The arrival of fall is a great time to start thinking about, and making plans to prepare your personal income tax return.
Every year, we Canadians fail to claim millions of dollars in tax deductions and credits. While filing your income tax return on time is a priority, staying on top of tax benefit changes is something most of us simply do not have time for.
For many Canadians there is a belief that tax deductions are only for high-income earners, or those with a savvy financial advisor.
Not so! Online tax software, such as UFile, allows everyone – regardless of income - to benefit from available tax credits. Better yet, students, seniors and low-income Canadians are among the millions of people eligible to prepare and file their taxes using UFile’s online tax software absolutely free.
Such tax preparation software tools are designed to automatically find all of the tax deductions you are entitled to, resulting in a lower tax bill or an increased income tax refund.
If you’re like most people, you’re probably aware that you can deduct certain expenses from your taxable income, such as charitable donations, childcare, medical and home office expenses. However, there are a large number of more specialized tax deductions that many Canadian tax filers miss out on every year. These include items like equivalent-to-spouse credits, pension income credits and carrying charges.
With the equivalent-to-spouse credit, if you’re a single parent trying to cover the financial challenge of raising a dependent child under the age of 18, this non-refundable tax credit may apply to you.
What about those collecting their pension? If you’re over the age of 55 and receiving some form of pension income (with certain key exceptions), you may be eligible for a non-refundable tax credit of up to $2,000.
As for carrying charges, while most people have never heard of them, they actually apply across a very wide range of financial products and are available as an eligible tax deduction to a great number of Canadian income tax filers. Carrying charges include items like the interest you pay on an investment loan, as well financial advisor fees and the management fees on non-registered investments, such as mutual funds, GICs, segregated funds, etc.
For more information on these and other commonly overlooked Canadian income tax credits, check out The Financial Consumer Agency’s website:
Also, visit the main Canada Revenue Agency online services website for easy to read, useful tax information:
As a memorable Morgan Stanley ad said:
“You must pay taxes. But there’s no law that says you gotta leave a tip.”