Dale Jackson

Personal Finance Columnist, Payback Time

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The deadline for most Canadians to file their 2023 income tax is Tuesday, April 30.

If you haven’t started yet, take a deep breath. There’s plenty of time, but there are consequences for snubbing the Canada Revenue Agency (CRA). 

Anyone who earned income in 2023 must file by the deadline. If you file late and owe the CRA money, the penalty is ten per cent of the unpaid tax from the deadline, plus two per cent each month for up to 20 months. From there, the penalties increase. 

If you miss the deadline and the CRA owes you money, it could take longer to receive your refund.

For a few people, the 2023 tax year brought changes relating to reporting requirements for trusts and crypto-assets that might be best left to tax pros.

For most of us, it’s business as usual. To help avoid a panic, here are some last-minute tax filing tips: 

1. File on time even if you can’t pay your tax bill. The rules say April 30 is the deadline regardless of who owes who, what. The CRA wants to know what you’re up to and filing tells them you are aware of the situation.
2. File a tax return even if you don’t think you have to. There are many reasons why you must file a tax return but benefits like the Canada Child Benefit, Guaranteed Income Supplement (GIS) and the GST/HST tax credit, are based on your tax return and you can only qualify if you file a return. Also, you might have a refund coming your way if your earnings were such that you overpaid with your tax withholdings from your pay cheque. This often happens with students; especially with tuition tax credits.
3. Make sure that you are maximizing all of the allowable deductions and tax credits available to you based on your personal situation. This includes registered retirement savings plan (RRSP) and first home savings account (FHSA) contributions, childcare deductions, or medical and tuition non-refundable tax credits.  
4. Medical expenses, for example, can span any 12-month period as long as it ends in the tax year. Depending upon your situation in 2023, or even the current year, you can plan your claim accordingly to maximize your return.
5. If you have children attending an eligible education institution, such as a college or university, remind them to log into their student account at their school and download their T2202 forms. Even if they are not earning money now, they must file their return to declare tuition expenses. They can either carry forward the unused amounts to another tax year or transfer up to $5,000 to their parents, or even grandparents.
6. Make sure you have your direct deposit information on your CRA My Account so you can get your refunds and any other paid benefits quickly.  If you don’t have a CRA My Account, sign up. It also helps when trying to coordinate Canada Pension Plan (CPP) and Old Age Security (OAS) income in retirement.
7. If you are self-employed the CRA requires a T2125 Statement of Business or Professional Activities, which includes a tally of total income generated from the business. If you work from home don’t forget to deduct your business use-of-home expenses. You can also claim work-related vehicle expenses. Remember to maintain a mileage log to validate the use.
8. If you file your return and realize you’ve made a mistake, don’t panic. The CRA allows for adjustments on returns, which can be done through your CRA My Account under “Change My Return” or using a refile option on your tax software if it is available. You can also complete the T1-ADJ request form and mail it in, but you need to wait until you get your notice of assessment first.