Overpaying Taxes? File Returns to Reduce Tax Withholdings

CRA has issued a new form T1213 ó Request to Reduce Tax Deductions at Source, which is used to request a reduction of taxes withheld from a lump sum or salary. This is particularly important for those who expect to have tax deductions like RRSP contributions, child care expenses, tax deductible spousal support payments, employment expenses like auto expenses, home office or cost of an assistant, costs associated with your investments like interest on your investment loans, also known as carrying charges or other significant tax deductible costs like moving expenses, medical expenses or charitable donations.

To use this opportunity, taxpayers must have submitted all tax returns that are due to be filed. Now is a good time to review errors and omissions on prior filed returns, as the statute of limitations for tax year 2000 will end on December 31. Bringing those files up to date and requesting a reduction in tax withholdings, could increase cash flow before year end to help provide new money for RRSP contributions and other tax wise investments like TFSA deposits The new form is available now in EverGreen Explanatory Notes.