Tax filing season is around the corner. More Canadians have questions about how to file their taxes (amidst the pandemic) and, what to do about COVID-19 emergency funds?
We can help you make sense out of this pandemic-tax-season. Read on and learn how to make the most of your taxes and benefits returns.
Filing taxes
The procedure of filing taxes hasn’t changed much. However, this season paper tax returns will not be received and processed promptly. The CRA is facing site limitations and could take up to 12 weeks to issue your assessment.
We suggest that you go digital. Sign up to Direct Deposit and file your returns online. Also, sign up for My Account.
Last year, nine out of ten Canadians filed their tax and benefits returns online. The CRA processed more than $36 billion in tax refunds in the 2020 season. Without filing, you will never know if you owe no tax, owe tax, or are entitled to a refund.
Reach out to a tax specialist, and find out if you could be lined up for a refund this season.
What if you didn’t submit last year’s (or the previous years’) taxes? Expect some trouble accessing your profile on My account. But you can still reach out to a qualified accountant and get help.
What to do about the COVID-19 emergency funds
Last year, more than 27 million Canadians applied and received COVID-19 emergency funds. Did you apply for CERB, CESB, Canada Recovery Benefit (CRB), Canada Recovery Sickness Benefit (CRSB), or Canada Recovery Caregiving Benefit (CRCB)?
Make sure you include the total amount received in your return. All these are taxable benefits. You may owe tax, be entitled to a refund, or be clean.
Whatever the case, ensure that you file your taxes early. You could qualify for an interest waiver on any outstanding income tax debt for the 2020 tax year. Beneficiaries of the CRB, CRSB, and CRCB should also factor in the 10% tax withheld at source in their returns. Do not hesitate to reach out for help.
The best news is that there is no deadline for repayment of COVID-19 emergency benefits.
Make the most out of your tax and benefits returns this season. Go digital and get help to file correctly and on time.
Source: Canada Revenue Agency
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