Blog http://www.melaniegesy.ca/ en-us Wed, 1 May 2019 00:00:00 MSTimages/header.jpghttp://www.melaniegesy.ca/ Filing Your Taxes Late http://www.melaniegesy.ca/Blog.asp?id=50 Wed, 1 May 2019 00:00:00 MST

 

Tax season is quickly coming to an end on April 30th. If you have already successfully filed your taxes before the deadline then this blog is not meant for you. If you are a procrastinator and haven't sent in your return yet - keep reading!

 

The Deadline

As listed above, most Canadians Income tax and benefit returns are due by Monday, April 30th. Individuals with self-employed incomes, spouses or common-law partners that garnered self-employed earnings in 2018 have until Saturday, June 15th to file. Any self-employed workers have until June 15th to file as well, but they must pay any balance owing by April 30th. Since June 15th lands on a Saturday this year, those filing before that date have until Monday, June 17th. 

 

Interest

Let's say you have a balance owing for 2018, the CRA charges compound daily interest starting on May 1st, 2019 for any unpaid amounts that you may owe. This also includes any balance owing if the CRA reassess your return. 

 

Late-filing Penalty

If your balance is zero or if you're getting a refund you shouldn't stress because you won't be given any penalties for filing late. If you do have a balance owing, you could be looking at a large penalty. Your penalty would include five percent of your balance owing plus one percent of your balance owning for each month that your return is overdue. If you always seem to be filing late and have already been charged the penalty in the last three years then you now owe ten percent of your balance owing, two percent of your balance of each month that your return is overdue up to twenty months.

 

What can you do?

In some cases you can actually ask the Canada Revenue Agency (CRA) to waive or cancel late filing penalties if the reason you filed your return was because of circumstances out of your control. To request a waiver you will have to complete a specific form that includes details on what the specific circumstance was and if it justifies the late filing. Click here to see form.

 

Melanie Gesy Professional Corp. is here to help! Call 780-995-5236 today.

 

 

 

Sources used:

https://turbotax.intuit.ca/tips/the-heavy-price-of-late-tax-returns-248

https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/interest-penalties.html

 

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Weird things people have tried to Claim on their taxes http://www.melaniegesy.ca/Blog.asp?id=49 Tue, 19 Mar 2019 00:00:00 MST

 

We all know how difficult it is to figure out what you can and cannot claim on your tax return. Here are some strange things that people have tried to claim. Enjoy!

 

Lottery Tickets

Who doesn't love a good scratch-off ticket? Unfortunately lottery tickets cannot be claimed on a tax return. The only way you can do so is if it is for a charity lottery where you are able to claim a portion of the ticket as a donation. Lottery tickets are look at as a "fun" purchase and not a necessity. 

 

Pet Food

We all love our fur-babies, they are a part of the family! Many people have tried to claim their animals food along with other pet expenses on their taxes but sadly pets do not count as dependents. If they are a service animal than you are able to do so.

 

Iguanas

A woman who ran an in-home daycare wanted to claim her expenses from her two iguanas because they were purchased for her business. Pet expenses cannot be deducted unless the animal is a service animal like said above.

 

Trips

A man attempted to claim a $1,500 trip to Las Vegas as a medical expense but was denied. A doctor recommended to the man that he escaped to a warmer climate during the winter months because of his skin condition. Since this man didn't undergo a medical treatment or procedure from a health care provider, his trip would have been seen as for pleasure. 

 

A different person tried to claim their trip to an all-inclusive five-star resort in Bermuda as a medical expense. When caught, they claimed that they suffered from a Vitamin D deficiency.

 

Oxygen

If you have ever travelled to Las Vegas then you have most likely seen the oxygen bars that are placed throughout the hotels. These oxygen bars are often visited by the extremely hungover. A hungover man attempted to claim his sessions at one of these bars as a medical expense. 

 

Footballs

One of the Edmonton Eskimos players deducted almost $600 in expenses from his income. His reasoning was that he threw multiple footballs into the crowd after he scored a touchdown. His deduction was denied by a tax court judge because him throwing footballs into the crowd was not part of a sponsorship deal. 

 

Melanie Gesy Professional Corp. is here to help! Call 780-995-5236 today. 

 

 

 

Sources: 

https://www.hrblock.ca/weirdest-things-canadians-have-tried-to-claim-on-their-taxes/

https://www.huffingtonpost.ca/2018/04/25/strangest-expenses-income-tax_a_23420181/

https://globalnews.ca/news/3242825/12-unusual-canadian-tax-deductions-that-filers-have-tried-to-claim/

 

 

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Are you Ready for Tax Season? http://www.melaniegesy.ca/Blog.asp?id=48 Mon, 4 Mar 2019 00:00:00 MST

It's that time of year again - Tax Season!

Are you organized?

