Tax Refund Canada: Getting organized
During February to March, it’s time to think about your tax refund Canada.
The tax year in Canada runs from January 1 to December 31, and T4’s, or tax summary documents, are issued from each of your employers in January and February the following year.
The deadline to file your tax return is April 30. Your tax refund for Canada should arrive within eight weeks.
International working holiday visa holders in Canada may not be required by law to file a tax return in their first year, but it is recommended to do so to keep your tax affairs in order and in case you want to return to Canada to work.
You have a number of options when filing your tax return, some of which are listed here:
- Paper filing: Canadian Revenue Agency (CRA) — Paper Filing
- The CRA’s online filing system – NETFILE: Canada Revenue Agency (CRA) — Online Filing
If it is your first time filing a tax return in Canada, you will need to submit a paper return to the CRA. While you may use online software to prepare your return, you will need to print it off and mail it to the CRA. For first time filers, it can take up to 14-16 weeks for the CRA to process your return.
If you would prefer to pay someone to provide this service, you can use services such as H&R Block and TaxBack.com. Turbo Tax provides a free service, but your salary must be under a certain threshold.
Learn more at this article: Tax return Canada: 8 tips to make it easy.
Tax Refund Canada: Do I have to file?
The CRA has a guide for newcomers about their liabilities, and when they become resident in Canada for tax purposes. See it here.
Pay special attention to the credits you can claim. Some of these are now calculated automatically (e.g. the GST/HST tax credit for people on low or modest incomes).
Aside from the legal obligations, it can be worthwhile filing a return in the event that you want to claim a refund.
1. Ensure your employer has an accurate mailing address for you. They’ll be posting out your T4 to you, so make sure it goes to the correct address.
2. File early! If you can file well in advance of the April 30 deadline, you can get any refunds owed to you early too. It also reduces any last-minute stress.
3. Check your eligible deductions. You may be able to knock the costs of rent (in Ontario and Manitoba), public transit, and healthcare expenses off your total annual income, so your assessable income, and therefore your tax liability, is lower.
For example: your income is $40,000. Your eligible deductions come to $2,000. You now only pay tax on an income of $38,000.
4. Ask for help. Newcomers to Canada can receive voluntary assistance in filing a return from the Community Volunteer Income Tax Program.
Tax Refund Canada: How to arrange it
On the Canada Revenue Agency (CRA) website, there is a tax preparation software that is free of charge, with no income limit, no registration required, and no questions asked.
The software can be downloaded at this site:
Taxback offers free estimates, free online accounts, a hassle-free process and refunds are lodged into any account worldwide.
Taxback maximizes refunds for international workers, and their average refund in Canada is $904. If you are from Ireland or the UK, they can also help you file your taxes at home too.
Don’t forget that you can claim travel and medical expenses against your tax, so hold onto your travel passes and medical receipts.
Use the tax refund Canada calculator on the top-right of this page for guidance (mobile users: keep scrolling down until you see ‘Canadian Tax Refund calculator’).
Where to next?
- Thinking of Permanent Residency? Check out our Express Entry guide.
- Know someone who’s looking for work? Visit the Moving2Canada Jobs Board.
The author assumes no liability, directly or indirectly, for the accuracy or completeness of any information provided herein.