2013 Income Tax Checklist

It’s never too late to start planning so I’ve attached GET YOUR TAX TOGETHER_checklist2013 to help plan for the upcoming tax season.  This checklist will give you a start on what documents are important, and what changes you should mention to your accountant.

Now would also be a good time to start compiling information to see if you should be investing in RRSPs before the March 3, 2014 deadline.  Saving into a Registered Retirement Savings Plan may not be your best answer, so it is always important to talk with a professional financial planner.

And, on a cautionary note:  I have seen a number of penalties being assessed by the CRA for people that failed to report income on a T4, T4A, or T5 slip.  This penalty is quite severe –10% federal and 10% provincial on the gross income not reported — and is implied regardless of whether there are taxes owing.  So, if you think that you should have gotten a slip, but you have moved, or they didn’t have your mailing address, or a host of other daily things that could result in having your slip not given to you — then contact the employer/source and get a copy. Or, if that is not possible, estimate the amount and claim it as a slip on your tax return.

So, once again…IT DOESN’T MATTER IF YOU WILL HAVE NO TAX OWING. They will impose a 20% penalty on the gross earning amount. For example, you started a job and worked for a week and earned $500.  If you don’t claim the slip, they will assess a $100 penalty.   Will CRA know if you miss a slip?  Yes.  Is it fair that they assess a penalty rather than simply adjust for the honest mistake?  No.  Do they care that it isn’t fair?  Apparently not.

If you need any help, or clarification, please don’t hesitate to call. We make tax less taxing.