It’s that time of year again when most Canadians dread thinking about submitting a tax return. While missing deductions and credits is one of the most common issues for any Canadian, taxes may be considerably more complicated for immigrants. We have refuted four common myths about filing taxes among immigrants.
Myth No. 1: You don’t need to submit a tax return since You haven’t started earning money in Canada.
“If you’re 19 or older, it’s always a good idea to submit an income tax return, even if you have no tax liability to pay,” says Kevin Yip, a certified general accountant in Vancouver. The GST/HST tax credit (a tax-free quarterly payment to assist low-income taxpayers) is one of the many social benefits provided by the Canadian government to income tax filers including child tax benefits for children under the age of 18 student tuition credits that can be applied to lower future taxes or transferred to their parents’ taxes (up to $5,000) the GST/HST tax credit (a tax-free quarterly payment to help low-income families and individuals offset part of the GST they pay). Even if you have no income to report, failing to file a tax return means foregoing these and other advantages.
Myth no. 2: You have to hire a professional accountant to file my tax return.
Tax software tools for do-it-yourselfers are simple to use and provide step-by-step directions for finishing your return. They’re a terrific choice for people who have uncomplicated tax returns or want to save money. However, newcomers should seek assistance on their first return to ensure they don’t lose out on any applicable credits or deductions, according to Yip.
Myth no. 3: If you moved to Canada within the calendar year, you have to claim income earned in your home country from the first of the year.
You will not be taxed on income earned before you arrived in Canada,” explains Yip. If you arrived in Canada in June 2013, you just have to claim the income you earned from that date forward. If you still have a bank account in your home country, you must record the interest on your Canadian tax return from the day you arrived. Similarly, if you have a property in another nation that you rent out, you must record the rental income.
Myth no. 4: You have until April 30 to file your tax return, so you will do it on April 29.
Procrastination might cost you a lot of money. Examine your employer’s pay stubs with plenty of time to spare to ensure you have everything you need to file. Failure to submit a missing income slip might result in a penalty of up to ten per cent of the income you failed to declare.
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