Do you use tax software to file your taxes yourself? Or do you prefer to let an accountant crunch the numbers? Either way, here are six tools that will streamline your CRA Tax Return process.
Fortunately, you don't need to be a CPA to figure out how much you'll owe the government come April 30. In fact, there are a number of tools and applications you can use to track your expenses and figure out how much you should set aside for your taxes if you run your own business. Here are a few of our favourites.
If you're a freelancer or small business owner, you should know that you can deduct almost any business expense. To do this, you're going to need a comprehensive system to keep track of your receipts. The trouble is, paper receipts tend to fade over time, rendering them practically useless! To prevent this issue, use an app like Office Lens or Evernote to take photos of your receipts, which you can refer to later. Pro tip: keep a receipt folder on your computer's desktop to avoid cluttering your phone.
Your time is worth money. This is especially true if you're self-employed. That's why you should lean on tools that can automate important, yet tedious tasks. A mileage tracking app like MileIQ is a great example. It automatically tracks and logs your miles for you so you can get tax relief for your business miles. Use this data for your professional expense reports and tax return. If you're a freelancer, you can also refer to the app for personal income tax purposes. The app also lets you distinguish personal drives from professional ones or distances. If you're a freelancer, you can also refer to the app for personal income tax purposes. The app also lets you distinguish personal drives from professional ones, or distances travelled for medical purposes.
If you're on the cusp of the next lower income tax bracket, consider contributing a little bit more to your RRSP next year. Doing so could bump you into a lower tax bracket and save you thousands of dollars. Canadian income tax brackets are available from. Residents of Quebec can also refer to this table from Revenu Quebec.
Although I'm a freelancer, I sometimes take in-house contract jobs. This usually causes me to wonder, how much of my hourly rate will I actually see come payday? Online calculators such as this one created by Easy Tax Canada can help you get answers. If your employer is withholding less than what you should be paying, make sure to save a little extra for your taxes at the end of the year.
Even if you love your job, you probably don't want to be doing it forever. Canada's RRSP program doesn't just help you save for retirement, it can also help you save on your taxes. To figure out how much your RRSP account might be worth over time, check out this calculator by Get Smart About Money. Finally, remember to make your next RRSP contributions before the beginning of March to save money on this year's income tax return!