Filing Your First Tax Return in Canada: Free Resources for Newcomers
One of the early signs of spring in Canada is tax season! Most Canadian income tax and benefit returns for 2016 are due on April 30, 2017.
Newcomers, including refugees, are required to file a tax return with the Canada Revenue Agency (CRA) even if they have only been in the country for a few months and may not have worked yet.
"At your service: Tax preparation services complete returns for millions of confused Canadians each year." 1981 Toronto Star Photograph Archive, Toronto Public Library
Many of the benefits we enjoy in Canada are funded through our taxes. Canada's tax system pays for roads, schools, health care, social security, public safety and immigration services for newcomers etc.
Taxes can be complicated for most Canadians. And while filing your first tax return is an important step in your newcomer's life in Canada, there are so many new terms and procedures to understand – T1, T4, payroll, SIN, RRSP, GST/HST credit, child tax benefit, notice of assessment, etc...
I still remember the day I prepared my first tax return in Canada a few years ago. I had only earned a very small income in my early days in Toronto, so I wasn't sure whether I should still file a tax return. I found all the new terminology and the paper form overwhelming. Luckily, I was able to make an appointment with a volunteer accountant at one of the free tax clinics (see more below) that Toronto Public Library offers every year around this time of the year – March-April. So I was relieved when I got help and was able to get my tax credits very soon!
"Many taxpayers need assistance with their 1972 tax returns". 1973 Toronto Star Photograph Archive, Toronto Public Library.
You can file your tax return with the Canada Revenue Agency by Internet or by mail. As of February 1, 2017, you can pick up a paper tax package from any post office or find it online. Millions of Canadians file their tax returns electronically. To file online, you need your social insurance number (SIN), birth date, income tax information and access to certified software. The CRA provides a list of software options at www.cra.gc.ca/netfilesoftware including some that are free for everyone.
Below are some helpful videos, articles and free services that you can use to learn more about the Canadian tax system and your responsibilities and to help you file your first tax return:
- Video guide for newcomers by the Canadian Revenue Agency: Newcomers to Canada and the Canadian Tax System. There are eight episodes, each one is only several minutes long. It is best to watch them in sequence. The program explains the basics and the steps for filing a tax return for the first time. "It applies only for the first tax year that you are a new resident of Canada for income tax purposes. After your first tax year in Canada, you are no longer considered a newcomer for income tax purposes."
Episode 6 "Your first income tax and benefit return"
- Download brochure T4055 Newcomers to Canada: If you left another country to settle in Canada in 2016, this pamphlet will introduce you to the Canadian tax system and help you to complete your first income tax and benefit return as a resident of Canada.
- Free tax clinics: If you cannot afford to pay for tax preparation services, you may be eligible for a free tax clinic as part of the CRA community volunteer income tax program all across Canada. These clinics are for people who have a low income and simple tax situation. To find a volunteer tax preparation clinic near you, go to www.cra-arc.gc.ca/volunteer.
Free Income Tax Clinics at Toronto Public Library 2017 – check out this library blog for detailed information on the numerous free tax clinics hosted at library branches every year. In March-April 2017, all these library branches below offer free tax clinics for eligible low-income residents. These Income Tax Clinics are available by appointment if you are eligible. A valid Social Insurance Number is required.
Albert Campbell, Barbara Frum, Cedarbrae, Dawes Road, Eatonville, Evelyn Gregory, Fairview, Flemingdon Park, Highland Creek, Jane/Dundas, Kennedy/Eglinton, Main Street, Malvern, Maryvale, Parliament Street, Sanderson, Scarborough Civic Centre, Toronto Reference Library, York Woods.
You can also check with your nearest Toronto Public Library Library Settlement Partnership worker for assistance. There are 13 library branches that offer this free settlement information service.
- Frequently Asked Questions for Individuals from the Canadian Revenue Agency - information and answers about tax rates and how to file your return. From the CRA.
- Ontario Tax Credits and Benefits - Learn about the different tax credits and benefits you can get to help you with living costs when you file your income tax return. From the Ministry of Finance.
- Stay organized all year: It is not that difficult. I start a new tax return file every calendar year and store there all the receipts that I would need for my next year's tax return - charitable donations, daycare expenses, memberships etc. Keep all receipts and documents for at least six years after you file your return. If the CRA chooses to review your return, you will need to submit your receipts to support your claims.
Canadian Tax Checklist by H&R Block, November 2016.
Filing your first tax return as a new resident may seem complicated. But there is support and resources to help you out. Happy spring in Canada!