Tax season is upon us and with the deadline just around the corner, Global News has rounded up all the “need to know” information to help ease the tax filing process:
What is the deadline for filing my taxes?
April 30 — if you have a balance owing. The regular filing deadline is April 30, but since that falls on a Sunday this year, the CRA will consider your taxes filed on time as long as they are received or postmarked on or before May 1.
June 15 — If you or your spouse or common-law partner ran a business in 2016. But you still have to pay your taxes by April 30 if you owe money to the government.
How are taxes calculated?
Taxes are based on how much money you make during the year.
You can make various deductions that reduce the amount of income you have to pay taxes on.
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First, you declare the total, or gross income you made throughout the year, according to TurboTax, a tax-filing software company.
That can include employment income, as well as any money you made from your own business, investments, interest, capital gains and dividends, according to Revenu Québec.
Certain tax credits can reduce the amount of income you have to pay tax on.
Federal tax is calculated on whatever income is left after deductions.
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What are the tax brackets?
The income tax rates for the 2016 taxation year are determined on the basis of your taxable income:
- 15% on the first $45,916 of taxable income
- 20.5% on the next $45,915 of taxable income (on the portion of taxable income over $45,916 up to $91,831)
- 26% on the next $50,522 of taxable income (on the portion of taxable income over $91,831 up to $142,353)
- 29% on the next $60,447 of taxable income (on the portion of taxable income over $142,353 up to $202,800)
- 33% of taxable income over $202,800.
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What is the deadline to contribute to my RRSP?
There is no deadline to contribute to your RRSP. But if you wanted to claim your contribution as a tax deduction against your 2016 income, it’s too late, unfortunately. You had to make your contribution by March 1.
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What do you need before filing your taxes?
There a multiple forms you will need, depending how you earned your money:
- RL1: Also known as a T4, shows salary earned by an employee. It is filed by an employer and can include wages, tips, fees, scholarships, commissions or other amounts. This slip is only available in French in Quebec.
- T4A: If you are retired and collect Old Age Security from the federal government, you will receive a T4A(OAS) slip.
- RL-5: If you received worker’s compensation or social assistance.
- T4E: If you received employment insurance or other benefits.
- RL6: If you received parental or maternity benefits.
Revenu Quebec says all slips needed to file your tax returns should have been received by late February, but the R15 and R16 will only be received by early March.
The issuer of each slip is required to send your individual slip.
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Documents you need for your tax deductions and tax credits
What receipts do you need?
You can claim public transit, child care, moving expenses (if you have to move to get a job) and medical expenses, but you must provide receipts.
Public transit receipts should be kept to claim a credit for your transit passes.
What do I need to obtain tax credits for children’s activities?
You are eligible to receive a refundable tax credit if you enroll your child in a “physical activity, cultural or recreational activity.”
There are certain conditions that need to be met and you must be a Quebec resident before Dec. 31, 2016.
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One of the parents of the child must enroll them in a program or an activity that is outside the school curriculum.
These extracurricular activities can range from physical activity, artistic crafts and cultural and recreational activities.
They must span at least eight consecutive weeks or five consecutive days, such as a summer camp.
The net family income cannot exceed $134,095.
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Tax credits and deductions to advantage of
RenoVert is a refundable tax credit that is in place temporarily to encourage investment into eco-friendly home renovations.
To claim the tax credit, construction must have been completed before Jan. 1, 2016 and the renovation work must have been done by a qualified contractor.
The house must be qualified as an eligible dwelling and you can receive up to a maximum tax credit of $10,000.
You can claim a tax credit for donations that you have made throughout the year.
The donations must have been made in 2016 and you cannot claim those made in the previous year.
The donations must be given to a recognized and registered charity or political party and all your donations must be of monetary value.
You can claim certain moving expenses if you moved during the 2016 fiscal year.
You can only receive the credit if you moved 40 kilometres or more to be closer to a new job.
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Common mistakes
If you file your taxes online, you do not need to send your paper tax returns to Revenu Québec.
If you catch an error
If you happen to find an error in your tax returns after you have sent them in, do not resend your file.
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Simply wait for your notice of assessment and correct the changes on the Canada Revenue Agency’s website.
You can make adjustments to your tax returns as far back as 10 calendar years.
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