April 30 Less Than a Week Away

While tax practitioners keep their heads down to finish filing your tax returns, do-it-yourselfers who are procrastinators need to get on it!

The tax filing deadline for most Canadians is midnight April 30; when the clock indicates it’s May 1, a 5% late filing penalty will apply to first time delinquents; it’s 10% if you’ve been late a second time in five years. The interest clock starts clicking, too. 

If you are a self-employed proprietor, you have until midnight June 15 to file to avoid a late filing penalty, but that interest clock starts clicking for you too on May 1 if you owe.

Top three tips for procrastinators:

1. Take it to a tax pro – if you’re busy, and you know you won’t make the deadline, sort your slips and receipts and make that appointment now. If you don’t know of a tax pro, interview three – a T1 tax preparation firm, an independent tax accounting firm, and a CA firm, depending on the complexity of your affairs. Ask your top three most burning tax questions to make sure you can communicate well – your pro should be well versed, up-to-date in knowledge, but also a great educator. That’s part of the fee and you should be able to take advantage to help you think about tax efficiency the rest of the year. Ask about fees, timelines, guarantees of service, and what happens in the case of audit.
    
2. Make arrangements to pay – If you think you’ll owe, gather the funds together now and pay up, or pay what you can. Then make arrangements to pay over time, or extend your operating line. Remember interest is charged at the prescribed rate plus 4%. In the second quarter of 2013 the number is 5%.
    
3. Use your carry over-provisions – Make sure you have reached back to recover taxes paid by applying capital and non-capital loss carry-backs to the returns you filed over the last three years. Also, adjust prior filed returns for errors and omissions; both good ways to recover taxes and help to pay a current tax bill.

Watch Evelyn Jacks discuss the tax filing deadline with Kim Parlee on BNN's Money Talk – click here for the interview.