How Do You Become Pro Active in Your Taxes?
The first thing you may want to think about is why you should you become pro active with your taxes and to determine this you need to know how it will benefit you.
It is not uncommon for most personal tax payers to basically leave their tax situation up to their circumstances. They don’t believe that there is anything they can do to change the amount or the way they have to meet their tax obligations, so why bother trying to give it any further thought?
By becoming pro active in regards to your taxes you actually can do some very significant things that could benefit your tax situation. It could be that errors have been made on either your part or even the CRA. Yes, believe it or not they do make mistakes. Or, it could be that you are avoiding a tax situation whereby if you become pro active regarding the situation you can rectify it.
Let’s look at the persons who really have no tax issues to deal with other than filling out their taxes each year and paying whatever the tax government deems necessary. In most cases these tax payers will either complete their tax forms themselves, or perhaps use the local tax preparer who shows up out of nowhere at tax time. Once the forms have been filled and signed the tax payer gives it no more thought. They are trusting enough to assume the taxes have been done correctly, and as long as they don’t owe the tax department any more money they are happy. They have not given any thought as to what potential tax credits or breaks they may be missing out on.
To be pro active in this case would be to at least review the various components of the tax form and see if the figures make sense. There may be a section of the form that stands out where you have some idea that perhaps you could have saved some money here.
If you have taken the more secure step of tax form completion and have used a good accountant to complete this task for you then chances are you have reduced the possibility of losing out on some of the common tax deductions. Here though you can have a short review of your tax filings and see if your tax expert has any suggestions as to how you can better your tax situation. This only takes a few minutes of your time, rather than signing on the dotted line and forgetting about your taxes for another year.
Our Canada tax system is huge and has gotten to the point where it is overwhelming. This is one of the big reasons why so many people don’t bother to become more involved in their personal tax situation. By using an experienced accountant you don’t have to be totally knowledgeable in the tax laws, but it is worth your while to understand those tax regulations that have a direct effect on you.