CALGARY, AB, Mar 6, 2014/ Troy Media/ – Do you prepare you own tax return, or do you hand off an envelope of receipts and T4’s to a professional tax preparer?
Popping your tax return in the mail box – whether it’s the one the corner or the email on your computer – is a healthy financial exercise that can improve your bottom line! But judging by the number of pre-fab tax preparation offices I’ve watched pop up in malls in the last couple of weeks, filing a tax return is a chore many people want to avoid. That’s not surprising.
Filling out our tax return adds yet another ‘to do’ on to our long list of spring chores. So, it’s tempting to hand the job off to staff in that pop-up office at the mall while we head off to get the Saturday shopping done, but leaving the heavy lifting to a stranger at tax time robs us of a chance to build up our own financial muscle, which requires we take on an active lifestyle. That means putting new financial fitness exercises into our schedules.
Schedule enough time to do your own tax return. Pick a few hours when you can be free of interruptions. Allow time for revising calculations, reviewing information in your tax guide, and even a couple of coffee or fresh air breaks. Avoid leaving your tax return time to the last minute if you want to avoid deadline ‘stress.’
Make sure you have the right equipment. Basic equipment includes a couple of pens, a paper scratch pad, and calculator (the one on your phone should work). If you are submitting a paper return, pick up a tax package from Canada Post or download forms from the Canada Revenue Agency. If you’re filing electronically, download e-file software from the CRA or from a private company. H & R Block offers e-filing software which lets you prepare the first return for free. Prices for additional returns start at $9.95.
Start with the warm up. It’s a good idea to read through your tax guide a day or two before you fill out your tax return. While you are at it, gather and organize your receipts, TR4s and T4As.
Make financial fitness fun. Why not put out a few healthy snacks to nibble on while you work? Or listen to some music? Once that return is on its way to the CRA, head out to a movie, take a walk, or buy yourself a cappuccino.
Stay in shape all year long. In December 2013, BMO Nesbitt Burn published a study that indicated Canadians lose money by not thinking about taxes throughout the year.
According the BMO, “The study found that fewer than a quarter of Canadians think about income tax return-related issues prior to the end of the year, while overall, 85 per cent think about these issues by the start of the new year or by the period just before the April filing deadline.”
Doing your own taxes is one way to ensure that you know what receipts to keep, and know how to avoid missing important deadlines for charitable donations, RRSP contributions, quarterly installment payments, TFSA withdrawal, and Tax-loss selling.
The sooner you file your tax return, the sooner you’ll get your refund.
Preparing your own tax return gives you the added benefit of strengthening your financial muscle by helping you understand your tax bill and how to make lower it.
That said, professional tax preparers serve people who are just too swamped to manage the task. If that’s you, don’t feel guilty about stopping at the tax preparation pop-up store on your way to get groceries. There’s always next year.
Jane Harris-Zsovan offers her readers practical money advice for the real world.
Read more Cutting Corners
Follow Cutting Corners via RSS
Download this FREE edited column for your publication or website. 670 words. FREE registration required.
Troy Media Marketplace © 2014 – All Rights Reserved