Tag Archives: income tax

What’s New for Tax Time for Your 2015 Return Due April 2016 Including the New Auto-fill Return Software Feature

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Do We Still Get to “Income Split” For 2015 If We Are a Married Couple with Young Children?

Although this option will soon be gone, for the 2015 taxation year it is still possible for a married couple with children to receive a tax credit of up to $2000. You calculate your eligibility for this credit in the same way as for 2014.

How Can I Get My Tax Forms and Guides Without Leaving Home?

Don’t forget you don’t have to trudge to the post office to pick up your income tax guides and forms. Nor do you just have to wade through them online. You can order free mail delivery of any forms or guides from the CRA.

Go the CRA webpage at http://www.cra-arc.gc.ca/cgi-bin/puborder.cgi?lang=en and complete the Online Order form.

Although I use free tax filing software like GenuTax and StudioTax, I still like to have a paper copy of the guides and forms to review. I ordered my forms a week ago and they arrived today.

What Free Software Can I Download to Help Calculate and NETFILE my Tax Return?

I have used two of the free tax programs in past years. (Well, I send them a donation but I decide how much and they are small Canadian businesses not large impersonal corporations.) They are

  • StudioTax and
  • Genutax Standard.

StudioTax is now fully approved to file this year’s returns using NETFILE. You can download it to your computer from their website at http://studiotax.com/en/

Genutax Standard is still waiting on the CRA to issue their final approval but hope to receive it on March 2, 2016. When it’s approved, you’ll be able to download it from their website at http://genutax.ca/

As usual, I’ll be running some test scenarios this year to see if I like how the software is working.

In particular, I’ll be interested to see if they have taken advantage of a new CRA option where you can “preload” your forms with some information from your previous year’s tax returns.

New Way To Reduce Typing Old Tax Return (2014) Information Into Your New (2015) Tax Return in Spring of 2016

If you use a computer program to help complete your income tax return, you may be able to save yourself some typing this year.  The CRA has created a bridge to allow certified software to download your information from your previous year’s tax return into this year’s program. For example, it can download information about

  • Tuition and education credits you are carrying forward
  • Capital losses you are carrying forward
  • RRSP contributions you did not deduct yet

And so on.

It will also try to fill in your fields for forms containing information for this year’s tax return including tax slips such as your

  • T4 Income Statement from Employer
  • T4A Statement of Pension or Other Income
  • T4A(P) Statement of CPP Payments
  • T4RIF Statement of Retirement Income Fund Income
  • T5 Statement of Investment Income
  • RC62 Universal Child Care Benefit Statement
  • RC210 Working Income Tax Benefit Advance Payments Statement

You can read more details on the CRA website at: http://www.cra-arc.gc.ca/auto-fill/
Not all tax programs are capable of getting this information automatically. Check your program before you get your hopes up! (It looks like StudioTax may have this feature. If so, I’ll try a test of it.)

Also, be very very sure to review your tax return before filing it. It’s quite possible for a T5 or other important slip to be missing from the government’s website. It’s up to you to make sure you are declaring all of your income, not them. If you don’t declare it all, they can zing you with very harsh penalties and interest charges. Read it through very carefully before you NETFILE or mail it in!

Caution: Watch Out If You Provide Your Email Address!

Remember if you give the CRA your email address you are agreeing that they will stop mailing you your Notice of Assessment and other important letters. Instead, they will send you an email telling you to sign in to your online My Account profile to read these letters.

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Have you used the new auto-fill option with your tax software? What did you think? Please share your experiences with a comment.

What’s New for Tax Time for Your 2015 Return Due April 2016 If You Have Children?

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It’s that most horrible time of year again: tax time. I got my forms in the mail and took a peek at the T1-General Guide. I don’t usually look at car accidents but somehow I can’t help but look at the tax guide once I see it sitting on the table….Here’s what I found that’s new for a 2015 tax return for filers who have children.

Why Did I Get a RC62 Universal Child Care Benefit Statement in the Mail?

If your children were 6 or older but younger than 18 you may have received payments last year of the revised Universal Child Care Benefit.  It may have been quite a while since you last received any UCCB and you may have forgotten that it is taxable. Or at $60/month per eligible child aged 6-17, you might not even have noticed the money landing in your account.

Now, unfortunately, since the election is long past, we have to pay the taxes on that money.

That’s right, they didn’t withhold any taxes at source but the “benefit” is taxable income in the hands of the lower-earning parent.

So I will get to pay back about half of what we received.

There is also no longer any non-refundable tax credit for having a child of any age.

You report the amount you received, which is reported in Box 10 of your RC62, on line 117 of your return if you are the lower-net-income spouse or common-law partner.

What Happened to My Federal Non-refundable Tax Credit for My Children?

You used to claim $2 255 per child of the appropriate age on the Federal Tax Schedule 1 form on line 367. (By the time you finished the math, it was only 15% of that amount, or $338.25 per child.) If you are looking for it on the 2015 schedule, you won’t find it.

The problem with the non-refundable credit was that if a family was really low income, they weren’t paying any tax so they could not apply the credit to save any money.

Starting in 2015, the credit has been removed and instead all families get a taxable Universal Child Care Benefit. If the family is really low income, they will not have to pay any tax on this benefit and therefore it will help them. If a family has a moderate or high income, they will have to pay back some or a lot of this benefit both as federal income tax and as provincial income tax.

If your income was $75 000 a year before the $720 a year benefit for your one 7-year-old child, you will probably only get a benefit of $483 after tax in Ontario, based on using the Ernst and Young 2015 online personal tax calculator.

That’s about $145 more than the old non-refundable tax credit gave you. But it’s a lot less than the $720 that the advertisements were bleating about before the election!

If your income was $200 000  a year before the $720 a year benefit for your one 7-year-old child, you will probably only get a benefit of $346 after tax in Ontario, based on using the Ernst and Young 2015 online personal tax calculator. That’s very close to the old $338.25 per child that the non-refundable tax credit covered.

New Tax Form: The T4-A(P) for the CPP Children’s or Child’s Benefit

Many taxpayers have been dismayed to open envelopes this month and find a new tax slip: a T4-A(P) for their child or children’s benefit received from the CPP because one of the child’s parent’s has died. In previous years the government did not automatically send out this slip.

You can read what needs to be done with the slip by the parent, or child, over on Helpful Crooks.

Stay tuned for more exciting tax news!

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Does your mail box suddenly start overflowing around this time of year with tax slips? Did you get any new ones this year? Please share your experiences with a comment.