Canadian Personal Tax Return: T1 General Income Tax and benefit Return You have to file a tax return in Canada if you owe taxes. A non-resident of Canada may have taxes payable under section 115 in Part I of the Act on taxable income earned in Canada.
You should also file your tax return if you are getting a tax refund.
Generally, you need to file T1 by April 30th
If you or your spouse have a business, then your T1 is due by June 15th
CRA may stop paying you your trillium benefits, climate action incentives, GST/HST credit, child tax benefit if you do not file your tax return.
Whether you are self-employed or an individual, partnering with a professional team is beneficial to you and your business. By the end, you only have some time to rely on the expertise and awareness of your tax partner who will solve many of your tax issues, virtually available to help all over Canada and physically located in Woodbridge, Vaughan.
RKB’s expertise has helped clients in getting thousands of $ as income tax refunded, which included refunds from those prior years, which CRA normally does not allow to adjust your returns.
Your income may include all of your salaries and wages reported on your T4.
Employment benefits provided by your employer.
Other employment income such as research grants, royalties, employee profit-sharing plans, and the likes.
Foreign employment income.
Commission revenue for salesperson, insurance agents, mortgage agents, and financial planners…
Before filing your tax returns, we will specifically review and ask you questions on the following:
RRSP room and contribution, directly deductible from your income
Tuition fees, Membership fees, Union dues, Training expenses
Donations, gifts, and medical expenses to maximize your credits
T2200 Declaration of conditions of employment in order to claim your employment-related expenses to maximize your deductions
Rent or Property taxes paid to maximize your trillium benefits
Pension splitting to optimize income threshold
Foreign properties to be compliant and avoid penalties
And lots more…..
You report your self-employment income on Form T2125, Statement of Business or Professional Activities. As defined by the Canadian Income tax act, “A business is an activity that you intend to carry on for profit, and there is evidence to support that intention. A business includes a profession, calling, trade, manufacturing, or an undertaking of any kind.”
You need to report your business income or losses using the accrual method of accounting.
Commission agents may use the cash method.
You can deduct costs of sales, operating expenses, and amortization from your reported income.
Bad debts adjustments
You pay taxes on your net business income.
Your business loss can be deducted from your other sources of income.
If you are carrying more than one business then you have to report each net business income separately.
You must properly keep a daily record of your receipts and expenses.
Definition of income and allowable expenses in tax laws can be complicated; however, correctly presented to CRA in your favor can reduce your tax liability or substantially maximize your refunds.
We invest time in understanding your business to serve you better. A detailed understanding allows us to maximize tax-deductible expenses. These are what we specifically pay attention to:
Your requirement for GST/HST registration
The requirement to register your GST/HST with Revenue Quebec
Home office expenses
Expenses that you have paid from your personal account
Your business startup costs
Transfer of your personal assets into a business
Bookkeeping and record retention
You report your rental income on Form T776, Statement of Real Estate Rentals.
The number and types of services you render to your tenants will depend on whether you have rental income from the property or your business income.
Generally, this is an income from your property if you rent space and provide only basic services such as heat, light, parking, and laundry facilities.
You may be carrying on a business if you are providing additional services to tenants, such as security, cleaning, and meals.
You need to report rental income if you are renting your house, rooms, space in an office or other real or movable property
You can deduct costs of maintaining and operating the property and amortization
Bad debts adjustments
You pay taxes on your net income
Rental income from each property is to be reported separately
You should keep a day-to-day record of your receipts and expenses
You need to report the rental income that was earned from January 1 to December 31 in the calendar year.
Generally, the accrual method is being used to calculate your rental income, and:
report rental income in the calendar year you earn, though you may have not received it in the calendar year
deduct expenses in the calendar year you incur, though you may have not paid it in the calendar year
Incur usually means you’ve either paid or will have to pay the expense.
The good news, the following amounts are not taxable, and you do not need to report on your income tax return.
The money you have won from the lottery is not taxable.
Most gifts and inheritances you have received in cash or kind from your friends and family are non-taxable income.
Amounts received from a life insurance policy coverage following a persons’ death is mostly not taxable.
If you are receiving any type of strike pay from your union, even though you perform striking duties as a requirement of membership these are your non-taxable income.
Canada child benefit (CCB) and GST/HST credit either federal or provincial are non-taxable income.
If you are in Quebec and receiving family allowance payments and the supplement for handicapped children, these amounts will not fall under your taxable income.
If you have received any amount either from Canada or an allied country (if the amount isn’t always taxable in that country) for incapacity, disabilities, and any death of war, then it is non-taxable income.
If you were a victim of a motor vehicle accident OR OF a criminal act and you are receiving compensation from a province or territory, then it is non-taxable income.
Note: If you earn any interest on the above amounts, that is your taxable income.
If you are earning any amount from a tax-free bank account (TFSA), then mostly it is not taxable.
International and non-resident taxes in Canada
Your income tax obligations in Canada are based on your residency status under Canada’s tax system. You need to determine your residency status in Canada to know your filing obligations and tax responsibilities in Canada.
Your residency status is to be determined on the basis and the individual’s whole situation, as well as the relevant facts, must be considered.
As a non-resident of Canada, you must pay tax on income that you receive from Canadian sources.
The requirement to file an income tax return and the type of tax you pay depends on the heads of income you receive. Generally, Canadian income received by a non-resident is subject to Part XIII tax or Part I tax.
You must withhold and remit an amount in accordance with the requirements under both general income tax and the Canadian Income Tax Act if you make a payment of commissions, fees, or other amounts to a non-resident person for services provided in Canada
Deemed resident taxes in Canada
You will be considered as a deemed resident of Canada for tax purposes:
If you do not have significant ties with Canada,
In the tax year you stayed in Canada for 183 days or more, and
You are not considered a resident of another country under the terms of a tax treaty between Canada and that country.
Your tax obligations
You must report your world income
All deductions and non-refundable tax credits may be asserted as applicable
You will pay a federal tax instead of the provincial or territorial tax
You will be subject to a federal surtax
You cannot claim provincial or territorial tax credits
You may apply for (GST/HST) credit
You may also be eligible to receive the Canada child benefit (CCB). All you have to do is to file a return each year to enable your CCB to be calculated by the Canada Revenue Agency (CRA).
Our Services Includes:
We will do a quick review of your last filed tax return and advise you if you have missed anything and based on the cost-benefit analysis guide if we need to revise your returns
We will obtain your authorization and check with CRA to ensure the account is up to date
You will have our robust and comprehensive inquiry and review system
We will ensure that every deduction, exemptions, and tax treaty benefit that you are entitled to captured on your tax return including Canadian workers benefit, pension income split, foreign tuition fees, membership fees
We will prepare and provide your draft tax return for your review and will explain all your queries that you may have
Electronically filing your tax returns with CRA
Follow up for the correct assessment of your tax return
Our relationship does not end at the assessment of your tax return. We are here to answer all your questions at any time and work with you to plan your taxation for the next year.
We are an Authorized CRA e-file provider and file your tax return electronically for better processing and faster refund. We file both general income tax and the Canadian personal income taxes in Quebec and Ontario for all of our clients.
We provide services for personal and business tax filing in Woodbridge, Vaughan, North York, Toronto, Richmond Hill, Scarborough, North York, Mississauga, Oakville, Hamilton, Brampton, all over Ontario and Quebec.
About Our Company
We make worry-free accounting for you through flexible availability, professional guidance, and over 25 years of industry expertise.
61-130 Bass Pro Mills Drive, Suite 203, Concord, ON L4K 5X2
200- 55 Village Centre Place, Mississauga ON L4Z 1V9 (By appointment only)