As a newcomer to Canada, filing your taxes is an essential step in managing your finances and accessing government benefits. Even if you haven’t earned income yet, filing a tax return can help you qualify for tax credits and benefits.
1. Determine If You Need to File a Tax Return
You must file a tax return if you earned income in Canada from employment, self-employment, or investments, want to claim tax credits and benefits like the GST/HST credit or Canada Child Benefit, or need to report foreign income.
2. Gather Necessary Documents
Before filing, collect your Social Insurance Number (SIN), T4 slip (employment income statement), T5 slip (investment income statement), receipts for deductions and credits such as rent, medical expenses, tuition fees, and childcare costs, bank statements and pay stubs if self-employed, and foreign income records if you earned money before moving to Canada.
3. Choose Your Filing Method
There are three main ways to file taxes. You can file online using NETFILE-certified tax software like TurboTax, Wealthsimple Tax, or H&R Block. You can also file by paper by downloading tax forms from Canada.ca, filling them out, and mailing them to the Canada Revenue Agency (CRA). If you prefer professional help, visit an accountant or a tax clinic. The Community Volunteer Income Tax Program (CVITP) offers free tax help for newcomers with simple tax situations.
4. Report Your World Income
In your first tax year, you must report any income earned before moving to Canada. This helps the CRA determine your eligibility for benefits and tax credits.
5. Claim Benefits & Tax Credits
As a newcomer, you may qualify for the GST/HST credit, a tax-free quarterly payment for low- and moderate-income individuals, the Canada Child Benefit (CCB), monthly payments for families with children, the Climate Action Incentive Payment (CAIP), a rebate for residents in certain provinces, and tuition and education credits if you paid for post-secondary education.
6. Submit Your Tax Return
The deadline for filing taxes is April 30 each year. If self-employed, the deadline is June 15, but any taxes owed must still be paid by April 30. After filing, you will receive a Notice of Assessment (NOA) from the CRA, confirming your tax details and refund or payment status.
7. Pay Any Owed Taxes or Get a Refund
If you owe taxes, you can pay online through your bank, CRA’s My Payment service, or by cheque. If you are eligible for a refund, the CRA will deposit it into your account if direct deposit is set up.
8. Keep Records for Future Use
Store all tax-related documents for at least six years in case the CRA requests verification.