.