Income Tax

$ 29 Billion in Arears ?

by bigcajunman on May 1, 2013

That is how much is owed to the CRA which is a real big number ( according to the Auditor General ) in fact the report actually states:

Michael Ferguson, Canada’s Current Auditor General

The outstanding balance in undisputed unpaid taxes was $29 billion at 31 March 2012. Each year, the Agency writes off a certain amount of debt that it considers uncollectible (sic). In 2011-12, it wrote off $2.8 billion.

Wow, that could wipe out the Federal Deficit, cool! So if the CRA hired a bunch of collection agencies I wonder how much they could actually recuperate ? Could they sell the debt to a collection agency? Even at a 90% discount they’d make almost $3 Billion which isn’t chump change.

This number is completely synthetic really, and will only be traipsed out during the next election or used for political fodder, but it still is an interesting number to think about. Think if they are charging 5% penalty fees, how much more money they could make.

Have a look at the Auditor General’s report it’s a very interesting read. You can even follow the Office of the Auditor General on Twitter as well!

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Tax Day 2013

by bigcajunman on April 30, 2013

Yes it’s that time again. Time to file your taxes, and you have the rest of the day to finish this task.

You don’t need a special NETFILE number any more to use this facility, you only need your SIN and your birthday and away you go, so you really should get moving on this.

I know a few people saying, “I don’t owe money, so I don’t have to rush”, and you may think that is the case, but are you sure you don’t owe money? If you haven’t done your taxes yet how can you be so sure you don’t owe money? If you do owe money and don’t file, that is when penalties start kicking in (and yes the CRA does go after folks who owe and don’t file, if you don’t believe me check their Twitter Feed for examples).

For those who owe money but don’t want to pay until the last day, here is a friendly reminder that, Today is the last day!

The bottom line is get it done today, and next year plan your tax filing better?

And finally a helpful video from Turbotax for all Taxpayers, pointing out the importance of Taxes before the Playoffs:

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Taxes: When Should They Start?

by bigcajunman on March 5, 2013

Mrs. C8j came up with this one, an interesting question too (actually a group of questions):

When should you start filing tax returns for your kids?
When should the kids start doing their own darn taxes?

For us, we started filing tax returns for our kids as soon as they started earning money. They already had their own SIN numbers, so submitting it was not an issue.

The question that arises now is when do I hand over to them their tax files and say, “Go Be Free!” ?

I must admit that doing their taxes while they are at University was an advantage for me, since it was much easier to then transfer their tuition credits to my own tax return, however, eventually they are going to have to figure out how to do it themselves (I suppose). It’s funny that schools never really offer courses on doing your own taxes, not even seminars or the like.

I think Universities and Colleges would do well to teach this, since even with software (I learned on those darn long forms, with pencil and pen) it can get intricate quite quickly (especially if you are carrying tuition credits from University and even more Loan Repayments for school as well).

When is the best age to get kids to do their own taxes, or should the parents just keep doing them until the child asks to do it?

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Things To Do With Your Tax Refund

by bigcajunman on February 27, 2013

Yes, now that you have gone and purchased a bunch of High MER Mutual Funds, for your RRSP, what are you going to do with that big fat tax refund you will be getting?

Leave That Money In Your Wallet not with the CRA!

Some Suggestions:

Buy a vacation that costs 4 times as much as your estimated refund, because you deserve it!
Buy a new honkin Big TV, then forget you’d spent the money and put a down payment on a new car too, finally find another thing, so that you actually spend your refund 3 times over.
Go back in time and adjust your tax payments, so that you have your refund money in your hands during the year and you don’t get a big wad of cash at the end of the year, that you are tempted to blow!

This really does seem to happen a great deal, that folks want to get big rebate cheques from the government, instead of filling in a form with your payroll folks to have less tax collected during the year?

Yes, I do end up with a tax refund, but not a big one, just enough in case I screw up or the day that this site suddenly makes me a fortune (I equate that with a lottery win), of about $1000 (it should really only be $200 as my goal, but I have screwed up a bunch of times on my taxes).

Why do people love big tax refund cheques, if it simply comes from buying RRSPs in February? I suppose it’s better than paying a big chunk of money because you owe, but I just don’t get it.

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Where the Hell is that Receipt?

by bigcajunman on December 12, 2012

So the joy of the Christmas season is always augmented by the need to clean up (or wrap up) your finances by the end of year, and maybe start preparing for the upcoming RRSP and Tax Season (it’s just synonymous Holidays and End of Year (said he dripping with acidic sarcasm)).

Not only can I not find the latest “Tickle me Furby” toy, I can’t find the damn medical receipts from my many physiotherapies for my knee and also all of my god damn bus passes to claim my mass transit credit. The aggravation of the Christmas season grows exponentially when you add in your end of year stuff too. Many a day I end up swearing like a drunken member of the Merchant Marine on his first furlough in a year in Shanghai thanks to Christmas Shopping and End of Year financial close out, but there is more to add.

January is coming? What does January mean for anyone with kids in University? If the school your kids attend has a semestered set up, you owe another $3500 in Tuition Fees too! Let that lump of coal under your tree simmer there for a while, just to make you feel more festive. I know at Christmas I always have a spare $3500 hanging around in my sock drawer (hell these days, I am lucky if I have socks in my sock drawer) (yes I have RESPs to cover some of this, but never interrupt a lunatic mid-rant).

Nothing like a Bloggers Rant to allow me to use the old A-Bomb Picture

How to alleviate this? You really need me to explain this? OK, back to the tried and true advice you have had from me many times, but one more time from the top:

Don’t make financial planning and tax planning an end of year thing, do it every month or at worst every quarter, get it all straight that way December 31st is not a black day on your calendar
Stay organized too, and no a shoebox full of receipts is not organised, that is a paper shite vortex looking for somewhere to hit. File the stuff in a way that it is easy for you to find and figure out where everything is.
Christmas planning? If you didn’t start that in September you are going to feel like a long-tailed cat in a room full of rocking chairs come December. Make a plan and stick to it.

As for me? Yeh, I don’t follow my own advice, do I? Hopefully you do!

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