Feb Update Arbutus Tax News

The tax season is now going with Efiling having commenced Feb 20th for the 2016 tax year right back to 2013.  For some reason they dropped Efiling for 2012 and that along with prior years now must be paper filed, which we can do, of course.

 

Thanks to all our clients for continuing to support Arbutus Tax Services, a local small business in Victoria.

 

With each tax year, there are changes to be aware of.

 

One of the changes is the new rules concerning sale of residence:  http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/rprtng-ncm/lns101-170/127/rsdnc/menu-eng.html  Check this link for more details.

 

For 2016 you must indicate on the tax return if you have sold or not.  “When you sell your home, you may realize a capital gain. If the property was your principal residence for every year you owned it, you do not have to report the sale on your income tax and benefit return.” But there are special situations such as having rented the property or used it for business income.

 

A change of address is possible when the current tax return is filed.  Make sure that everything is updated including change in marital status and dependents.

 

Yes, you may be able to do your own tax return.  There are software programs for this or you can still paper file. But it can be a challenge to keep up with the changes and also doing it only once a year can have some drawbacks. Knowing all the rules or most of them can be a challenge and sometimes meaningful friends can be helpful or not.  Smile 

 

I have seen quite a few errors being made and have helped with fixing these, but I am sure others have had no issues.  Missing something can be costly as you may be able to save with deductions or credits and have to pay more tax than necessary or face penalties for not reporting something.

 

CRA advises to be careful in not claiming things your are not entitled to, also continuous business losses can result in reassessment and disallowing those losses.   

 

You can also register online to check your details and manage your account with Canada Revenue Agency, CRA : http://www.cra-arc.gc.ca/esrvc-srvce/tx/ndvdls/myccnt/menu-eng.html   There is much information to be had there.

 

For many of our clients having completed the form T1013, Authorizing or Cancelling a Representative, gives us access to your account at CRA.  This allows us to complete a return based upon the information on file at CRA.  It is also important to note, not all forms may have been registered yet at the CRA, such as T4s, T3s, T5s, T4RIFs, T4RSPs etc. Other things have to be done manually such as donations, medical expenses, employment expenses and if a small business T2125 must be completed.

 

Some forms are not out until the end of Feb or March.  Investments take longer T3s and if you have sold securities get a statement from you investment company which show sales and purchases, usually a Statement of Realized Gains or Losses.  I am finding more of the T5008 forms being reported by the financial institutions and the client not being aware.  If in doubt ask your financial adviser or institution.  This is very important for accurate reporting to avoid missing reporting this and getting penalties and interest.  For losses you can carry them forward or back. This applies to securities held outside RRSP or TFSA.   

 

For existing clients, we can have most of your return ahead of time also to save time to complete the return and saving you from running back and forth. 

 

Some family credits to be aware of are here: http://www.cra-arc.gc.ca/nwsrm/txtps/2017/tt170214-eng.html

 

First time home buyers may take advantage of t $5000 credit and we assist with this.  Just let us know and we will check this out.

 

It is important to file on time and we suggest doing this as early as possible to avoid the rush and to avoid penalties and interest. 

 

If you want to have the CRA email you for notices and assessments that can be done by providing your email address before Efiling.  However this means signing up at MyAccount on the CRA website and you will need a password.   Register above at the MyAccount link. 

NOTE: By doing so you will NOT receive paper notices and must check your account online for future notices.

 

Keep all receipts and slips for at least 6 years.  For medical receipts if you have many, ask your pharmacy for a printout of the receipt totals for the year.  That will save time and money. 

 

Pension splitting is sometimes missed by seniors filling out their own forms so make sure this gets claimed.  We will do this automatically for the optimized amount.  This can save thousands of dollars.

 

If you have questions please give us a call at 250-999-8585. Also email us, see our contact link on the main page.  It is sometimes quicker by email rather than playing telephone tab.  Smile

 

Okay that is it for now.  I have not covered everything for sure.

 

Cheers

 

Eugene Veinotte

Arbutus Tax Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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