If you make claims in your taxes, you’d better back them up. Most claims in taxes require invoices and receipts as backup. Jamie Golombek of the Financial Post had to spend over an hour getting backup (receipts / invoices / evidence) of his home office claims after a CRA audit. Read his Feb 10 article.
You can claim a Home Office Expense Credit for 2021. Details here. Talk to your tax accountant as needed! https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/line-22900-other-employment-expenses/work-space-home-expenses/how-claim.html
The 2020 Tax deadline is approaching on April 30, 2021. Make sure, you do your taxes properly with CERB income and other government (CRB, CESB, CRSB,CRCB) supports. Penalties ~5% and interest may apply if you file and pay late.
This is a short reminder that government support payments are often taxable. Some of the payments send out had no tax deductions, so if you received cash, put some aside for taxes. For the CERB, How much to put aside? As it was at a low-income level, use the lowest rate at 20.5% (federal rate at 15% and provincial 5.05%). So the rule of thumb is put aside 20% of CERB. The CRA-administered CRB, CRSB and CRCB all have 10% withheld at source (they deduct 10% for taxes just like you were an employee). So, put aside 10% of CRB, […]
To prepare for Income Tax, there are basically three themes: Sources of Income. Sources of Deductions (money spent to earn income). Sources of Credits. Make three lists with those titles and you are ready to start! Some things change over time. The New Child Tax Benefit doesn’t pay out as much as the old system did, especially as family income increases. However, it is tax-free (one doesn’t add it to one’s income). Pension income splitting will likely be around for awhile. Family Income Splitting (income splitting when children are present) has been removed by the current government. It may be […]