Prepping for tax season
It happens right around this time every year. The mad panic to gather receipts, figure out expenses and actually track where our money’s been going (can you say Starbucks app reload?). And while tax season inevitably comes every April, it somehow has a way of sneaking up on us. Don’t fret – we have a few tips to help get you organized and filed on time (without freaking out).
Tip #1: Gather more than just your T4
This is the time to check that junk drawer, dig through your wallet and sort out the pile of paper on your desk. Your T4 slips are just the tip of the iceberg when it comes to gathering receipts. Think Child Care Benefits, RRSP contributions, union dues and even student loans. Check out this handy list from H&R Block for a breakdown of exactly what you need to make sure you get every tax credit you’re entitled to. Here’s another tip: keep all things tax-related in one place!
Tip #2: Figure out what forms you’ll need
Everyone’s financial situation is different, and whether you’re self-employed or work for a company determines the way you file your taxes. (Psst… did you know a good rule of thumb for a self-employed person is to set aside 25% of income earned for taxes?) And there are different forms for different types of employment, so it’s a good idea to familiarize yourself with what you’ll need – and what you can no longer claim. This report by Global News is a great resource for not only the forms you’ll need (caution: it’s a bit overwhelming) but also when the deadline is (April 30th) and even new ways to file.
Tip #3: Take advantage of technology
What ever did we do before computers? With so much CRA-approved technology out there, it’s easier than ever to sort out and file your own taxes online. But new technology can be intimidating, so do yourself a favour and take some time to acquaint yourself before the deadline comes and goes. It’ll be a lot less stressful if you know what to expect.
Tip #4: Know when not to DIY
Let’s be honest, there’s nothing fun about tax time. So, if you’re feeling overwhelmed by it all or your situation is more complicated than most, take advantage of the expertise of an accountant. They’ll work on your behalf to make sure everything is accurate and in order – and all you have to do is sign on a few lines. Keep in mind it can be costly, but it may be worthwhile for the sake of your sanity. Read this post from Best Health magazine for a firsthand account of why one person chose to seek professional (accounting) help.
Tip #5: There’s always next year!
No matter how good our intentions are, the days can get away from us and taxes may slip to the backburner. Here’s the thing: you’ve got twelve months to get yourself organized to do it all over again.