If you still haven't done your taxes, there’s no need to scramble. By getting organized and leaving enough time to do a final review, you’ll ensure that your return is accurate and that you've claimed everything that you’re entitled to.
Here are a few ways you can reduce tax-time stress and focus on filling out your return accurately and completely:
Create a tax workstation. Find a place with lots of light where you can work comfortably. A desk or even the kitchen/dining room table works. Make sure the workspace allows enough room to sort papers in an orderly and accessible way.
Get organized. Gather all documents including tax slips and receipts. Organize receipts into relevant categories: medical, legal, transportation, charitable donations, business expenses, entertainment, etc. It’s much easier to work productively when you are not frantically looking for elusive paperwork.
Book time and clear away distractions. Set aside a few hours or an entire day where you can be free of other responsibilities. Arrange for the kids to have something to do or be somewhere else. Turn off the ringer on the phone and do whatever you can to eliminate potential distractions.
Take advantage of your peak performance time. The biggest error on income tax forms is math mistakes. So if you are a morning person, get up early to tackle your taxes. If you are an afternoon person, schedule the task for that time. You will get it done more quickly and accurately when you are at your best.
Consider your best mode of delivery. Over 40 per cent of people file their taxes electronically, but if you aren’t technically savvy then mailing a hard copy return may be the best alternative. If you are comfortable with electronic or telephone filing, this will cut processing time down substantially. An electronic or telephone tax return is often processed within two weeks, compared to six to eight weeks for a paper return.
File on time—even if you can’t pay the tax due. In 2000, over 200,000 people filed their tax return late. If you owe money and file late Canada Customs and Revenue Agency (CCRA) will charge you five per cent of what you owe plus daily interest. So file your return on time even if you can't pay the money due. You'll still be paying interest that is compounded daily but you’ll save the five per cent penalty.
Get professional advice. If you report more than just your employment income on your tax return, you will probably benefit from having the return prepared, or at least reviewed by a tax professional. Before you hire a professional, take time to decide on the level of service you require and weigh the cost of such services versus filing the return yourself.
If you use a professional, ask questions. If you decide to use a professional tax service or accountant, be ready with the right questions. For example: How much will the service cost? Is it a flat fee or an hourly rate? What experience do they have? Do they have a professional designation? Are they up-to-date on changing tax laws, exemptions and deductions? Can they provide references? Remember, even if you have a professional prepare your tax return, you are responsible for any errors. Make sure to review your return before signing it.
Consider using a tax return software program. If your tax return is relatively straightforward, and you are comfortable with computers, this may be a solid option.
Choose the right tax software program for your needs. Before selecting a specific program to file your taxes, research and compare products. Consider the program’s user-friendliness, available service support, compatibility with your home computer system and memory requirements. Vendors often provide sample copies of their software, so take the time to try it out. Choose a program that you will be comfortable using within a few hours, at most.
Give yourself a break! When the going gets too tough, take a short ‘time out’ to shake off any frustration and to regain your focus.
Need more information on budgeting or planning your financial future?
Your Employee Assistance Program (EAP) can help. Connect with your EAP
to see if you are eligible for financial support services, at 1 800.387.4765
for service in English,
1 800.361.5676 for service in French.
© 2005 WarrenShepell