Tax time is in full swing here in Canada, and that means that it’s time to organize paperwork and start filling out forms to ensure the maximum possible refund, or the minimum possible payment! This year I’ll be using TurboTax to help me file online and I’m so excited to finally see for myself how quick and easy filing online can be. Since TurboTax offers both an accurate calculations guarantee and a maximum refund guarantee, I know that there’s no risk of having to pay a penalty or miss out on potential savings.
If you’re starting to organize your paperwork for tax time, there are a few often-missed Canadian tax deductions that you should make sure to consider as well. After all, even small amounts saved can help lower the impact of tax season…or make that refund cheque even bigger! These four tax deductions are among the top ones missed by Canadians when filing taxes:
Since Canada provides basic healthcare coverage to its citizens, medical expenses aren’t something often claimed by families. But other out-of-pocket medical expenses can really add up during the year. Dental appointments, medical prescriptions and travel medical insurance can all be claimed as medical expenses. So can hearing aid batteries, healthcare premiums paid to an employer’s healthcare plan and travel expenses incurred to obtain medical services.
Most people know that donations to registered Canadian charities can be claimed as a non-refundable tax credit. But many people don’t take the time to maximize the benefits of that tax credit. For example, spouses can combine their donations to take advantage of the higher tax credit rate. Previous donations that aren’t needed in lower income years can also be carried forward to future years to maximize the benefits of the credit. A little planning can result in much bigger savings when claiming charitable donations.
Eligible Dependant Credit
Whether you have an elderly parent living with you or you’re a single parent supporting your children, the Eligible Dependant Credit provides a significant tax credit benefit. Just as with the spousal tax credit, any income the eligible dependant earns is deducted from the amount of this credit. In the case of a retired parent or a child, the savings are still usually very significant. Note that a single parent with more than one child can only claim the eligible dependant credit once.
Self Employment Expenses
There are plenty of business expenses for a self-employed individual and finding the maximum amount of deductions just makes sense for anyone that’s running their own business. If you work out of your home, make sure to claim the appropriate portion of your house expenses as a business deduction. A percentage of your mortgage interest, property tax and utilities can all be claimed. Vehicle expenses can also be claimed when travelling for work. Office supplies, advertising expenses, memberships, salaries and meals are all partially or fully deductible as well.
I have to admit that last year, when I filed on paper the old-fashioned way, I missed a very important deduction. As a single parent, I was entitled to claim one of my children as an eligible dependant; a much higher tax deduction than the child deduction I claimed instead. What irks most is knowing that TurboTax would have caught that mistake when I filed and saved me money when the time came to pay! At least I won’t have to worry about the same thing happening this year.
For more great tax tips and information, make sure to check out the TurboTax blog. And if you want to see for yourself how quick and easy it is to file with TurboTax, head over to the website and try it risk-free! You can prepare your entire return online, then pay at the end when you’re satisfied with the results and ready to file. A simple return is often completed in as little as thirty minutes! Grab your receipts and tax paperwork, pour yourself a cup of coffee and get ready to tackle your tax return this year. With free live advice and an easy-to-use format, it’s enough to make you say goodbye to filing on paper forever!