In Canada, every person must file income tax and benefit returns each year. The due date for having your taxes filed is April 30th – but if you’re self-employed you have until June 15th.
So that means if you are filing your 2021 taxes, they will be due April 30th, 2022, and June 15th, 2022, respectively.
However, just because you have until the end of April to file your taxes doesn’t mean you have to wait until the last minute!
The earliest date that the CRA (Canada Revenue Agency) will start accepting electronically filed tax returns is usually around February 22nd.
But keep in mind that some tax slips are not due until March so you may not have all of the information you need by the end of February.
When Can I Expect My Tax Refund?
Getting your tax return can be quicker than you think. The CRA cannot guarantee a timeline but they do have stated goals for getting you your money as long as you file before or at the deadline.
Typically, if you file your tax return online, the CRA’s goal is to send your return within two weeks. If you file by paper return, the goal is eight weeks.
However, if the CRA decides to take a closer look at your tax return and reported income, or initiates a tax audit, it can take longer. And, if you’re filing from outside of the country, there is a 16-week wait time.
How to File Your Tax Return
When it comes to filing your tax return, you have a few options:
- NetFile. NetFile allows you to use a software package so you can fill out your own tax return and file it electronically.
- Autofill. If you use certified tax software, you can use Autofill to automatically fill in parts of our tax return based on information slips that have been filed with the CRA.
- Print and Mail. You can also use software to print and mail your return if certain restrictions prevent you from using NetFile.
- Professional Tax Preparation. An accounting firm can also prepare and file your taxes and ensure that your forms are filled out properly and that your receive your income quickly.
Although it is recommended that you use tax software to file your return (this ensures accuracy and a quick refund), you can also file manually. This involves acquiring a package of tax forms, filling them out, including all information slips, and mailing them to the CRA.
How to Receive Your Payment
You can receive your payment via direct deposit as long as you set up your account as such. This puts your refund straight into your bank account as soon as possible.
Plus, if you receive payments such as GST refunds or CCB (Canada Child Benefit), these payments go directly into your account as well.
If nothing shows up in your bank account after the two-week time frame, you can always check the status of your return through CRA’s My Account website. To do so, you will need your social insurance number, date of birth, and the amount of total income entered on line 150 of your tax return from the previous year.
What Do I Do if I Owe Money to the CRA?
Knowing tax deadlines is important not only in filing as early as possible but also to avoid interest and penalties on amounts owing. Even if you are not getting a refund, it’s helpful in knowing how much you owe as soon as possible.
Penalties and Interest
If for some reason you don’t think you can pay your taxes by the date they are due because of circumstances beyond your control, the CRA may waive penalties and interest. These types of circumstances include serious illness, accident, death of a family member, financial hardship, and natural/human-made disaster.
It may also be possible to set up a payment plan with the CRA where you pay the owing balance in installments. However, if you miss the set installment payment due date, you may need to pay installment interest.
Otherwise, if you file late and don’t pay the amount owing in time, you could face a late-filing penalty of 5% of the balance owing plus 1% of the balance owing each month your payment is late.
How to Make a Payment
When you owe money on your taxes, you have to make your payments to the CRA. This can be done using a number of methods:
- Online Banking: You can make a payment directly through your financial institution although the specific steps involved can vary from bank to bank.
- Financial Institution: If you don’t use online banking and want to make the payment in person, you can do so at your bank. However, you will need a remittance form and must contact the CRA directly to receive one (they cannot be printed from the CRA website).
- CRA’s My Payment: The CRA website has an online payment service called My Payment. There is no fee to use this service and you don’t need to be registered for any of the CRA’s other online services. You do, however, need a debit card (Visa, Mastercard, etc.) to set up the payment.
- Credit Card: You can make payments with a credit card but these have to be done through a third-party provider (PaySimply and Plastiq) and cannot be made directly to the CRA. There is a fee to use this service.
- Pre-Authorized Debit: You can authorize the CRA to debit your account for the amount of taxes owed on dates you specified – this method of payment is best suited if you are paying your owing balance in installments.
- Cash/Debit: It is possible to pay for your taxes in cash or by using a debit card by visiting a Canada Post outlet. You will need a self-generated QR (quick response) code found on the CRA website.
Keep in mind that some forms of payment take time to process and may arrive at the CRA after the due date. This is why it’s a good idea to file your taxes early so you can make a payment on the owing balance as soon as possible.
Filing Your Taxes Early
As long as you have received all of the necessary paperwork to file your taxes correctly, there’s no need to wait until the deadline!
Filing early means that you will receive your refund quickly or have more time to sort out paying back taxes you owe.
Want to speed up the process? Our accountants at Liu & Associates can file your taxes to ensure accuracy and a fast return.