Preparing for tax time

Dianne St. Jean
Preparing for tax time

It’s a new year, and that means getting ready for tax time.

For the next few issues we will be publishing tax tips and information to help you prepare and file your tax return.

Even if you use a tax preparer, you will save time and money if you do the most you can to prepare your file even before you hand it over for someone else to file.

Make it easy and simple:

Use some kind of system, like using file folders or large envelopes for different categories. Basic tax categories are things like medical expenses, donations, education expenses, business expenses, and income.

Throughout the year, put any receipts or papers pertaining to those categories immediately into these. You will save time in sorting these out later when it comes time to put everything together. 

And, if you are ever required to provide proof, especially regarding your expenses, they are easily on hand.

Tips on medical expenses:

You are allowed to claim driving expenses if you have to travel more than 80 km for a medical appointment if you don’t have access to the treatment where you live.

You are also allowed to claim meals for those days.

Qualifying medical expenses include payments made to a medical practitioner, prescription drugs, certain medical devices, and medical premiums paid to an insurance company for medical benefits. 

Make sure to keep all of your medical receipts, as the CRA may ask to see them in the event of an audit.

Note: Not every dollar that you spend on medical expenses qualifies for a tax credit. There is minimum dollar amount over which medical expenses can be claimed.

To maximize the amount that you claim, combine the medical expenses for you, your spouse, and dependents on one family member’s tax return.

Next issue we’ll talk about business expenses and how to avoid getting audited in the process!