The following are few of the items you should be aware of when it comes time to file your Canadian tax return.
The RRSP contribution deadline
2020 is a leap year. This year’s RRSP contribution deadline is March 2. You should make sure to double check your 2018 Notice of Assessment for your current RRSP maximum contribution limit.
It is important to be mindful of this maximum amount. This is because there are a significant tax rates (1% per month that remains over contributed) imposed on over-contributions.
The filing deadline
This year that deadline falls on April 30th. As such, most taxpayers must file and pay their taxes owing before this date to avoid late filing penalties and interest.
Furthermore, those who are self-employed (and their spouses) have until June 15th to file their tax returns. If you owe taxes interest is charged as of April 30th, but the late-filing penalty is waived up to June 15th.
Revenue Canada’s e-filing system
The federal agency closed its system for updating. The E-file system is scheduled to open for 2019 Tax Returns on February 24, 2020. This is not a big issue considering the filing deadline for T4 slips is March 2. In addition, you’ll likely have to wait for T5 and T3 slips from various financial institutions before filing as well.
Important charges for the 2019 tax return:
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- Climate Action Incentive (CIA); Manitoba is increasing the amount of incentive being paid out to its residents. Incidentally, for 2019’s tax return Albertan are also be eligible for the CAI just as Saskatchewan, Ontario and Manitoba residents continue to be eligible.
This is a per household credit. Meaning only one person per family household can claim this credit. - Larger Withdrawal limits for the RRSP Home Buyer’s Plan. The tax-free withdrawal of RRSP vested funds for the purchase of a home has been increased. As a result, the maximum withdrawal is now raised to $35,000 (up from 25,000) for amount taken after March 19, 2019.
Any withdrawn amount must be paid back over a 15-year period. Furthermore, should you miss a repayment for a particular tax year, then the required repayment amount will be added into your taxable income for that year. - Medically prescribed Cannabis qualifies for the medical expense tax credit
- Climate Action Incentive (CIA); Manitoba is increasing the amount of incentive being paid out to its residents. Incidentally, for 2019’s tax return Albertan are also be eligible for the CAI just as Saskatchewan, Ontario and Manitoba residents continue to be eligible.
The above items are by far an exhaustive list of new provisions, or items that may impact your specific return. Contact you tax professional for more information.