Canadian Personal Finance Blog

Archive for April 15th, 2009

April 30th (Canadian Income Tax deadline (CRA)) is starting to loom on the event horizon and for me that means paying a hefty 5 figure Income Tax bill (due to my severance payment not being taxed at the correct level). This will (hopefully) be the largest tax over-payment I need to make in my life (but who knows).  

Since I owe the government money I have filed my tax return, but I am waiting to make my payment until the end of the month (no point in giving the government any extra funds), which I will do using my Bank’s Direct Bill Payment capability.

Due to this very large bill, I have managed to find and work as many deduction and tax credit areas as I can legally think of (aside from claiming my cats as dependants, which is in the illegal side of the equation).

Some of the more important areas that I was able to take advantage of:

1. Soaking up all remaining RRSP room that I had to lower my tax payment (along with the allowance given to me for having worked for the same company between ‘85 and ‘94).
2. Ensuring I transfer over my daughter’s tuition fee deduction (she did not need it).
3. Mass transit tax credit, using the bus passes I buy my daughters to lower my taxes
4. Active Children tax credit, for two of my daughters
5. Safety Deposit box rental as a carrying charge
6. Making sure I have all of my Charitable Donations in place
7. Filling in my tax forms correctly, thanks to Quicktax (I am sure UFile would have done the same)

These and other important tax deductions and credits have helped soften a large blow to someone with no income for now either.

However, as all of these stories go, there are people worse off than I am:

1. Former co-workers who got no severance, so I am not complaining about paying a lot of tax, because it means I did get some money.
2. Other folks due to circumstance who are going to owe much more than me (see Michael James post on Phantom Income Strikes). 

Remember when you pay that big tax bill there are others worse off, so calm down and get it done, April 30th is not that far away!