The first step is to set aside a day to go through documents and paperwork that you have collected over the year - you may be surprised by what you can submit on your tax return! Look for T4 slips (employment income), official RRSP (Registered Retirement Savings Plan) tax receipts, any charity donation receipts, and any other paperwork or receipts that you think you could claim. Not sure what you should provide? Give your accountant a call to find out what you exactly need, they are there to help! Going the do-it-yourself route? There are tons of online resources that can be extremely helpful. If you have multiple people filing taxes in your house hold try having a separate folder for each person to help keep everything as organized as possible!

 

Do you know the deadlines?

  • March 1, 2019 This was the deadline for contributing to a Registered Retirement Savings Plan.
  • April 30, 2019 Income tax and benefit returns due
  • June 15, 2019 Deadline for Self-employed individuals and their spouse/common-law partner to file their returns. Since June 15th, 2019 falls on a Saturday, the CRA is accepting returns until the following Monday on June 17, 2019.

If you owe taxes, they are still due by April 30th, 2019.

 

Do you have to file?

You do not technically have to file your taxes unless you owe money to the CRA, we highly suggest that you do continue to file every year. If it turns out that you do not owe money it probably means that you will receive a refund, which means money back into your pocket! Filing your taxes every year is just good practice.

 

If you are someone who collects certain benefits (such as the GST credit, Canada Child Benefit, Guaranteed Income Supplement, and many others) then you should keep filing your taxes - tax returns determine if a person qualifies for certain benefits. If you qualified in the past and don't file your taxes you will stop receiving the benefit until you file again. If you don't currently receive these benefits, the only way to know if you qualify to collect it is to file your tax return.

 

How long should I keep my previous returns for?

You should keep your tax records for six years! Make sure to keep them somewhere that is easy to grab just in case you ever need them.

 

Stay educated

Taxes can be confusing, especially when they seem to be always changing! Here are 2019 tax changes that you may not know.

 

Melanie Gesy Professional Corp. is here to help! Call 780-995-5236 today.

 

 

Sources Used:

https://www.canada.ca/en/revenue-agency/news/2019/02/backgrounder--2019-tax-filing-season.html

https://www.ratesupermarket.ca/blog/are-you-ready-for-tax-season/

https://globalnews.ca/news/1891826/filing-your-tax-return-dont-forget-these-credits-deductions/

https://www.canada.ca/en.html

 

 

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Filing Taxes for the Deceased http://www.melaniegesy.ca/Blog.asp?id=47 Mon, 25 Feb 2019 00:00:00 MST

 

When grieving for a loved one the last thing on your mind is their tedious tax obligations. Here are some important steps to help you through!

 

Decide on an Executor

An executor (Personal Representative) is someone who is responsible to gather information about property, deal with debt the deceased may have, and follow instructions in the deceased will. One of the executor's responsibilities is to locate the deceased previous seven years income tax returns and provide the copies to a lawyer or accountant. If not done, the executor could be personally liable for any tax penalties for any tax dates that are missed. If nobody wants step forward to become the executor, the court will appoint an administrator to manage the deceased's estate. This person could be a spouse, common-law partner, or the deceased next of kin. 

 

Have you Notified the Government?

Whoever the executor is must contact the Canada Revenue Agency (CRA) as well as Service Canada to provide a death certificate to both. This is a very important step so any government benefits or grants can be stopped immediately. You can call the CRA at 1-800-959-8281 or complete this form and send it to a tax service office to get more. 

 

Types of Returns

There are 3 different returns that may need to be prepared, depending on the types of assets in the estate. Please consult an accountant to determine which of these returns are required.

  • Final personal tax return (mandatory) - same as the regular personal tax return to report all income up to the date of death.
  • Rights and things return (optional) - same as the regular personal tax return to report certain income earned from the date of death up to December 31 of that same year.
  • Estate Tax Return (T3) (depends on the assets in the estate) - special type of return to report income earned by the deceased's estate after death.

 

Time to File

The executor must have a record of the deceased's income from the beginning of the year they pass away up to the exact date of death. Finding this information can be tricky, the executor may have to contact employers and other financial institutions. Any other tax documents like receipts must also be included.

  • If the deceased passed away between January 1st and October 31st the filing is due by April 30th of the following year.
  • If the deceased passed away between November 1st and December 31st the filing is due six months after the date of death.

 

Clearance Certificate

A clearance certificate is provided from the CRA, it validates that all debts of the deceased to the government have been completely settled or a security payment has been made. This certificate lets the legal representative (the executor) distribute assets without any risk of being personally liable for anything the deceased owes to the CRA. The clearance certificate can be requested ahead of time, but will most likely not be signed off until all tax fillings are complete.

 

We know going through the grieving process can be rough. Call 780-995-5236 - we are here to help!

 

 

 

Sources:

http://www.afsa.ca/Executors_414499.html#f175760

https://www.hrblock.ca/how-to-file-taxes-for-a-deceased-person/

https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/rc4111/canada-revenue-agency-what-following-a-death.html#P12_526

 

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