Winston Green

Hi All

Am hoping to move to Canada this year and am after a little advice. Does eveybody working in Canada fill in a tax return or is it just self-employed workers.

Regards

Winston

Steve_P

Anyone who has an income of any kind is expected to file an income tax return. http://www.cra-arc.gc.ca/menu-e.html

Winston Green

Hi Steve

Does this mean that employees in Canada are paid gross or is tax deducted at source and the Tax return is just for conformation purposes?

regards

JonboyE

Yes. Tax and so on is deducted at source.

You are required to file a tax return if you have any tax owing, or the CRA ask you to do so. Otherwise filing is optional. If you don't file a return you won't get any refund owing, can't claim many tax credits, and will not be eligible for any means tested benefits like Child Benefit.

In practice, yes, you have to file a return each year. For an employee it is really easy, and you can buy software for $20-$30 that will do it all for you.

Winston Green

Cheers

It does not sound too taxing, pardon the pun. Do most people get a rebate I don't qualify for anything in the UK ( working, no kids, own house) and assumed it would be the same in canada. However if it is no drama and it's the norm I suppose I will go with the flow.

What is the basic rate of Government/Federal tax? I assume the provincial tax is different depending on the province you settle in and that goes on top to complete the burden.

Are there any other main taxes to be aware of?
I know about GST but it is the OH who is worried about that.

Cheers

JonboyE

It is quite common to get a rebate, but this all depends upon your personal circumstances and what you have done during the year.

An overview of the taxation system is here. Taxtips give detailed information of rates by province.

Souvenir

If only............

Steve_P

I get a refund every year.

But I'm an old pensioner on a limited income.

Gonna try income splitting this year and see if it gets us any more back.

Souvenir

Souvette already does income splitting. Half of my income goes to her. So does the other half.

BristolUK

There are sites that do it for free too - depending on income.

We've used one for three years and it retains everything input previously so all that's needed is overtyping for any changes.

JonboyE

I think quicktaxweb is free if your net income is less than than $24k.

BristolUK

Yep
Quicktaxweb is the one we use. But we did find another that was just as good.

lof

ufile has an online version too.

Cookie

We were thinking of hiring an accountant for our first tax return here just to make sure we maximise our returns.

Mr Y-C-D is employed by a company (started Jan 07), paid a monthly wage plus overtime, has all deductions removed monthly just like PAYE.

However, he also works from home and we get paid a small lump sum every month towards heating, lighting and use of space. We have some receipts for special workwear, subscriptions and some equipment he purchased. His work pays for stationary, other equipment, van.

I started working p/t and have hardly earned anything this past year (less than $3000. We have 2 kids aged 13 and 16. Have receipts for sports memberships.

Neither of us have paid extra into a private pension plan yet (only the standard one).

We are thinking of hiring an account just to make sure we are doing everything correctly this year. Next year we could buy software and do it ourselves.

Good idea or not ????

JonboyE

Yes, I think it is probably worth going to an accountant for the first year. (I know, I would say that wouldn't I?)

Of course, I'm sure you could do it yourself, but there are some little complications to sort out:

* are the lump sum payments included in your OH's T4?
* are some home costs (light, heat, insurance etc) allowable
* are his other expenses allowable?

Find a small, local firm (CA or CGA) and you shouldn't pay more than $100 for the two returns.