Back on the 15th of February, the Synergy Merchant Services Blog discussed the fact that many Canadians are not properly filing their taxes. As a result, numerous individuals miss out on potentially lucrative tax returns. In fact, Evelyn Jacks of The Toronto Star wrote earlier this week, that millions are paying more in taxes than they should.
Among the major mistakes are omitting valuable credits and deductions or not filing their taxes at all. In addition to risking facing unnecessary penalties, these tax mistakes and can prove very costly. Many Canadians count on their tax returns for major expenditures every year and our losing out due to improper filing.
To help our nation avoid these tax-filing pitfalls, Jacks has offered up a number of tips to help people use the tax system to their advantage. Being fully immersed in tax season now, we hope that these tips will come in handy. As always, we will provide our own insight on this list of suggestions.
The first thing that Jacks suggests is that you file your income taxes as a family. In order to get the best return for your household, you should begin by preparing each return separately starting with the lowest income earning. Look at the return for each family member and then tweak them so that you can claim the best tax results for the family unit as a whole.
File on time, says Jacks. Many people put off filing their taxes out of fear that they will owe an amount that they cannot afford. This isn’t a problem that will simply go away. Filing your taxes yearly is a requirement that if avoided, will only lead to further financial strain and legal ramifications.
Remember that it is your legal right to prepare your tax return to your family’s benefit, looking for every tax deduction and credit that you are entitled to. Jacks reveals that you can even claim errors or omissions from previous tax returns going back ten years! It takes some extra effort, of course, but it can certainly pay off in the end.
A house is a great investment. So much so that Jacks recommends that you buy one, insisting that “owning a home is a cornerstone of wealth for Canadians and about 60 per cent of all Canadians do. Half of those homeowners have paid off their mortgage, freeing up cash flow, particularly in retirement.”
We will continue to take a look at some more tax tips in tomorrow’s blog.