Tax Tip for the Month
Why fill out a tax return if you have no taxable income for 2010?
By filing a tax return, you might be eligible for the Goods & Services/Harmonized Sales Tax Credit. Low-income seniors can also re-apply for the Guaranteed Income Supplement and Alberta Seniors Benefit. In addition, you will be able to recover any money owing to you for the year, such as an overpayment of income taxes, Canada Pension Plan contributions (CPP), or Employment Insurance premiums.
Even if you have no “taxable income”, you might still be required to file a tax return and pay CPP if your net self-employed income is in excess of $3,500. You might also want to report this “earned income” so that you build your RRSP contribution room and become eligible for greater RRSP deductions in a future year. If you are a student with excess tuition and education amounts in the year, you will want to file a tax return so that you can carry them forward to another year. Also, if you have a business loss, you must file a return in order to establish your right to claim the loss in other years.
If you are a non-resident and your tax return was filed more than three years after the end of the taxation year, the Canada Revenue Agency might not issue a tax refund related to that return.
Lastly, by filing a tax return, if you are 18 years or older, you will earn Tax Free Savings Account contribution room of $5,000. These accounts were introduced in 2009 and the Canada Revenue Agency plans to track contribution room only for those eligible individuals who file personal tax returns.
Tax credits, money owing- it’s yours for the asking. Simply fill out a tax return
