Whether we like it or not it’s time to file your taxes. Even if an expert files them for you, it is still your responsibility to get the information together. Are you feeling the pain involved with this annual necessity?
Important dates to remember:
• Income tax returns for individuals are due April 30, 2010
• Any tax monies owed are due April 30, 2010
If you are married, living common law or have a family, it is important to file your taxes together to receive the best advantage of all qualifying deductions and credits such as college tuition, child care expenses and medical costs.
A few simple reminders to save you money:
• If you plan to seek expert advice during the tax season, look early
• If using an expert, bring everything related to your taxes, including last year’s information
• Have a system to separate all your paperwork- this could be envelopes, an accordion file or file folders
• After you have organized your papers and receipts in categories, flatten them out and have them upright to save time for you or the expert. Save money by having your papers in order or get one of your older children to do this task. Why pay expert rates to flatten documents and put receipts in a readable manner?
Important dates to remember:
• If you are self employed but not incorporated, the deadline for filing your personal income tax is June 15, 2010
• Any tax monies owed are due by April 30, 2010
If you are a business owner, remember that everything that pertains to your business is an expense. If it is helpful and appropriate for your business, you can claim it. Keep receipts when you entertain clients and employees. Keep information about the engagement such as a guest list, business discussed or new business relationships.
Sort all proof of income, print all invoices and remittance statements so you and/or your tax expert knows how much money has come in and out of your business account.
If you own a business and are keeping your own books, electronic programs such as Simply Accounting or QuickBooks may be an option for you. If your business is not as complicated an excel spreadsheet will work fine. Keep a receipts file near your desk and schedule a time once a week to place them in the appropriate folder. Keep a mileage log in your car to keep track of kilometers, parking and bridge tokens. A mileage log is a requirement if you are audited.
If you do not already have a system in place, label folders into categories appropriate to your business. Begin by labeling and organizing:
• General information- such as social insurance number, birthdates, addresses and your tax return from last year
• Travel- your mileage log and day to day business and travel expenses
• Donations- receipts for charitable donations
• Supplies and Equipment- receipts for supply and equipment expenses, bills from the phone company, power company and all bills paid to keep your office operating
• Invoices- marketing, printing, continuing education, professional development, mail and courier costs, pertaining to your business
• Payroll- copies of invoices, cheques and hours for your reference
• Auto- monthly payments, maintenance, upgrades and upkeep of your vehicle
• Medical Expenses- keep records of drug purchases, insurance plan payments and receipts from clinics
• Entertaining- make sure you note on the receipt who and what the purpose
Tax time will be less painful with a few simple steps to plan for next year.
Further information can be obtained on the Canada Revenue Agency website at www.cra.gc.ca