22.6 C
New York
Saturday, July 20, 2024

2023 tax return: What you ought to be doing proper now

Tax skilled Jamie Golombek presents tips about CRA deadlines and adjustments

Article content material

Tax season is quick approaching, however there are some things you ought to be doing proper now to get a head begin.

Crucial factor, tax skilled Jamie Golombek stated, is to know your Registered Retirement Financial savings Plan (RRSP) contribution restrict.

Article content material

The managing director of tax and property planning at CIBC Personal Wealth Administration stated being conscious of your restrict is vital because the deadline to assert an RRSP deduction in your 2023 tax return is Feb. 29. Canadians can nonetheless contribute to their RRSPs after that deadline, however they gained’t have the ability to declare the deduction till their 2024 tax return.

Commercial 2

Article content material

The best solution to discover out your contribution restrict is to take a look at the discover of evaluation to your 2022 tax return. In case you don’t have that, you’ll be able to log into your account on the Canada Income Company’s web site.

“I’m a giant fan of RRSPs,” Golombek stated in a current interview with the Monetary Publish’s Larysa Harapyn. “An RRSP continues to be the best solution to save for retirement.”

He stated most Canadians ought to maximize their RRSP contributions, however that doesn’t imply they need to take out a mortgage to take action. A mortgage on this case solely is sensible in “very restricted and uncommon conditions” the place you’ll be able to repay most, if not all, of it inside a couple of months, similar to when you recognize you’ll quickly be getting a bonus, further money or huge tax refund.

“The issue is should you can’t afford to pay it again, and this drags on for months, it turns into a really, very costly solution to make an RRSP contribution,” Golombek stated.

Canadians who’ve been working from dwelling on a full-time or hybrid foundation also needs to get a head begin on determining their home-office bills earlier than the April 30 tax submitting deadline. That’s as a result of the CRA’s simplified methodology of claiming work-from-home bills is not obtainable for the 2023 tax 12 months.

Commercial 3

Article content material

Between 2020 to 2022, workers have been allowed to assert $2 per day for each day they labored from dwelling, as much as a most of $500. Now, workers shall be required to tally up and prorate their bills earlier than claiming the ensuing quantity as a deduction. Workers can even want a duplicate of kind T2200 from their employer.

Advisable from Editorial

In case you owe the CRA cash, it’s extra important “now than ever earlier than within the final 20 years” to pay the excellent steadiness by April 30, Golombek stated. That’s as a result of the CRA’s prescribed rate of interest for overdue or late taxes has hit 10 per cent for the primary time since mid-2001.

“For somebody in a high tax bracket of fifty per cent or extra, you’d need to earn a price of return of over 20 per cent on an equal funding to be higher off than not paying your tax debt,” he stated.

• Electronic mail: novid@postmedia.com

Article content material

Oh hi there 👋
It’s nice to meet you.

Sign up to receive awesome content in your inbox, every month.

We don’t spam! Read our [link]privacy policy[/link] for more info.

Related Articles



Please enter your comment!
Please enter your name here

Latest Articles