We often receive the same tax related questions from clients and often advise on the same common tax misconceptions. Here are a few of the most reoccurring examples
I did not earn money in Canada during the tax year so do not need to file a return?
Technically speaking if you are a Canadian tax resident and did not have any income during the tax year from any source around the world, then you are not required to file a tax return. However, it is very probable if you fail to file a return for a tax year that CRA will be in contact in the future requesting you to file that return. If CRA request that you file a tax return, you will be required to file the tax return.
Even if you did not have any income within Canada during the tax year you may be entitled to a small tax refund when filing. British Columbia Residents are issued with a $75 tax credit even if they have zero income to declare, to it does pay to file your return.
What are the dates of the tax year in Canada?
We file tax returns for quite a lot of temporary foreign workers, many of whom come from countries which have varying tax year dates. In Canada the tax year run from January 1 – December 31 which is quite easy to remember!
I missed the tax deadline, is it too late to file my taxes?
It appears there must be some ‘fake news’ online among Vancouver facebook groups which has led a lot of individuals to believe that if they miss the April 30 deadline to file taxes they must wait until the next tax year to file their taxes. Fortunately, this is not true! If you are late to filing your tax return and miss the April 30 deadline you can still file your tax return. It is also advised that you do file your tax return as soon as possible, if for some reason you owe money to CRA the sooner you settle the tax balance owing with CRA the less interest that will be added to that tax balance owing.
I have multiple tax years that need filing, can I file it all on one tax return?
Unfortunately, this is not possible Canada, we cannot speak for other countries. Although if enough people suggest this option to CRA maybe it could become a reality. For those who have multiple years which need filing it can often be a pain tracking down all the income and expense information from many years ago. As painful as tax filing can be, it is advised to file your taxes as soon as possible.
I arrived in Canada towards the end of the year so need to file a tax return as a non-resident?
We receive a lot of questions from first time tax filers who are new to Canada and are unsure of their tax residency. One misconception is that if you have arrived in Canada towards the end of the tax year, and resided in Canada for less than 6 months by the end of the tax year that you must be filed as a ‘non-resident’. For the most part, this is untrue. If you arrived in December, and are planning on residing in Canada for longer than 6 months you would file your tax return as a newcomer tax resident even though you would have only been residing in Canada for a month by the end of the tax year.
Do you have any tax related questions or concerns?
If you have any questions, queries or have been provided with some tax advice that does not seem correct, please do not hesitate to get in contact with the team at firstname.lastname@example.org or visit our Vancouver office* and we can help you navigate the complicated world of tax. Tax doesn’t have to be taxing!
*At the time of publishing our Vancouver office is not open for visits due to COVID-19. Please reach our team via email – email@example.com