The deadline to file your taxes is coming up fast and many people have already filed their tax returns. That being said, many people filing taxes may realize that an error has been made and that they need to adjust their taxes. We are going to go through some of the most common mistakes that are made during the filing of taxes and what options you have available to you to correct these mistakes.
Claiming Ineligible Expenses
Claiming ineligible expenses is a very common error to make when filing taxes. Often when people make claims for expenses such as medical, tuition, or moving expenses, they may include amounts that are not eligible for tax deductions. You can find lists of eligible expenses for each category on the Canada Revenue Agency website if you are unsure of whether an expense qualifies for any deductions. You can also consult a school or program to determine whether the tuition amounts you paid are tax deductible.
Not Claiming Credits
Many people forget to claim new credits that they may be eligible for because they may have not heard about them or are unsure of whether they are eligible to receive them. It’s very important to know what tax credits you can claim in order to get a larger refund. You can always consult with the Canada Revenue Agency to learn about new credits that are available during the tax year. You can also visit a professional to ensure that you are claiming all eligible credits. A new credit that all residents of Ontario, Saskatchewan, New Brunswick, and Manitoba can claim is the climate action incentive. When residents are aware of these new credits they can claim them in order to increase the amount of their refund and ease their tax burden.
Not Reporting Common Law Status
Couples that are not married but living together for at least 12 months can report that they are common law partners. Reporting that you are living common law with your spouse will result in the same treatment as a married couple for tax purposes. Reporting common law status will give you benefits in transferring credits between one another and splitting amounts for expenses.
Keeping Valid Receipts
Remember that you must keep records of receipts for the past six years. The CRA can ask you at any time to produce these records in order to validate any deductions you have claimed for the past six years. Failure to provide these receipts will result in deductions being cancelled and you having to pay the amount back.
Not Filing Your Taxes on Time!
We have gone through the mistakes that are common to find after you have filed your taxes, however, the biggest mistake you can make is not filing your return on time. Even if you are self employed, you must pay tax owing on April 30th and if you do not pay your tax owing, you will be penalized with a 5% penalty(on your balance owing) along with 1% for every month which you are late!
If you’ve filed your return and made one of these mistakes don’t panic! You can still make adjustments to your return in order to change the amount you owe or the refund that you should receive. If you are a TaxTron user you can Refile your return with our software to make the necessary adjustments to your return. Download TaxTron now and see how easy it is to file your return with our software!
You can also visit a Softron Tax location near you to have a professional make adjustments to your return and ensure that you are receiving the highest refund possible.