As the 2025 tax-filing season approaches, individuals are reminded to gather their tax slips and receipts. The official start kicks off on Monday and continues for just over nine weeks, culminating with the April 30 deadline for most taxpayers. Throughout this period, employers typically send out T4 slips by the end of February via various channels including mail, email, or through employee portals. Financial institutions also issue investment slips, while more advanced investment firms provide clients with an annual summary detailing all investments and gains during the same timeframe.
Ryan Minor, director of tax at CPA Canada, advises that if you anticipate owing money to the government, it may be wise to engage in some scenario planning. Contributions to a registered retirement savings plan (RRSP) can assist in reducing your taxable income, contingent on having available contribution room. Taxpayers have until March 2, 2025, to contribute to their RRSPs for that tax year.
Yannick Lemay, a tax specialist at H&R Block, underscores the necessity of familiarizing oneself with the variety of credits and deductions available. Canadians may be eligible for over 400 various credits and deductions at tax time, making it crucial to gather all pertinent documentation since most credits require supporting documents.
According to Minor, missing out on certain tax credits, such as the disability tax credit, is not uncommon. He highlights that individuals have benefitted from reassessments for previous tax years, resulting in refunds when they claimed these credits. It is essential for taxpayers to review their unique situations to identify any credits they may qualify for, including those aimed at first-time homebuyers or home accessibility improvements.
Setting up and reviewing your Canada Revenue Agency (CRA) account is integral in ensuring no vital slips or documents have been overlooked. Minor emphasizes the importance of tracking down any missing slips, particularly if the CRA has a record of documents that you do not possess. The CRA My Account provides access to information related to refunds, credits, appeals, and direct deposit timelines for tax refunds. Even for those not filing immediately, checking that personal information like addresses are current in the system is advisable to allow for corrections before filing.
This tax season will include several changes introduced by the CRA. Notably, taxpayers will no longer have to wait days for a mailed code when opening their CRA account; instead, they can verify their identity utilizing online tools. Charles Drouin, an agency spokesperson, mentioned that a valid photo identification card issued by the government, such as a driver's license, alongside the last tax return filed within the last two years, would be necessary for this online verification.
Furthermore, the agency promotes the use of its new AI-driven chatbot for addressing taxpayer queries. For self-employed individuals, Minor stresses the importance of determining any owed taxes before April 30, despite the extended deadline of June 15 for filing returns. Those who owe money must ensure payment is made by the end of April to avoid accumulating interest, even with the additional time allowed for filing.
As tax season commences, experts advise against rushing to file taxes. Minor mentions that some individuals might not receive all tax slips, such as those related to trusts, until March. Filing early may be appropriate for straightforward cases, such as having a T4 and expecting a refund, but it ultimately depends on having all necessary documents before submission.
This guide serves as a valuable tool for Canadians preparing for the 2025 tax-filing season, highlighting essential deadlines, potential credits, and the importance of thorough preparation.
