4 Fail Safe Ways to Steer Clear of Tax Problems

How To Avoid Tax Problems?

  1. Keep all your tax papers in one place. Placing T-Slips and receipts in one place helps avoid any lost information. Not only does keeping everything in one spot reduce the chances of losing information but keeping all receipts can optimize your tax return.
  2. Replace Your Lost T4. If you have misplaced a T4 fortunately there are options to recuperate it, you can ask your employer for a second copy or go to the CRA website and access it through your CRA account. If you are not able to get your T4 on time, file your taxes anyway, attach a note explaining the issue along with your employer’s information.
  3. File on time. File your taxes on time, the deadline for filing your taxes is April 30th for personal returns. Self-employed individuals have until June 17th to file however if you owe taxes you’ll still need to pay by April 30th to avoid any interest charges. Electronically filing tax returns begins February 18th.
  4. Pay your bill on time. The time between receiving your T-Slips and the filing deadline may be shorter than expected. File as soon as possible to avoid rushed mistakes and allow you more time to pay off your taxes. If you owe taxes the amount is due April 30th to avoid interest charges, after April 30th daily interest charges will apply. Another perk of filing before the deadline is if you receive a refund then you’ll receive your refund earlier. Owing money isn’t a bad thing. If you owe money to the CRA that means you received more income that you were supposed to that year.


What Happens When Tax Issues Can’t Be Avoided?

Audits can’t be 100% avoided the CRA randomly chooses to audit Canadians every year. Over two million Canadians get audited every year by the CRA if you get audited and want to avoid owing more taxes or getting fined, be honest on your tax returns. To prepare for an audit ensure all your tax information is organized and always keep up to 7 years of tax information, the CRA may go back up to 7 years. If you get audited hire an accountant to help represent you against the CRA.

Although somethings can’t be avoided hiring a tax professional can help eliminate potential problems with the CRA.

For more information visit vsaccounting.ca