Tax Season Best Practices
Tax season can be a stressful time for many individuals and businesses. However, with some preparation and organization, it doesn't have to be. Sean Ryan sat down with Caitlin Lawrence, CPA with The TaxForce, to discuss some best practices for tax season and provide tips to make the process smoother.
Collect all necessary slips
One of the most important things to do before filing your taxes is to collect all necessary slips. This includes donation slips, medical slips, and investment slips. By collecting these slips, you can ensure that you have all the necessary information to claim the deductions and credits that you are entitled to.
Keep track of your expenses and donations throughout the year
To make tax season easier, it is recommended to keep track of your expenses and donations throughout the year. This way, you won't miss any important information when filing your taxes. Keeping a record of your expenses can also help you identify potential deductions and credits that you may be eligible for.
Be aware of new tax credits and deductions
Each year, new tax credits and deductions are introduced. For example, in Ontario, there is a staycation credit, digital subscription tax credit, and home accessibility credit. It is important to stay informed about these credits and deductions so that you can take advantage of them.
File your taxes on time
The deadline for employees to file their taxes is April 30th, and for businesses, it is June 15th. It is important to file your taxes on time to avoid potential penalties. If you are unable to file your taxes on time, you can file an extension, but it is still recommended to file as soon as possible.
Avoid waiting until the last minute to file your taxes
Waiting until the last minute to file your taxes can cause unnecessary stress and may result in potential penalties. It is best to start preparing for tax season well in advance so that you have ample time to collect all necessary information and file your taxes on time.
Consider using tax software or an accountant
Tax software or an accountant can help make the tax filing process smoother. Using software like TaxDome can help you keep track of your expenses and income throughout the year, while an accountant can provide expert advice and ensure that your taxes are filed correctly.
If you owe taxes, make sure to pay them on time
If you owe taxes, it is important to pay them on time to avoid late fees. If you are unable to pay your taxes in full, you may be able to arrange a payment plan with the Canada Revenue Agency (CRA).
Stay informed about changes to tax laws and regulations
Tax laws and regulations are constantly changing. It is important to stay informed about these changes so that you can adjust your tax strategy accordingly. The CRA website is a great resource for staying up-to-date on changes to tax laws and regulations.
Keep accurate records of your expenses and income
Keeping accurate records of your expenses and income throughout the year can make tax time easier. This includes keeping receipts and invoices for expenses and tracking your income. By keeping accurate records, you can ensure that you are claiming all the deductions and credits that you are entitled to.
Don't hesitate to ask for help
If you have questions or concerns about filing your taxes, don't hesitate to ask for help. A tax professional like Caitlin Lawrence can provide expert advice and ensure that your taxes are filed correctly. Seeking help from a professional can also help alleviate any stress or anxiety that you may be feeling about tax season.
In conclusion, tax season can be a stressful time, but with some preparation and organization, it doesn't have to be. By collecting all necessary slips, keeping track of your expenses and donations throughout the year, and staying informed about changes to tax laws and regulations, you can make tax time as stress-free as possible.
