Income Tax: Incompetance is expensive

So whilst I blunder through my Tax Return I keep finding interesting mistakes, and omissions that could either have got me in trouble with the CRA (which is bad) or cost me a great deal of money (much worse). 

Fill in the Right Form!

I received a T4A as part of my severance package from my former employer, and assuming that since this was from the pension aspect of things, I filled in the T4OAS form in QuickTax , um, BIG mistake there. That mistake seemed to cause a cascade of charges that raised my taxes by a great deal, I have remedied that issue, and will watch diligently to ensure the same mistake is not made again.

Don’t Forget UCCB

Remember your “Beer and Popcorn” money, and remember to declare it! In my case it didn’t change my wife’s taxes, but it did change mine a little, so don’t forget that, or our friends at the CRA might have something to talk to you about.

All Your Tax Forms?

My former employer seems to have different money piles, and last year I moved from one payment group to another, so in fact, I am supposed to receive TWO (2) different T4′s for getting paid by these two different (yet the same) money piles. Important to make sure you have ALL of your forms.

I also went rummaging through my paper heap (also known as my desk) and found two more charitable donation forms and an RRSP donation I had forgotten about (which saved me lots more money), so make sure you have ALL your documentation as well.

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Money for Nothing OK, 0.5%

The Bank of Canada, did as promised and slashed their overnight rate to 0.5%, which is unheard of in modern times. An interesting item from the press release:

The effects of the recent aggressive monetary and fiscal policy actions in Canada and other major economies will begin to be felt in the second half of this year and will build through 2010. Once the global financial system stabilizes and global growth recovers, the underlying strength of the Canadian economy and financial sector should ensure a more rapid recovery in Canada than in most other industrialized economies.

Once everything stabilizes we should all be fine.  A rapid recovery in Canada, interesting thought, I am not sure I subscribe to this concept, but again, talk to me in a year and we’ll see if this is a good or bad prognostication.

Some banks are already dropping their rates by 0.5% as well, thus it is even cheaper to borrow money, in Canada.

{ 3 comments }

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  • Dat To March 4, 2009, 1:17 PM

    Lowing rates for more ‘free’ money is supposed to help people not be afraid and keep spending? How much debt is an average household in? Can the government help in that area? Can they lower taxes?

    Reply
  • Investor Trip March 4, 2009, 6:29 AM

    Maybe you should file for an extension if available. I’ve got until April, but my CPA is swamped with paperwork so I might file for a 6 month extension. Usually, I can fight the penalties plus receive more tax deductions in the process.

    Reply

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