As tax season is underway, experts are reminding people of possible tax credits and warning Canadians to file their taxes early as a potential strike looms for Canada Revenue Agency workers.
Tax season in Canada kicked off last week when the CRA portal opened on Feb. 20 to file. Canadians have until May 1 this year, as April 30 falls on a Sunday.
Those with self-employment income have a later deadline of June 15 unless they owe money, in which case the deadline is still May 1.
Crystal Volpe, president of London-based C & V Income, says far too many people wait until the deadline to file their taxes.
“Last year in the last two weeks of tax season, 33 per cent of Canadians had still not filed their tax return,” Volpe told Global News.
“So not only does that put an incredible demand on CRA and their system, but also on anyone in the industry.”
The demands on the CRA could get even more complicated as strike votes are ongoing. Last month, the Public Service Alliance of Canada and the Union of Taxation Employees launched nationwide strike votes for more than 35,000 CRA employees.
The strike votes come after negotiations over wages and remote work broke down; they have been without a contract for over a year. The votes began on Jan. 31 and are happening until April 7, in the heart of tax season.
With the possibility of a strike by CRA employees, Volpe says it is best to get taxes submitted electronically before April 7.
“They are recommending that people file before April 7 because there are absolutely going to be delay,” Volpe said.
Volpe says if there is a strike, people should not expect a deadline extension beyond May 1 to file their tax returns.
The lack of people working in the event of a strike means there will be nobody to answer the phone and all returns filed by paper after the strike begins will only be marked as received by not processed “until far after the strike because of the backlog,” says Volpe, adding there is already a six-month backlog.
Along with expediting the process, Volpe also recommends submitting tax returns online as it is more secure than paper.
Tax credits
The most notable new tax credit available that Volpe says people are mostly unaware of is the “staycation” tax credit. The temporary credit allows Ontario residents to claim a portion of their accommodation expenses for staying at a hotel, cottage or camping ground in Ontario last year.
“There’s so many times that people leave money on the table by just not knowing what has happened with their tax return,” Volpe said.
Volpe added she recommends people register with CRA online to see updated info as it becomes available.
Other changes included two major benefits for homeowners that have been doubled for the 2022 tax year.
The first-time homebuyer’s tax credit is now worth $10,000 for those who purchased a home after 2021, up from the previous $5,000.
The annual expense limit for the home accessibility tax credit, which allows seniors and homeowners with a disability to offset costs put towards making their residences more accessible, is also now doubled to $20,000.
— with files from Global’s Craig Lord and Aaron D’Andrea