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How To File Taxes In Canada

How To File Taxes In Canada. It is important to Pay tax in Canada if you are an employee of Canada and have legal right to work in Canada. See below on how to pay your income tax and tax return.

Income tax in Canada

The Canada Revenue Agency (CRA) is in charge of administering income tax in Canada. Income tax year in Canada is from January 1 to December 31. If you owe income tax, endeavour to pay it by April 30 for the previous calendar year. Late submissions are accepted but there are always consequencesIf you are working in Canada, income tax will be deducted from your wages by your employer and the money will be sent to the CRA. In order to deduct the proper amount of income tax from your wages, you will be asked by your employer to complete the form TD–1. Employers are responsible for deducting an amount from each pay cheque for Canada Pension Plan (CPP) and Employment Insurance (EI).You have every right to determine your income tax status and paying the correct amount of tax.

What you need to file a Canadian tax return

You will need either:

  • A Social Insurance Number (SIN),
  • OR an Individual Tax Number (ITN)

Upon getting a SIN or ITN, enter it in your SSC account so that UBC can provide the government with accurate information for your taxes.

If you have either of these numbers but  has expired and you are not currently employed, the expired number can be use for filing taxes.

Social Insurance Number (SIN)

In other to apply for a SIN, you must have a work permit OR an on-campus job offer (with a valid study permit).

Individual Tax Number (ITN)

If you are not eligible to apply for a SIN, apply for an ITN. This is mostly for students who are on scholarships, as UBC will require you to provide an ITN at the end of Term 1.

Please note: Ensure you do not apply for an ITN past February as it can take a month or more. You can send your ITN application alongside the tax return to the same address that is specified on your ITN form.

Additional supporting documents when filing your taxes

  • T2202A – The tax year tuition fees paid. This can be download from the Student Service Centre.
  • T4 – Employment income and deductions. You may ask your employer to give you this.
  • T4A – Scholarships and bursaries.
  • General Tax Forms – this is available online and at all Canada Post offices

Apply for tax deductions

You may have the right to deduct certain expenses from your tax payments. Such expenses include:

  •  Transportation and storage of personal effects,
  • Travel expenses
  • Temporary accommodation may be considered eligible deductions.

Ensure to save your receipts for the cost of relocating to Canada. However, you cannot deduct moving expenses if your only income at the new location is scholarship, fellowship, or bursary income that is entirely exempted from tax under the current legislation.

How to file your taxes

  • Online
  • By paper – complete the formed and submit by paper
  • By mailing – When you submit your first tax return, you should send your return to International Tax Services Office, Returns Processing Division, 2204 Walkley Road, Ottawa, ON, K1A 1A8. If this is not the first year you are filing a tax return, you may apply online, or send it to the local office at Canada Revenue Agency

A tax return must be filed if you:

  • Are seeing income tax to the government (for example, you earn significant income in Canada)
  • Have been asked by the CRA to file a return

Even though you don’t owe any tax, you should still file a tax return if you:

  • Expect an income tax refund from the government
  • Are applying or intend to apply for the GST/HST credit (which provides cash payments to low- and middle-income taxpayers, to help offset the costs of paying GST/HST on taxable purchases)
  • Might earn more income in Canada later (e.g., co-op) so want to carry-forward (this simply means saving for future years) Tuition Payment and Education Credits to reduce the tax you owe in future years.

Those on scholarships, bursaries or fellowships do not need to pay taxes on their income, but you must give UBC your ITN or SIN when UBC requests it for tax purposes.