A lot of time throughout life we get ourselves into trouble simply because we have developed some bad habits. While most of the time these aren’t too serious there are some that can cost us money without even realizing it. One of these areas is your taxes, and you may discover that once you break these tax bad habits that your tax obligations are not nearly as bad as what you have perceived them to be.
The easiest way to form good Canada tax habits is to look at the bad ones and their potential consequences. Then you determine which ones of these you are guilty of and change them around.
Procrastination:
This one is a whopper because it can really affect you adversely in many different areas of life. In respect to your taxes you are merely putting off getting them completed and filed in time. Your reason for doing this isn’t because you owe the CRA a few dollars, it is simply because you keep putting this obligation off until tomorrow, until before you know it, the tax deadline has passed and you are late, (perhaps again). Now you are going to end up paying penalties and interest until you finally get them done and in. All of this hassle just because you procrastinated.
Unorganized:
Most people really dislike having to do their tax return. Not just because it can be really complex, or because they owe some money, but simply because they don’t have all their necessary documents organized and kept in one place. Now they have to go all through the many junk drawers to see where they have put their necessary tax information. This really makes the job of tax filing frustrating and irritating, yet it is self-inflicted.
Lack of knowledge:
There are some people that really are not familiar with the basic Canada tax requirements. This could be because they are a new resident of Canada, or they have just become a tax payer, or even because their tax situation has changed. As a result the taxes are not filed correctly. Now a simple tax filing becomes much more complicated and drawn out because they have to deal with the CRA to get things done right.
Reversing the bad habits:
To change all this around you simply need to reverse these bad habits. As soon as tax season begins be an early bird instead of a procrastinator and get those taxes filed. Not only will you be free of the yearly tax hassle, but you will feel good about yourself.
Start a tax file and put it in a safe place. Then as you gather your tax information put it in this file. When you are ready to sit down or take your taxes to your Toronto accountant you will have everything in one place and aren’t going to run into potential tax problems.
If you are not sure about how to do your taxes or really want to maximize any potential tax breaks that may be available to you, then hire an accountant to do this job for you.