Advice For The Tardy: Newsletter April 30, 2021

Hello All,

Today is a stressful day for accountants all over Canada as it is the deadline for individual taxpayers, who do not have small business income, to file their tax returns. Taxpayers who do their own tax returns (and have not yet filed) are also feeling the pressure. If it is of any comfort to anyone, I only filed my tax return on Wednesday so I empathize with all of you who have left it to the last minute.

If you have filed your taxes already, you should go ahead and give yourself a big pat on the back! Conversely, if you are one of the many who have procrastinated, and you feel like there is no way you are going to be able to submit your tax return by end of today, you should try to at least pay an estimate of what you think you owe to CRA. Late filers are charged a penalty on what they owe, so if you reduce this amount you can correspondingly reduce or avoid penalties altogether. Same goes for interest. As mentioned previously, Revenue Quebec has generously extended the deadline to May 31st so if you are unable to file and you are a Quebec resident, you can pay CRA first.

If you have small business income, your deadline is June 15th so you still have some breathing room. However, it should be noted that CRA will start charging you interest on May 1st on the amounts that you owe. So, my advice is the same - if you can make a payment to reduce your taxes payable and corresponding interest, you should go ahead and do so. Generally, small business owners have higher amounts of tax to pay since they don’t have an employer that takes deductions directly from their salary.

If you are one of the fortunate few who expect a refund and you are filing late, there won’t be any interest or penalties however child tax, GST and solidarity tax credits will be delayed. Also, the refund that you are expecting can be put to much better use on something shiny.

And of course next year, we will all strive to be much better organized and will file our taxes well before the deadline :)

My blog post this week gives taxpayers some insight into notices of assessment and the dreaded request for information/audit. Most of us will receive a simple NOA which details the line items from our tax returns and indicates an amount payable or refund. A few unlucky taxpayers, who usually have something on their tax return that triggers a red flag (high deductions, credits or expenses or something else that is unusual), will receive a request for information or an audit letter, which might happen a couple of years after you have filed your tax return. In this case, it is really important to deal with this as soon as possible.

Small Business Articles/Tips

More CBC interviews: I suppose I’m the go to tax person on CBC radio which is certainly gratifying. On Wednesday I was both on the morning show in Montreal and the afternoon show in Quebec giving out some last minute tax tips and advice.

The Federal Budget was Released on April 19th : There was a number of notable items including the promise of $10 per day daycare, extension of Covid benefits for individuals and businesses, a new hiring subsidy for businesses and a proposed digital tax on non resident behemoths. A couple of good writeups can be found here and here

QBO Tip : Bank reconciliations in QBO can be fairly straightforward if all your transactions are downloading correctly. You can verify this by going to your banking tab and comparing the balance in bank vs balance in QBO to ensure that they are the same. If not, reconciling them is essential. Fundamentally, every transaction on the bank statement should match to the same transaction in QBO. If there are missing transactions or transactions that appear on one and not the other, it means that there is a discrepancy in your books. As such, it is important to match each transaction and ensure that they balance. I will be writing a post on this in the near future so please email me if there is anything specific you are having trouble with and I will address it in the article.

Products

A standing thank you to everyone who has purchased my ebooks. I really appreciate it and sincerely hope they have been useful. I would love to hear your comments!

Note: All books are on sale today plus you can use the discount code below

NEW: Small Business Tax Guide: My comprehensive guide to doing your own small business/self employed taxes is now available. If you are doing your own tax return or simply want to understand how your small business taxes works, my guide explains everything as simply as possible and provides somewhat entertaining examples.

Small Business and Your Dividends: For those of you who are doing it yourself, and have not had time to file your dividends, this book helps you understand exactly how dividends work and how to submit them to the government. There is also a free dividend checklist that you can download here.

Start Your Business: If you are planning to start a business, or have sort of fallen into your business but now want to make sure that you haven’t missed anything, my book explores what every business owner needs to evaluate from a regulatory, financial and tax perspective.

All three books are also available at Amazon.

Discount: Save 25% on either guide by using the discount code “special”.

Reviews/Feedback

I have created a feedback form for anyone who would like to provide their insights into existing blog posts, topic ideas for new blogs, feedback on my products/website or anything else. I’m always looking for ways to improve or provide value (to the extent possible) and this will be most helpful.

For anyone who has purchased my books through Amazon, and have found it valuable, a review would be hugely appreciated.

Thank you to my new subscribers and of course my current subscribers. I really appreciate you guys and I look forward to hearing from you.

Hope everyone has a fantastic weekend!

Ronika