It’s time to file your tax return. Are you ready? I can remember sitting at the kitchen table while my dad used his new magical device, also known as a calculator, to figure out his taxes. We’ve come a long way since those days. Many money management tools are readily available to help you get through tax time.
The first question is who should prepare your taxes? Is your situation fairly straightforward in which case you could prepare your own taxes? Or is it complicated due to income from rental property, the operation of a small business or other intricate tax issues.
If you are comfortable using a computer there are many software packages available to help you prepare and file your return. Did you know that last year 82% of individuals filed their tax returns online?
CRA certified online software programs that are free include Simple Tax, Adv Tax and TurboTax Free. Simple Tax is an online software designed by a team from across Canada. It has been referred to as an award winning, pay what you want tax software. After you have submitted your return to the CRA, Simple Tax asks if you would like to support them. You can pay whatever amount you want, including zero.
CRA certified free desktop software includes Studio Tax, Genu Tax Standard and TurboTax Free. Desktop programs are the most secure as you download them onto your own computer and unlike online applications you don’t have to trust a third party with the security of your valuable personal information. Studio Tax is twelve years old and is the pioneer of free tax software in Canada. Upon completion of your return you are asked to consider making a donation if you found the program useful.
The tax software programs work by leading you through a series of simple, easy to understand questions that assist you in claiming appropriate deductions and credits. So now that you have the tools to manage your money, what’s holding you back? You need to consider if you have both the time and the patience to prepare your own taxes. The software programs simplify the task but there will still be a learning curve that requires an investment of your time.
If you decide to have your taxes done by a professional you will need to plan for this expense in your budget. Hiring a tax preparer is definitely not free but a good tax professional will also help you find the deductions that apply to you and possibly save you money. Look for someone that can help you with your tax planning. Someone that doesn’t just input your data but rather takes the time to understand your personal circumstances, asks you a lot of questions and helps you plan for the future.
Some tax preparation companies offer what they call an “instant tax rebate”. Don’t be fooled by the name as this is really a high interest loan against your anticipated refund. You will get funds today from the tax preparation company but once the government sends your actual refund you will need to repay the “instant tax rebate” plus interest.
