Who Should File a Tax Return in Canada?

By Randall Orser | Personal Income Tax

Even if you have no income there are good reasons as to why you should or are required to file an income tax return; 

  • You owe tax to the government or have to repay any of your Old Age Security or Employment Insurance benefits.
  • You are self-employed and have to pay your Canada Pension Plan employment insurance premiums.
  • You are your spouse want to split your pension income.
  • You are a participant in the Home Buyer’s Plan or Lifelong Learning Plan and have repayments due.
  • You disposed of capital property for example you sold your home.  In this instance you must file a return even if you don’t have to pay capital gains on the sale under the principal residence exemption.
  • You have received a Working Income Benefit advance or payments in 2018.
  • The CRA has sent you a Request to File, or a Demand to File in which case they are serious about your lack of filing, so you had better get on it!

Whatever your residency status in Canada, you have to file a return especially if any of the above criteria apply to you.  

If you live abroad but receive income from a business that you own, investments or property you own in Canada you will need to file an income tax return.

There is no age exception - if you meet one of the criteria above you need to file.

Students are not exempt, if you earned over $3500 in 2018 you will need to file a return even if you are still in school.

Even if you are not required to file it is usually in your best interest to file anyway;

  • If you want to claim a refund
  • If you are eligible for certain benefits programs.  Even with no income you may qualify for GST payments.
  • Your RRSP contributions limit increases as soon as you have any income which may benefit you in the future when you are able to contribute.
  • If you want to claim tuition credits you need to declare the amounts on your tax return.  It may not result in a refund this year, but you can apply these unused credits to a future return.

From an article by Turbo Tax Feb 2, 2019

 

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President/CEO Number Crunchers® Accounting Inc. Learn how to just say stuff it to this bookkeeping thing with our 'Just Say: "Stuff It" To Bookkeeping program.