Filing your income tax return late? If you’ve held back fearing tax debt, here are a few tips to get you back on track.
Every year Canada Revenue Agency (CRA) sets the deadline of April 30th for all Canadian personal income tax returns to be filed. Despite the firm deadline, many people file late returns for a variety of reasons. Some of the reasons that hold people up from filing can be easily solved. However, we also see people every day who have held back on filing their returns out of fear of owing tax debt.
While fear isn’t something that you can “solve” it is something you can take steps to conquer. We know that tax debt can be scary, but you’ve got options and we don’t want you to live in fear of your tax debt. If you’ve got “barriers” holding you back from filing your return, our Spergel tax tips will give you the power to get back on track as quickly as possible. Let us help you with your fear and your tax debt.
Tip Number One – Combating Cost Concerns
One of the obstacles people face when it comes to filing income taxes is the cost. An accountant doesn’t come cheap, and who wants to pay money for a tax service AND pay a bill to CRA. Even if you don’t think that you can afford to do your taxes, there is likely a way for you to get them done inexpensively (or for free). Our first tip is that where there is a will, there is a way. Here are a few ideas on how to file your tax return on a budget.
- Try to do it yourself (you can do a paper return for free, you don’t even need a computer and Canada Post locations usually have tax booklets that you fill out and return by mail).
- Visit a FREE income tax clinic. You can find a clinic in your area on the CRA website here.
- Ask family and close friends if they know how to file a return and get help.
- You may be eligible (if you have received an invitation) with CRA to have a CRA representative “file” your return by phone. To learn more about this option please click here.
Tip Number Two – Medical Receipts Made Easy
To file your tax return, you will need all of your income slips and any deductions/receipts that you can use to reduce what you may owe. Medical receipts are a common problem for many people. Over the year prescription receipts can go missing. If you bought new glasses last July do know where that receipt is today? Fortunately, when it comes to medical expenses there is an easy way to get this information. Speak to your pharmacist and request a copy of your prescription payment history for 2018. For vision/dental, ask your optometrist/dentist. Once you have all of your totals, check to see that they add up to greater than 3% of your earnings. If your medical is less than 3%, your receipts won’t reduce what you owe. If you’re on a good group benefit plan you may not need medical receipts and can file your taxes right away without them.
Tip Number Three – Tracking Down Tslips
A very common reason for filing a late income tax return (that may be unrelated to tax debt) is a missing “T” slip (income slip). If you work for a company that deducts income taxes for you, or collect government retirement pension income (CPP and/or OAS), each year you will be issued a T4 slip. If you are on social assistance or receiving disability, you’ll receive a T5 slip. T slips can get lost in the mail or at home, especially if you’ve recently moved. Don’t let a missing slip hold up your income tax return. Log into your My Service Canada account, or call Canada Revenue Agency to request your missing slips.
Understand Why Late Filing Matters
Even if you don’t expect a tax debt, it’s always best to file by the filing deadline. Canada Revenue Agency keeps extensive records on every taxpayer. If you regularly file late returns, this could become a problem if you have tax debt in the future. If you have a history of not filing at all, during consumer proposal negotiations, CRA may ask you to include a requirement in your proposal to file your taxes on time. Don’t let filing late now impact your chances of easier negotiations with CRA later. You won’t be penalized for filing late if you’re owed a refund, but if you owe – you’ll be charged interest and late payment penalty charges if you can’t pay your bill.
Let us help you with your tax debt…
Even if you’re filing your taxes late, it doesn’t mean you have to deal with your tax debt late. If you know you owe CRA money, let’s chat about your options and put a plan into place right away. Avoid consequences such as a CRA wage garnishment or the loss of future tax refunds and credits (GST/HST). Regardless of the debt-free plan you choose, don’t wait to deal with your debt. You owe it to yourself to live a debt-free lifestyle and that includes freedom from tax debt. Once you’ve obtained a fresh start, we’ll show you how to avoid new tax debt in the future. Discover how great it feels to become debt-free. Please call 1-877-501-4321 or book online and schedule your FREE consultation today.