By Junita Thakorlal
Vancouver: For millions of Canadians, the tax return deadline is a sad reminder of the hustle and grind in an increasingly complicated income tax system which Prime Minister Justin Trudeau’s government promised to simplify and improve back in 2016 for fairness and efficiency. More than two years later, Canadians are still waiting for any significant action to be taken.
According to the Fraser Institute, the average Canadian household earns $83,000, of which nearly 43% is paid out in taxes to federal, provincial, and municipal coffers. This, of course, includes personal income tax. For those that have yet to submit their personal income tax return to the Canada Revenue Agency (CRA) by the April 30 deadline, be warned as stiff penalties may ensue.
“The late filing penalty for any balance owing for the 2017 tax year is 5% which is levied right away, and an additional 1% for each full month thereafter for up to 12 months,” warns senior supervisor at the CRA, Daljeet Grewal. “If you have an established non-payment or late-payment pattern, the penalties dramatically increase to 10% of balance, with an additional 2% owing monthly if left unpaid.” For Canadians that are self-employed, the filing deadline is June 15, but any balance owing will still need to be paid by April 30.
Grewal further shares, “you can file your own taxes online which is faster, easier, and secure, or your accountant can file for you.” Although Canadians may be weary of online security breaches, Grewal assures, “security features that CRA uses is similar to what your banking institution uses so there is no chance of your personal information being compromised. Plus, you can access up to 10 years of your previous returns should you need them. We encourage online filing.”
To help us grasp the concept of online income tax filing, we turn visited the websites of two of the largest accounting firms in the country. Not surprisingly, the results were different from that of CRA for an individual earning $50,000, which brings us back to the confusing tax system which governs our income. These are the taxable rates as advertised online:
Canada Revenue Agency: 15.45%
Price Waterhouse Coopers: 16.38%
Ernst & Young: 16.38%
“If your return is not perfect, or it is missing something, you can always refile any changes that you previously missed but we encourage everyone to try to make the deadline of April 30,” urges Grewal.
Tax returns can be dropped off at Service Canada offices or any Canada Post outlet. Canada Revenue Agency has extended hours of service, 9am – 9pm Monday to Friday, and 9am – 5pm Saturday. Visit their website www.canada.ca/taxes for more information or call 1-800-959-8281.