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5 Tax Tips for Canadians

It’s that time of year again: tax time. Tax season can be stressful as we watch our hard earned dollars be ‘given away’ to the government. If you’re tired of watching your money slip through your fingers and want to save on taxes, here are 5 great tax tips to help you do just that:

 

1. Be Generous – Not only is this a great life philosophy but it also comes in handy around tax time. Although it varies from province to province, the tax credit you receiving can often increase as you give more. (Just remember to get a receipt when you do give!)

2. File on Time – Filing your taxes on time can save you cash. Being late will mean being dinged.  You can be charged five percent of your owing balance plus one percent for each month that your balance is late. Avoid that! Note: Personal tax must be filed by April 30 – 2012, Small Businesses by June 30 – 2012

3. RRSPs – Contributions to your RRSPs can mean tax deferral. Take advantage! During the year consider having your RRSP contributions come out of your bank account automatically. Having it done automatically will not only shorten your to-do list but also help to ensure that you invest as much as you plan to.

4. Be Accurate – As much fun as getting a fat cheque from the governenment can be, essentially what you’ve done is given them an interest free loan on your money! That money is money that you could and should be investing! Make your money make money and don’t be over on your taxes (or under). Try to be as accurate as possible.

5. Claim Medical Expenses – You may claim medical expenses for yourself, your dependents, and your spouse. To claim the expenses must exceed 3% of your net income. So, keep those medical receipts and count them up!

 

For more information on how to save money on your taxes visit the Canada Revenue Agency Page

 

How are you saving money this tax season?

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