Tax Return FAQs For First-Time Tax Filers

 

Read on to learn all you need to know about tax returns if it’s your first time filing taxes.

 

Tax returns are documents submitted to the tax authorities such as the CRA. They show an individual’s or a business’s comprehensive financial position and include reports on wages, dividends, any other information deemed relevant by the tax authorities.

Tax returns help tax authorities calculate the accurate amount of tax liability which in turn affects tax credits and deductions. It is no secret that tax returns can be daunting if you are doing them for the first time. This article is going to help answer all the questions which you might have.

Here are a few FAQs you should know if you are filing your taxes for the first time:

How Should I File My Taxes?

This is the first question that may come to your mind. There are multiple ways you can file your taxes:

·         You leave it to a professional to handle your tax returns; firms like Accounting Plus Financial Services Inc provide cloud based accounting solutions Canada, tax planning Toronto, personal and corporate tax services Markham and other parts of Canada. You can reach them here.

·         Do it yourself with the help of a software application. The app will guide you through the tax filing process.

Where Should I File My Taxes?

You can take two different routes while filing your taxes.

1.      If you have filled in your tax return forms by hand on paper, you can mail them to the address given to you by the Canada Revenue Agency as per your location and residential status (whether you are a resident Canadian or a non-resident Canadian). 

These mailing addresses are mentioned on the CRA website. The drawback of filing by mail is that it is costly and will take longer to process.

2.      You can also file your tax returns electronically via the Internet. The Canada Revenue Agency has a detailed explanation of how to do so.

Can I Rectify A Mistake In My  Tax Return?

Yes, you can. If you have made an error in filing your tax returns, there are two ways through which you can rectify it.

1.      You take the online route. To correct your mistake through digital means, you can go to the CRA website and select the Change My Return option on the MyAccount page and request to make amends in your form.

 2.   You can fill out a form called  T1-ADJ and correct your tax return for any mistakes.

Are There Any Consequences If I File After The Deadline?

There might be many reasons due to which you won’t be able to file your taxes before the deadline. Despite the COVID-19 pandemic and a lockdown in major areas of Canada, the deadline was not extended.

Here's what you will lose if you file taxes late:

·         If you don’t have any taxes to pay, you should still file your taxes on time, or you'll face delays in getting child benefits and other allowances you have applied for.

·         If you do owe taxes and still did not meet the tax filing deadline, you will be charged a penalty for late filing by the CRA. This penalty will be 5% of last year’s tax balance in addition to further charges

It is better to do tax plannings and meet deadlines, and if you feel overwhelmed or perplexed because of the entire process, the best solution is to get help from a tax and accounting service, like Accounting Plus Financial Services Inc.

This is a better option than making mistakes in your forms and losing out on benefits because of missed deadlines.