Well, here we are; it’s now April. That means that in 29 days from now, many of you will be scrambling and panicking because you woke up and realized that you forgot about your tax return. For those of you who didn’t get an early start on your taxes, I wanted to go through some of your options, and encourage you to get started as soon as possible.
DIY
If you’re the kind of person that likes to do everything yourself, there are plenty of options out there for you.
Old School: With all the advertising you’ll be subjected to from tax software companies, there is one free method that doesn’t have a list of system requirements. Brew a pot (or 3) of coffee, print out a copy of your tax forms, and get started on the financial equivalent to the Sunday crossword puzzle. Although it’s more time consuming, doing your taxes manually gives you a much better understanding of how it all works. Just make sure to double-check your calculations before sending them in.
Free Online Filing: As far as I can tell, there are 3 main tax preparation names in Canada; Intuit, UFile, and H&R Block. If you have a very basic return to file, as well as a low income for 2010, each company has a free online version of their software. To find out if you or someone you know qualifies, you can check out information for TurboTax, UFile, and H&R Block at Home.
Paid Software: If your returns are a bit more complex, or your income is too high to qualify for the free version, there are many different versions of the paid apps to choose from. The big 3 have basic online versions that will cost you under $20. For a bit more, they will step you through how to handle investment, rental, or self employment income. The online versions are less expensive and easy to use. If, however, you are planning on doing several returns, the download/CD versions will allow multiple (at least 8) returns for one low price.
Hire a Professional
If doing your own taxes sounds about as exciting as doing your own dental work, then consider hiring a professional to do your taxes for you.
Discounters: If you want someone else to do your taxes AND you want your refund immediately, tax discounters can do both. A tax discounter will pay you right away, but then will take a percentage (up to a maximum of 15%) once your actual refund shows up. The most well known of these would be H&R Block with their Instant Cash Back service.
Accountants: Although normally reserved for larger businesses, if you have a very complicated tax return, an accountant is a great way to go. They will have the expertise that a bookkeeper or tax preparer will not, which can be very helpful if you’re dealing with a very large or complex return. The trade off will be cost; accountants charge much more per hour than a bookkeeper or tax preparer. In most cases, if you’re doing a T2 corporate return, you should talk to an accountant.
Bookkeepers or Tax Preparers: If you don’t want to do it yourself, but you also don’t need the money today, there are plenty of good bookkeepers and tax preparers out there. Like with any other service provider, be sure to do some research before deciding on someone. After all, the person you select will be handling the financial documents you send to the government…not something you want to outsource to just anyone. Based on my recent scan of Kijiji, I’d say that if they can’t spell bookkeeper or accountant, then they might not be a good choice.
Helpful Resources
TaxTips.ca – This site is a huge source of information about all things taxes in Canada. If you’re going to do your own return this year, make sure to have this site open.
Bookkeeping-Essentials – This is a great spot to learn about all things bookkeeping. This would be particularly useful for bookkeepers who need some help of their own.
Canada Revenue Agency – Not surprisingly, the best place to find out about tax returns is from the source. You can find all of your forms, guides, and tips to help you get through this tax season.
TurboTax Tax Tips – Intuit has a great set of tips and videos to help you out with a wide range of topics.
Finally, I’m also here to help if you have any questions, or if you’re looking for someone to complete your return this year. I have been doing tax returns for many years, and I can complete both T1 and some T2 returns as well.
For more information, check out my Services page to see how I can help, or contact me if you’d like to discuss your options.
Good luck!