Taxes for New Canadians: Step-by-Step Guide to Filing Your Tax Return

When do I file my taxes in Canada?

Winter, spring, summer, fall… you might think there are four seasons in Canada. But there’s one more to add: tax season.

For personal taxes, or if you run a business that’s not a corporation, the income tax year matches the calendar year: January 1 to December 31. Then, the following spring, you have to do what’s called “filing your taxes” or “doing your tax return.” This means filling out an income tax return and sending it to the Canada Revenue Agency, or CRA.

Here are some deadlines to pay attention to:

• Personal income tax deadline: The deadline to file personal taxes is April 30. So, for tax year 2023, you’ll have to file by April 30, 2024.
• Self-employment tax deadline: If you or your spouse or common-law partner have self-employment income, your filing deadline is a bit later, on June 15. 
• Deadline for taxes owed: If you owe income tax to the government, you still have to pay the amount by April 30, even if you don’t file your taxes until June 15.
• Weekend blackout: If April 30 or June 15 are a Saturday or Sunday, the deadline gets pushed to the following Monday.
• Newcomer tax filing date: When should newcomers file their taxes for the first time? Usually, on the filing deadline for the year when you become a resident for tax purposes. For instance, if you moved to Canada in July 2023, you would file your first tax return by April 30, 2024. You may also be able to apply for some benefits and credits earlier than that.

Note: If you file your return later than the due date, you may have to pay penalties and interest on any amounts owing.

What are the advantages of filing a tax return?

Not sure if you need to file a tax return? Even if it’s not required (like if you have a zero-income tax return) or you think you could leave it until later, there are still some very good reasons to file.

For instance: 

1. To receive a tax refund. A tax refund happens when the government sends you back all or part of the taxes you’ve already paid, because either you didn’t earn enough income during the year or you paid too much tax.
2. To avoid penalties on taxes owed. As a resident of Canada, you pay income tax on all worldwide income earned while a resident of Canada, both foreign and domestic sources. Be sure to report all sources of income and file by the deadline to avoid penalties and interest charges from the CRA. 
3. To set up your CRA My Account. Once you have filed your tax return for the first time, you’ll be able to use that information to complete your registration and access CRA’s My Account, the online system that helps you track and maintain your tax information as well as communicate with the CRA.
4. To take advantage of benefits. If you’re 19 or older, you may also be eligible for a larger refund through refundable credits such as the GST/HST credit, Canada child benefit (CCB), or Canada Worker Benefit. Even if you did not receive income during the year, it’s a good idea to file a return so that the CRA can determine whether you’re eligible for any tax benefits for newcomers.
5. To find out your residency status. What if you’re an international student studying in Canada? Well, you may have to file an income tax return. Whether you have to file or pay income tax in Canada depends on your residency status and whether you earn income in Canada. So it’s a good idea to figure out your residency status and how that affects whether (and when) you have to file taxes.

What is the impact of residency on taxes?

According to the CRA, you are considered to be a resident for tax purposes when you establish significant residential ties in Canada. These ties most often happen on the date when you arrive in Canada. Examples of significant residential ties include:

• Establishing a home in Canada
• Having a spouse or common-law partner in Canada
• Having dependents (such as children) in Canada

The criteria the CRA uses to determine whether you are a resident for tax purposes are not the same as those used for permanent residence status or Canadian citizenship.

If you are considered to be a resident of Canada or a deemed resident of Canada, you should file an income tax return for either the entire tax year or the part of the tax year you’ve lived in Canada. 

If you are not sure about the exact date when you officially became a resident, the CRA offers the NR74 Determination of Residency Status (Entering Canada) form, which you can complete and submit. The CRA then issues a decision letter with a date they consider you became a resident of Canada. 

Do refugees pay taxes in Canada?

Yes, refugees pay taxes in Canada. As a refugee, the amount of income tax you pay depends on how much money you make, as well as where you live and any deductions or credits you might have. 

How do I file my taxes for the first time? 

As a new Canadian, there are two ways to file your own taxes. 

1. Online: A certified tax preparer can submit your tax return online on your behalf; or, you can use NETFILE (that is, you prepare your return yourself using a certified tax software, such as TurboTax).
2. Mail: You can print and mail your first income tax return to the CRA.

What information do I need to file my return?

Generally speaking, to do your taxes, you’ll have to provide basic personal information, such as your full legal name, your address, and all income from the previous year (the easy stuff).

Other important things to note: 

• Make sure you have applied for, and received, your Social Insurance Number (SIN), which is used to identify you for income tax and benefits.
• If you are already employed in Canada, you’ll receive a slip from each employer you worked for during that tax year. The slip is called a T4 – Statement of Remuneration Paid; you should receive it from your employer by the end of February.
• If you recently arrived in Canada, you’ll need to include information about your income earned before arriving.
• If you received employment income from outside Canada after the day you relocated, you’ll need those numbers as well.
• If you have foreign assets over $100,000, you’ll need to report them on Form T1135 on your tax return.
• If you have dependents, such as a spouse, children, or elderly parents, you’ll have to provide all of their details, too.
• Credits and deductions you can claim depend on your own individual tax situation. For example, if you have child care expenses, you may be eligible to claim those on your return. If you paid medical expenses for yourself, your spouse, or your children, you may be able to claim those as well. (Make sure you have official receipts!)
• If you’re bringing any kind of assets to Canada, you will need to include details and market value on the day you arrive. Your capital gains or losses will be calculated based on this amount, if and when you sell them.
• For Québec residents, you must file a tax return with Revenu Québec as well. (Québec is the only province in Canada where you need to file two tax returns.)