April Tax Tips

0
546
canadian money  e
Allange / Pixabay

If you have not filed your taxes yet, here are some tips to get you there:

  1. File your taxes on time (due April 30th or June 17th if self-employed) to avoid harsh late-filing penalties! File even if you cannot pay.
  2. Taxes are due April 30th (or earlier if CRA asked for 2018 instalments). So, it is better to estimate your taxable income as early as possible to minimize tax interest.
  3. File your taxes to get benefits that are yours (such as Canada Child Benefit, GST, Guaranteed Income Supplement, and Working Income Tax Benefits) and to avoid CRA withholding your refunds!
  4. 2018 income tax brackets for Albertans:

Taxable Income                      Marginal Tax Rate                                                         

First $11,809                           0%

$11,810 to $18,915                 15%

$19,916 to $46,605                 25%

$46,606 to $93,208                 30.5%

$93,209 to $128,145               36%

$128,146 to $144,489             38%

$144,490 and up                     41% to 48%

In Canada, the more money you make, the more taxes you have to pay. If you are in a higher tax bracket, you can use certain deductions (RRSP/Flow-through shares, for example) to bring your income to a lower preferred tax bracket.

  1. If you already filed your taxes and got your refund, you can:
  • pay down debt with the highest interest rate (thus, more money in your pockets)
  • buy TFSA (could be your emergency or vacation fund),
  • buy RRSP (tax deduction for 2019),
  • buy RESP (free government grants for your kids’ education),
  • donate to your favorite registered charity and get tax credits, and/or
  • buy something nice because it was a good tax planned year!
  1. Keep your records for 7 years, should CRA want them.
  2. When in doubt, go to a tax professional.

May your taxes be done on time and done right!

Ka-Yee Wong, CPA, CA