Bonjour mon cher blog.
It has been a while since I last posted in here (concentrating on my TTC blog now). I miss sharing our Canada journey but since I am already here my posts on this blog will only concentrate on our first time like this and like that.
On this note, I am happy to share that after getting our diploma last year, our PR cards, our journey to the maple leaf has leveled up. We got promoted to filing our respective Income Tax Returns, the Canadian way (smiley), with the Canada Revenue Agency (CRA). Maybe it is just me but the feeling is really amazing especially when coming here to Canada has not completely sink in unto my system even if we are nearing our first year.
Anyway, on my previous posts, I have talked about me studying Level I of Canada's Federal Income Tax Return with H&R Block last year and, since January this year, I started working with them on a seasonal contract at their Sears kiosk. Meaning only for tax season which is from January to May 1, 2017. This also entitles me to file my return and that of my husband for free. See my smiley ID below, LOL, this also gives me 10-15% discount when we purchase with Sears (smiley).
Thus, 2 weeks ago, after receiving our Statement of Remuneration Paid (T4) slips, I eagerly entered our details on H&R Block's system and it says we both have a refund which totals to more than a thousand dollar. It usually is the case when you file the first time. Also, as immigrants and first time filers, you need to know your world income and your date of landing so you will know what to fill up under the "Non-residents, immigrants and emigrants" portion. In our case, and this is for 2016 purposes only, there is a portion there where you will be ask for your income in Canada (this will be dependent on your T4s) and world income (your 2016 income outside Canada during your non-residency period). I made sure that what is entered in our GST/HST application is the same to that of our return, so keep a file of the GST/HST form or Child Care Benefit for those with kids.
In addition, the Federal Government (including Provincial Government) has allotted personal tax credits that is allowed as a deduction in calculating your federal tax liability. I will not go through with this detail but when it is your time to file tax, you will know. I just want to point out that, being an immigrant and first time filer, our personal tax credits will be pro rated depending on your date of landing. In our case, for example, the basic personal amount for each taxpayer for 2016 is at $11,474.00 regardless of your income/tax bracket but ours is at a pro rated amount of $7,618.00 because we landed in Canada on 3 May 2016. This will apply to other personal tax credits but like I have said I will not go through with the details so as not to confuse anyone.
Anyway, going back to T4, you will receive this slip when you work here in Canada and is given to you by your employer on or before every 28th day of February each year regardless if you are still working with them or not. They usually come in your mailbox. Below is a sample of the slip:
One tip I wanted to share, especially if you are working part time, see to it that you have an income tax deducted on your payslips. Employers will usually deduct only on your Canada Pension Plan (CPP) contribution and Employment Insurance (EI) premium but little to nothing on your income tax. This will help you when you are ready to file your return. Take for example some of our clients who are filing their return, they will usually ask "why I have little refund" or the worst question "why do I owe CRA", then you go to their T4, you will see that their employer deducted a small amount or nothing at all on their income tax (this is just one factor). In my case, I am a permanent part time with UPS, my income tax deduction is so small compared to the income I received, thus, I called our HR to request for an increase of $10.00 per pay on my income tax. Your HR will know what form they will give you and you can choose to have your income tax deduction increase to $5.00, $10.00, $15.00 or $20.00. For full time employees, just see to it that you are properly deducted with your income tax. It is better to pay more income tax every payday than be surprised with a one time, big time balance owing in the tax season. I am okay with little refund or even zero but with a balance owing, oh no, that is a different story.
In addition, keep with you any medical expense receipts (meaning not covered by insurance and is an out-of-pocket expenses by you), a month bus pass transit, donations, fitness receipts (soccer, swimming, etc. of your child) and arts receipts (music lesson, etc. of your child), these will all help in your taxes. Also, tuition fees, like mine, with H&R Block. Note, though, that they are planning to abolish fitness and arts amount but I added them on the list for the purpose of this 2016 tax return.
Okay, so much so with the tips. I hope I did not confuse anyone. Anyway, going back on our return, I was told that since we are new immigrants here, the filing will be on paper base (meaning for mailing to CRA) to which we did 2 weeks ago via H&R. This will also mean we have to wait for 6-8 weeks wait before we receive our refund. However, just last week when I reported for work, H&R e-filed our tax returns, awesome, meaning electronically delivered directly to CRA. Thus, waiting game will only be in 7 days to 2 weeks and we have registered for a direct deposit on our bank account. This means that CRA will directly deposit our refund to our bank account rather than waiting for a check in the mailbox. This is what happen in our GST/HST as posted in my previous blog.
With our tax returns already filed, we can now open a Registered Retirement Savings Plan (RRSP) with our bank. It is good to save money on our RRSP so we can use them once we retire and, also, it will help on our tax. Adding to the filed return, I also cannot wait to register with CRA soon. In Canada, whatever slips you receive, CRA is very good in their filing system and take note, all is online. We just need to register an account with them, and viola, you can all view slips, statements, even notice of assessments (they do randomly assess taxpayers, so keep your receipts with you and other important documents) and others.
You really cannot escape with your tax here, I hope they do this to in my home country, LOL. Don't get me wrong fellow Filipinos but I know you know what I mean. In here, I am okay to pay my taxes because I know I am benefiting with it. Take for example on our infertility medication, my husband and I has been going in and out the hospital and clinic since September 2016. My husband underwent a surgery in January and I, myself, has been through so many procedures (in fact, I have 2 procedures next week) but we paid nothing, as in zero, with all of them. Our NB medicare covered them all. We still did not use our employer's health insurance except with my medicines (Manulife pays 80% of it and we pay the remaining 20%). Unbelievable it may seem but this is one of the so many benefits Canada through our taxes.
Until my next blog. For now, the journey continues until we achieve our Canadian dream...our little R.
