There are two ways to file a tax return with the Canada Revenue Agency using free tax software. You can file through CRA’s free online tax system, Netfile, or you can print out your return and mail it. Either way, you require the same supporting documents and slips to verify the information that you entered on your tax return. “If you use Netfile to submit your return, don’t send in your income slips or other documents,” advises Caroline Thompson, president of Thompson Accounting and Tax Inc. of Fort Erie, Ontario. “If the government requires verification of any information, you’ll receive a letter requesting the documents they need to complete your return.”
Netfile and Documentation
Once you complete your tax return using free online CRA-certified software, you can submit it to Netfile. Supporting documents and T slips should be filed and kept in a safe place for six years in the event CRA requests more information or you are chosen for an audit. T slips can come from various sources and show income that you received during the current tax year, plus any deductions that were made from your income, such as income tax. You’re not required to send in documentation such as medical, dental and rent receipts, or any other paperwork that supports deductions you claim.
Late or Missing Slips
If you don’t receive a T slip on time, file your return before the deadline and include a note that includes the payer’s name and address, the type of income, such as employment income or CPP benefits, and what steps you are taking to get the late slip. You should receive most slips by the end of February. Keep all copies of your documents plus a copy of the note you sent. Estimate the income, deductions and credits using other T slips and information, and report it on the appropriate line of your return.
Using free software to file as a student requires you to be aware of your filing status. “Students can’t claim deductions that their parents have claimed,” Thompson notes. You also must make every effort to obtain proper documentation acceptable to the CRA. Thompson continues, “CRA is very particular about student rental deductions. If a student shares an apartment, CRA expects the student to obtain rental receipts only for their portion of the rent. CRA may question receipts for the entire amount of the rent if more than two students shared accommodations, even if you state you’re only claiming your share.” These receipts don’t need to be sent in with your return, but you may be requested to produce your portion of the rental receipt to verify your claim.
Filing Printed Returns
If you choose to use a free tax preparation software program but opt out of Netfile, you can print your return from the free software and send it by mail. Certain documents need to accompany your mailed tax return, but not everything. Include copies of all your T slips, such as a T4, T4A, T4E, T4RSP and any other slips pertinent to your income situation. This income may come from many sources, including your employer, registered retirement plans, bank account interest and Canada Pension Plan benefits. As with Netfile filings, you do not need to include supporting documentation, such as rent receipts, for deductions you claim. However, keep them filed in case CRA asks for verification.
References & Resources
- Canada Revenue Agency: Frequently Asked Questions About NETFILE – After Using NETFILE
- Caroline Thompson: President: Thompson Accounting and Taxes Inc.; Fort Erie, Ontario
- Canada Revenue Agency: About Netfile
- Canada Revenue Agency: Information Slips – T4 and Other Slips