Reasons to File Tax Returns
Part of being an adult is filing your tax returns. It goes a long way in portraying you as a financially responsible person. Most people dread the process of filing their income taxes. What they don’t know is that, it has so many advantages. In Canada, the deadline to file personal income taxes is on April 30th. Even self-employed individuals are required to pay any money they owe to the Canada Revenue Agency by this date to avoid penalties. Here are 5 good reasons to file your tax returns in Canada.
Get a refund
Most people will receive a refund after filing their tax returns. If you file but you end up owing money to the CRA, you can always pay it in installments. Filing also helps you to avoid making the same mistakes that put you in debt the previous year.
Avoid missing deductions or paying extra
The good thing with filing your income taxes early is that you have adequate time to go over your records and avoid missing any deductions. When you file last minute, you may end up paying more to whoever helps you in filing your taxes. When you claim all deductions that you qualify for, you can really maximize on your refund or even lower the amount that you owe. File early so that you can also take advantage of any new deductions that come each year.
Take advantage of the electronic filing system
The CRA has an electronic filing system that allows you to get rid of the paperwork when filing taxes. You no longer need to complete countless tax forms. The system allows you to file your returns really fast and they are processed quickly. You’ll get your returns fast because the CRA will simply deposit it directly to your bank account. CRS’s electronic filing system also helps you to manage your account by keeping track of all the returns you’ve filed over the years. If you want to speed things up and get a refund sooner, you need to file very early.
Claim your tax credits
If you don’t have much income or any to declare, you still need to file your tax returns. Filing allows you to claim your credits such as disability tax credits or provincial credits. You also need to file early in order to qualify for certain rebates, benefits and programs.
Deal with tax debt soon
It’s always important to find out if you owe money on your taxes so that you can deal with it sooner rather than later. While the government may not call you as often as a debt collector from a bank, paying them what you owe will help to avoid financial repercussions that could cause you in the future. Track what you spend or consider debt consolidation Innisfil to decrease the amount you owe. Look for ways to lower your expenses or increase your income in order to start paying the CRA what you owe. There are also nonprofit organizations that provide counseling on debt relief Innisfil which you can consult.