At TurboTax, we think about taxes all year – but you probably don’t. For many, this can mean getting organized at tax time is a big challenge. For others, it may mean missing out on deductions that could help you get a bigger refund. There are many things you can start doing now that will positively impact your tax return next year. Here’s a list of ways you can help boost next year’s tax return and get a bigger a refund.
1. Tracking Deductions
Did you know there are more than 400 credits and deductions available to Canadian taxpayers? It’s worth the time and effort to find out which of these you can take advantage of. The simplest way to keep track of these deductions is to prepare a file, label it accordingly, and use it store records of deductions such as medical expenses, donations, business expenses, tuition costs, and others. There are several apps out there that can now help you do this. For small businesses, QuickBooks Self-Employed is a great tool for keeping track all these receipts.
2. RRSP Contributions
The RRSP deadline is usually around March 1, and you can find how much you’re allowed to contribute on your Notice of Assessment. When you contribute to your RRSP, you’ll be able to receive a tax refund, that you can later use for things like contributing to your TFSA or paying down an outstanding debt.
3. Student Loan Interest
There is a silver lining to all those tuition fees you’re paying – you may be able to claim the interest that you are charged on your student loan.
4. Charitable Donations
As long as the charity is registered, your charitable donations are tax deductible. You’ll have to make sure that the receipts have particular details on them, such as registration number, name, and address amongst others.
5. Moving Expenses
If you had to move for a new job or to take courses as a full-time student, then you may be eligible to deduct your moving expenses from your tax claim. In order to qualify for this deduction, your move must have been at least 40 kilometres closer to your new job or school. Moving expenses aren’t just limited to the cost of the movers, other expenses that may be deductible include:
- Fees for the costs of selling a house, such as agent and legal fees, advertising, and mortgage penalties;
- Travel expenses to the new location, including vehicle expenses, meals and accommodations for you and your family members are all eligible. To claim vehicle or meal expenses, you must use either the detailed or simplified method.
- Temporary living expenses (for up to a maximum of 15 days), including meals and accommodations for you and your family, can be deducted.
- Costs of cancelling a lease of your old residence and costs to maintain your old residence (maximum of $5,000) when it was vacant after you moved are also eligible.
- Incidental costs, such as changing your address on legal documents, replacing drivers licenses, vehicle permits, and utility hookup and disconnections are deductible as long as they are related to the move.
Using a trusted tax software, like TurboTax, can help you maximize your refund by walking you through your taxes step-by-step and automatically searching through all available credits so you never miss out.