2018 A New Tax Season and A New Team
A New Tax Season & A New Team
FROM HOLIDAY SEASON TO TAX SEASON
I trust that the Christmas and New Year’s holidays were good for you and your family. My family had a good time celebrating with my 15-month-old grandson, Jasper, and wearing all the matching pajamas that I managed to find time to sew up in the last couple of weeks before Christmas. I have found that sewing is a fun, creative outlet that is absolutely opposite to my career. It can be a good stress reliever to create something fun that can be worn. However fun this might be, it does get sidetracked during tax season.
There have been some changes within Smart & Associates. Kerry, my former receptionist/bookkeeper, was not able to return to her position after her emergency medical leave last year. I generally love the mantra, ‘If you fail to plan, to plan to fail.’ Well, I certainly did not plan to have a staff member go off on emergency medical leave, so I had to fall back onto another mantra a general contractor taught me: ‘Improvise, adapt and overcome.’ For some reason, this is what the year 2017 felt like.
I have a new plan for 2018 and I am happy to announce that Jenny McGovern, CPA, GGA, has joined my firm, effective February 1. Jenny brings to the firm a wealth of professional experience and she will be a first contact in the office for clients during the tax season.
TIPS & NEW POLICIES FOR AN EVEN SMOOTHER TAX SEASON
As always, there are new procedures and policies in place within the office. I have implemented a new collections policy that is simply meant to help clarify the process as I find too much consideration is given to how to communicate in a thoughtful manner. We are all relying on email far too much to deal with difficult situations and I am hopeful this new policy will be helpful to the few clients who need more support.
I continue to look for ways to increase efficiencies within our paperless office and have some suggestions as you prepare for your personal tax return preparation and filing.
As documents provided are scanned and saved to your client management folder, to speed up the administration aspect of scanning documents please do the following:
POS receipts: Remove all staples on documents. Any POS receipts stapled to the documents should be removed as the supporting document is what is needed
Medical expenses: Remove all stapled POS receipts and summarize the medical expense total.
If you have a good idea what your income is for the year, multiply that income by 3% this amount to a maximum of $2,237 is first your threshold as to how much medical expenses you first need BEFORE you can begin to claim the 15% federal tax credit on the medical expenses paid.
For example, if your income is $40,000, multiply this by 3%. Your threshold is $1,200 and you need more than $1,200 in medical expenses just to begin to qualify for the medical credit. Often, time is spent organizing medical expenses and calculating these slips only to see that the client does not have enough medical expenses to use.
Children’s Art & Fitness Credits: For the 2017 tax filing season, those clients with children, please note that the Children’s Art and Fitness credits are eliminated.
March 1, 2018
Final date for 2017 RRSP contributions
March 15, 2018
Payment due date for 1st quarterly 2018 tax instalment
April 18th, 2018
Deadline to bring in your personal tax file to the office with assurance that filing can be done by April 30th. Files will be accepted after this date, with the understanding that files in que will have priority.
April 30, 2018
Due date for 2017 income tax return due and payment of taxes owing
June 15, 2018
Filing due date for 2017 income tax return due for self-employed individuals
Important Reviews that CRA can initiate
After filing your personal tax returns there are times where the Canada Revenue Agency “CRA” want to “review” your return. Why would CRA do this? Well, as the Canadian tax system is based on self-assessment and as more than 80% of Canadian taxpayers now file their personal tax returns electronically vs. a paper return with the supporting documentation attached to the paper return, CRA likes to randomly follow up on Canadian taxpayers to ensure compliance. Below are the four basic types of reviews that CRA performs:
Pre-assessment Review Program
The reviews are conducted before a Notice of Assessment is issued and the peak period for this program is February to July.
Processing Review Program
Similar to the above Pre-assessment Review program, but these reviews take place after the Notice of Assessment has been issued. The peak period for this program is August to December
This program takes place after the Notice of Assessment has been issued and “matches” information filed by the taxpayer to information filed to CRA by third-party sources, such as employers or financial intuitions.
Special Assessments Program
The reviews under a special assessment program can take place before or after a Notice of Assessment has been issued. This program is a more in-depth review of the income tax return and can take place after any of the above reviews has been completed. This more in-depth review looks to identify and gather information on trends and situations in areas of non-compliance that may represent a risk to the self-assessment system.