At tax time, some of us may be excited to file an income tax and benefit return to receive a refund or benefit and credit payments. On the other hand, some of us may feel overwhelmed by the tax-filing process. At Ascencio Tax Inc. we understand, and we’re here to help.
Here’s a list of some of the most common mistakes we see at tax time. Avoiding these can save you time and help make the tax-filing process as simple as possible.
Not reporting all your income
Some sources of income might not even cross your mind as something you need to report on your tax return. Here are a few examples that you might not have been aware of, but need to report:
tips and gratuities
income from sales of goods or services if you are carrying on a business (such as side jobs)
income from the platform economy, which includes ridesharing, accommodation sharing, gigs, peer-to-peer sales, and social media activities using digital platforms
income from online business activities
foreign income (including interest and other income from investments held outside Canada)
Not keeping personal information up to date
If your personal information, like your address, phone number, children in your care, or marital status has changed recently, tell us right away. We’ll ensure you receive the correct benefits and credits and avoid payment delays.
Claiming personal expenses
If eligible, you can claim deductions, credits, and expenses to reduce the amount of tax you need to pay. However, you should keep in mind that not every expense can be claimed. Examples of expenses you can’t claim include:
funeral and wedding expenses
loans to family members
a loss on the sale of personal-use property (like a principal residence or a personal automobile)
Writing the amount of your partial payment on your paper return
Do you file your tax return on paper? If you do, here’s a mistake you can avoid. If you’re only paying part of your balance owing, don’t write the amount you are paying on your paper tax return. The payment you send with your tax return will be counted as a payment towards your balance owing. It will show up as a “payment on filing” on your notice of assessment.
Remember, if you can only make a partial payment, you can set up a payment arrangement to pay the balance of your debt. A payment arrangement lets you make payments over time until you have paid your entire debt.
Not supporting income and expenses
Keeping good records helps you support your income and expenses. Reconciling your income with independent sources can help to ensure the accuracy of your records. Independent sources may include the following:
T4 slips
bank statements
statements of earnings from other sources
receipts from goods or service providers
The best way to avoid accidentally missing information on your return is to consult a tax professional or have someone you trust read over your documents. You can always find an Ascencio Tax Inc. office near you to have a Tax Expert help you with your return (in person or remotely).
Don't forget?
Avoid the most common tax filing mistakes getting help from Ascencio Tax Inc. Choose one of four convenient ways to file: File in an Office, Drop-off at an Office or contacting any of our Remote Tax Expert.
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