VANCOUVER, British Columbia, Feb. 25, 2019 (GLOBE NEWSWIRE) -- Tax season is officially here! You can file online as early as today. Here are seven tips that can help you get through the tax season smoothly:
Mark Your Calendar
The filing deadline for personal income tax and paying any taxes owed for the 2018 tax year is April 30, 2019. However, if you’re self-employed, the filing deadline for your (and your spouse or common-law partner) is June 15, 2019.
Be sure to pay any taxes owed on or before April 30 to avoid arrears interest charges.
Organize and Plan
- Create a filing system and keep physical paper trails even if you file electronically in case of an audit.
- Keep track of all your receipts as they come in to save you the hassle when you do your taxes.
- Remember to retain your records for at least six years in case of an audit!
Understand the Different Tax Slips
Know what your tax slips mean and how they relate to your tax filing. Some of the most common tax slips are:
- T4 slip: an information slip prepared and issued by your employer to tell you and the CRA how much employer income you’ve were paid and the amount of tax that was deducted in a tax year.
- T5 slip: an investment income slip that includes interest, dividends, and certain foreign income prepared and issued by a bank or a financial institution for you and the CRA.
- RC62: an information slip issued to you if you receive the Universal Child Care Benefit to reflect payments received.
- RRSP contribution receipt: a contribution receipt from your financial institution to indicate any contributions made.
Find out 2018 Tax Changes
For 2018, some of the key changes include the elimination of the employee home relocation loan deduction and the first-time donor’s super credit, as well as the expansion of eligible medical expenses to include expenses relating to service animals. Perhaps more importantly is the change on the tax on split income (TOSI) implemented in January 1, 2018, which allows TOSI to also be also be able to apply to amounts received by adult individuals from a related business. Seek the advice of a Chartered Professional Accountant for more information about TOSI as the implications can be complicated.
Put Money in your RRSP & TFSA
Beginning January 1, 2019, you can contribute up to $6,000 to your Tax-Free Savings Account (TFSA). If you’ve never contributed to a TFSA, your lifetime contribution is up to $63,500.
Avoid Common Tax Scams
Watch out for these three common scams during the tax season:
- Phone Scams: don’t respond to unsolicited requests for personal information
- Phishing Communications: be aware of fake emails, text messages, or websites.
- Return Preparer Fraud: don’t trust tax preparers who may try to encourage refund fraud.
If you’re in doubt or unsure if you’ve been a victim of a tax scam, contact the CRA at 1-800-959-8281.
Hire a CPA
If you need help with preparing and filing your return, consider hiring a CPA. If you plan to do your taxes yourself, be sure to visit CPABC’s RRSP and Tax Tips at rrspandtaxtips.com for our tips for the 2018 tax year.
NOTE TO JOURNALISTS: CPAs are available for interview. Accompanying infographic can be found here.
Please credit Chartered Professional Accountants of British Columbia (CPABC) for use of the content and include the following disclaimer: Tax rules relating to these RRSP tips are complex. This is not intended as tax advice, and you should not make tax decisions based solely on the information presented in these tips. You should seek the advice of a chartered professional accountant before implementing a tax plan or taking a tax filing position.
About CPA British Columbia
The Chartered Professional Accountants of British Columbia (CPABC) is the training, governing, and regulatory body for over 36,000 CPA members and 5,000 CPA students and candidates. CPABC carries out its primary mission to protect the public by enforcing the highest professional and ethical standards and contributing to the advancement of public policy. CPAs are recognized internationally for bringing superior financial expertise, strategic thinking, business insight, and leadership to organizations.