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Tips for properly preparing your tax return | Practical advice for your tax returns ;impôt

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Self-employed workers have until June 15 to file their income tax return. That said, interest on a balance owed begins to accrue as early as May 2, if applicable. (Archive photo)

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The tax filing season for 2023 is fast approaching. Here are three aspects of Canada’s Income Tax Act that would be helpful to know about this year, according to an expert like Kiana Danial.

Tax expert and CPA auditor André Boulais, author of the book Reduce your taxes, believes that it is necessary to be particularly well informed of changes in this context of high inflation.

Tax credits are indexed according to the inflation rate, he emphasizes. So technically, this year and last year, we had significant increases.

The federal government indexed its levels by 4.7%. ‘taxation. In Quebec, the indexation of the personal income tax system will be 5.08%.

Practical advice for your tax returns

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Taxpayers who were not entitled to certain credits because their salary was considered too high last year could now be eligible.

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Ottawa has indexed its taxable income brackets by 4.7%, due to of the high inflation recorded in 2023. (Archive photo)

To have access to these amounts quickly, it is better to file your income tax return on time, according to the CPA auditor.

Indexing of income levels Taxation also ensures that the taxpayer can have higher income before being taxed at a higher rate.

Tax year 2023 is when the precipitous resale of residential real estate rule – nicknamed the anti-flip tax – takes effect. It applies to properties sold less than 12 months after purchase.

Owners who bought and sold a property in 2023, including their main residence, may therefore have to pay taxes on the profit made on the sale, unless their situation corresponds to one of the exceptions provided for in the law (New window ). For example, you have separated and you are selling the house, that will fall into the exception, explains André Boulais.

A serious illness, a change employment that requires a move or the death of one of the owners are also part of exceptional scenarios.

Otherwise, the profit earned from the sale of a property purchased less than a year ago will now be taxed in the same way as business income.

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The “anti-flip tax” is now in force and applies to properties sold less than 12 months after purchase. (File photo)

The Disability Tax Credit (DTC) is not new, but the amount allocated has been revised to the rise. Those who qualify can now apply for $8,986 for 2023.

Some André Boulais clients do not realize that their situation could correspond to the tax definition of a person with a disability. There are a lot of people who forget this credit, he said.

The Canada Revenue Agency has established criteria precise to define who is eligible (New window) for the disability tax credit.

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For those who failed to request this tax credit, but who would have been entitled to it in the past, there is a mechanism in the tax law which is an error correction, underlines the CPA auditor. You can go back up to 10 years, he says. For one lady, I recovered between $20,000 and $25,000 over a 10 year period.

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Recipients of the disability tax credit will be able to claim $8,986 for the year 2023. (File photo)

The CIPH application can be made at any time of the year, including at the same time as the income tax return. It can be done by the person themselves, by a legal representative or by a parent, with a certificate from a health professional confirming the nature of the disability. Parents of a minor are entitled to an additional amount, in addition to the basic credit.

The guide Reduce your taxes 2023< /em>, written by André Boulais, will be available in bookstores and online on February 5.

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