Don’t make these mistakes when filing tax returnBy Andrew Rickard | March 07 2016 01:41PM
The Canada Revenue Agency (CRA) has published a list of the top five things to avoid when filing an income tax return.
First on the list is simply not filing a return at all because you had no income during the year. The CRA points out that even those without an income may still be eligible for things such as the GST or HST tax credit and the Canada child tax benefit.
Report all income
Next on the list is failing to report all of your income from your various tax slips. “You should have received most of your slips and receipts by the end of February,” says the CRA. “If you have not received, or have lost or misplaced a slip for the current year, you can ask your employer, or the issuer of the slip, for a copy.” It is also possible to use the CRA’s My Account service to gain access to electronic copies of some tax slips.
Penalties for late filers
Filing late is the third mistake to avoid. The CRA notes that late filers are charged a penalty equal to 5% of the 2015 balance owing on the due date, plus 1% of the balance owing for each full month the return is late, to a maximum of 12 months. “Even if you cannot pay your balance owing by the filing deadline, you can avoid the late-filing penalty by filing on time,” explains the CRA.
Missing out on new tax credits, benefits, and deductions is the fourth common error to avoid. The CRA encourages taxpayers to visit www.cra.gc.ca/getready to learn about new and existing tax measures that will help save them money.
Keep all records
The final error is failing to keep receipts and supporting records, which must be retained for at least six years after the taxes have been filed for a particular year. The CRA warns that, if it chooses to review your return, you will need to submit your receipts to support your claims.