Some Common Questions People Ask

Do I Have To File A Return Each Year?

If you are new to Canada or if you are just entering the workforce, you may be wondering if filing a Canadian tax return is a necessity, and if so, when do you have to file your first tax return?
 
The Canada Revenue Agency (CRA) does require annual filing for most citizens but there are exceptions, so let’s have a look at who is required to file a Canadian T1 General tax return and when.

You Must File an Income Tax Return, If:

  • You owe tax to the CRA.
  • You are self-employed and have to pay your Canada Pension Plan premiums.
    • Same for paying employment insurance premiums on your self-employment earnings.
  • You and your common-law spouse / partner want to split your pension income.
  • You’re participating in the Home Buyers’ Plan or Lifelong Learning Plan and have repayments owing.
  • You disposed of capital property. If you sold your home, you must file a tax return even if you don’t have to pay capital gains tax on the sale (referred to as the principal residence exemption).
  • You have to repay any of your Old Age Security or Employment Insurance Benefits
  • You have received a Working Income Tax Benefit advance payments in the tax year.
  • The CRA has sent you a Request to File.
  • If the CRA has sent you a Demand to File, then that means they are serious about your lack of filing and you had better get to it.

Making Money in Canada

Your Canadian residency status doesn’t affect whether or not you have to file a Canadian income tax return, however, it does affect how you file your taxes, what income you need to report, and the availability of certain credits or deductions.  If you meet any of the CRA’s criteria listed above, for example, you have to file a tax return regardless of your residency status.

If you live in another country but receive income from a business you own in Canada, or from investments you have in Canada or if you have property in Canada, then you will need to file an income tax return.

No Exemption for Age or Occupation

Whether you’re 9 or 90, age has no effect on your requirement to file a tax return. If you meet one of the above requirements, the CRA expects to receive an income tax return from you.

Should I Do My Own Bookkeeping For My Business

This is probably the single most asked question we encounter at DTA from our business clients. We at DTA feel that it comes down to a question of time and experience. On top of running your business day to day, do you have the additional time, will, desire and accounting knowledge? We at DTA believe in the term “You do what you do best and let the professionals at DTA do what we do best.” Contact us and see how we can help you manage your business and keep you on the right track.

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