Let’s face it, online software and auto-fill features are making tax-filing less and less painful even for the do-it-yourselfers.
Still, whether you’re outsourcing the work to an algorithm or an accountant, it’s always a good idea to know when deadlines fall and what’s new every year.
Here’s our guide to the 2020 tax season:
1. When is the deadline to contribute to my RRSP?
Since March 1 falls on a Sunday this year, the cutoff this year is March 2.
Remember, you can put money into your registered retirement savings plan (RRSP) any time. But if you want to get a tax refund for your RRSP contribution with your 2019 return, you have to add the funds by the March deadline.
2. When’s the tax-filing deadline?
As usual, April 30 is the date most Canadians need to keep in mind. For the majority of tax filers, this is the deadline to both pay any tax due and file returns.
If you’re self-employed, this year you have until June 15 to file. Remember, though, that if you owe taxes, you still need to pay up by April 30.
If you’re late to either settle your balance or send in your paperwork, you’ll face late-filing penalty and daily interest charges on any taxes owed.
3. When’s the earliest I can file?
If you just can’t wait to get that big refund, know that the Canada Revenue Agency (CRA) will start accepting electronic returns on Feb. 24.
Most people want to skip the tax-processing queue because they anticipate getting money back. But having a big tax bill is also a good reason to file early. That allows you to set up a plan to pay your tax in installments. The more you manage to pay by April 30, the fewer extra charges you’ll face.
Still, there are potential drawbacks with filing too early, said Robin Taub of TurboTax. Many of the tax slips you need to file your return are due March 2, so it’s not a good idea to file before then unless you’re sure you’ve received all of them, she noted.
Also, it usually takes until mid-March for tax slips and other information the CRA has on file to become available through its auto-fill my return feature, which allows you to automatically fill-in part of your return.
4. What’s new this year?
Here are the highlights:
New and improved federal tax breaks:
Climate Action Incentive. Albertans will now be able to claim this federal incentive, while residents of New Brunswick will not. If you live in Saskatchewan, Manitoba or Ontario, you continue to be eligible and stand to receive a considerably larger amount this tax season compared to last year.
The money, which may create or boost a tax refund or reduce a balance owing, is meant to offset the cost of the carbon tax in provinces that do not have a carbon price regime of their own. The amount of the tax credit depends on family size — you can use this table from H&R Block to calculate how much your household can claim.