I am presuming your taxes come out of your wage every month like they do in UK, so why do you need to do a tax return every year?

Have I misunderstood?

This may help:

http://www.cra-arc.gc.ca/tx/ndvdls/t.../menu-eng.html

Because you do. In England, if you are employed, the Tax man assumes that your employer has deducted tax correctly and, as very few things are tax deductible, there is very little need for each individual to file a tax return. However, you are still responsible for paying the correct tax and if, like me, your employer cocks things up, you are still responsible for paying any tax owing.

Canada requires everybody to file a tax return each year (similar to what self-employed and others have to do in England). There are a plethora of items that can be deducted and, if you want to, you can deliberately over pay your taxes each month so as to ensure that you receive a refund each year. Whilst this is a interest free loan that you are providing the Government with, some see it as a way of "saving" money that would otherwise be spent each month.

Canada is not England, it is Canada. Many things are done differently over here (driving on the "wrong" side of the road for example).