Mastering Tax Season: A Guide to Navigating the CRA My Account

 In this episode I walk you through the benefits of registering for your CRA My Account. It is an incredibly useful tool for understanding your tax situation and finding tax slips all in one place. 

I would highly recommend that everyone register for it before you file your taxes this year! 

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Transcript

Speaker 1: 0:08

Hello and welcome back to the Canadian Money Roadmap Podcast. I'm your host, evan Newfield. On today's episode, I'm going to talk to you about a tool that every Canadian should be using when it comes to filing your taxes and getting information around tax time. February is here, and so that means that many people are ramping up to get ready to file their taxes. I don't know about you, but I was never one that was too keen on getting that done too early, but I know lots of people are looking to file as soon as they possibly can. So in this episode, I wanted to talk about a tool that you should be using to make sure that you've got all the information you need to make good decisions right around tax time. So, before I get into that, I think it would be valuable to talk about some important dates around filing taxes, and so for 2023 tax years so now we're in 2024, but you file your taxes for the previous calendar year the early state that you can file your taxes online is February 19th. That's coming up in a couple of weeks by the time this episode comes out, but the deadline to file your taxes for last year is April 30th, so there's a window of about two and a half months there to get all of your taxes done. Now, if you or your spouse are self-employed, you get a little bit of an extension there to June 15th, but for the vast majority of people this is kind of the window that we're dealing with. So if you're pretty keen and you want to get going for February 19th, I would encourage you to at least do this. So the whole point of this episode is introducing you to something called your CRA my Account. If you've never heard of this before, count yourself among the majority of people, because when I talk to clients and people about their finances and this topic comes up, most people have never registered for it before. So I'm going to walk through all the different information that is available on this account and why it's important for you to do so. So first of all, of course, it is free. It is access to your own information, but it's really important information because it all has to do with your taxes and benefits. So before you can access it, you will need to register before you can use it. To do that, they're going to ask you for a bunch of information, but included in that information is going to be some random info from a previous tax return to verify your identity. So, before you go to register, make sure you have your returns from the last two years handy, just because they're going to ask you for some numbers on there, just to make sure that the person registering for this account is who they say they are. I'm not sure if this is still the case or not, but in the past they've had to mail you a code to use, so there was a bit of a delay. So that's why I wanted to do this episode first. So if that is still the case for you and you have to wait to get a code from CRA to be able to access your my Account and the sooner you can do this the better because there's going to be an influx of people filing and CRA's got other things to do than deal with registrations on this, so I would get on this as soon as possible. So, assuming you have now registered and you have your access and you can log in, here are some of the things available online. The first thing that you should do is to double check that your profile is correct. I sat down to record this episode and I thought, okay, well, let's look around and see what kind of things we could talk about on the podcast. And sure enough, my mailing address and my home address were incorrect because I moved last year. So this is a good reminder that if you've moved, go update your account. So this is a good way to be able to do that and it's quick and easy and you can do everything online. So when you go to update your profile, you can see that your account is correct. You can change your marital status. This used to be something where you had to call them and do it over the phone, so that was a big nightmare because people only realized they had to do that when they're filing their taxes, and so the wait times to get ahold of CRA just to update your marital status was a nightmare. So you can find and change that information there if needed. If you're married, divorced or whatever, you can change your marital status and your profile. In addition to that, your child information is listed there. Now this one is a little bit unique. I'm going to mention this so I don't scare anybody. I don't have any children listed on my profile. The reason for that is that there can only be one person who's listed as the person who is primarily responsible for a child, and so on my wife's account, she'll have both of our kids listed on there and if that needs to change, you can do that there, also on here, if you've ever changed your banking information. If you've never done direct deposit, the rules about that have changed. If you're expecting a very large return, they're issuing I think it's $100 penalty this year for refunds over $10,000. If they're issuing a check. So I would always encourage you to get your direct deposit information updated with CRA. That way you can get your money way faster if you are entitled to a refund or any other benefits that come through your CRA or benefits Canada. Okay, so those are some of the high level things that you'd want to do to make sure that you can actually get all of the refunds that you're entitled to. It's making sure your profile is correct your address, your direct deposit, your marital status and your kids. Those things will all affect how much you can receive or where the money goes. So that's super important and I was glad I looked today because my address was incorrect. Now, beyond there, let's go through a few things that you can find on your my account that are valuable to you. The first one is under the tax returns tab. You'll see this on the left side, but also on the dashboard on the homepage. You'll be able to find this information there. When you click on the tax returns tab, you'll be able to see all of your returns going back as far as they have them, and you can have access to your notice of assessment from previous years. Why is a notice of assessment important? Well, the notice of assessment tells you tons of information, including how much income you had, how much tax you paid, the credits you had available, how much you contributed to CPP all these different things. You say, okay, well, maybe that's not that important, but things like capital losses and RSP deduction limits those things really come up as valuable for planning purposes. So at the bottom of your notice of assessment it's usually on the second or third page, I think it will give you a number that says you're available contribution room for 2023 or whatever notice of assessment you're looking at. If you're someone who is contributing to RSPs and it makes sense for you to do so, knowing how much room you have to do that is valuable. I'm going to come back to that in a second, because you can find that information on another spot on your my account. If you ever need to provide things like a proof of income to get a loan from a bank or something like that, you can find that information here Super valuable. This comes directly from CRA and you can get it as a PDF and you can download it instantly. You don't have to come up with all these slips or anything like that, the information is just readily available. So this is really common. If you apply for mortgage or things like that, you can get that proof of income super quick. Also, on this, tax returns tab is probably the most important section for people who are filing taxes. What I have seen far too many times are people that forget about certain slips or didn't realize that a slip was coming, and they go really fast and they want to file their taxes on February 19th or whatever the first day is for that year, and they completely forget or miss reporting some income from the previous year. And this is a problem because if you have unreported income, you can be reassessed and you'll have to pay the taxes that you owed plus a penalty for missing that income. So I'm going to say this again that if you want to file your taxes right away on February 19th. It's like give it a minute, just let it breathe. You don't have to do it right away and the risk of missing something is very, very high if you try to file your taxes on the very first day. The reason for that is that Most slips or many slips, I guess have no obligation to actually be issued before the end of February, and some of them, including T3s I'll explain what that is in a second they don't have to be sent before the end of March. So if this is relevant for you and you're filing in February, you're gonna miss something. So just give it a minute. Maybe wait till April, okay, but all this to say back on this tax return tab on your CRA my Account, there is something that says Tax Information Slips and you can select any year, going back like 10 years, and you can find all of your slips for that year. This includes RSP contribution receipts, but also statements of income, t4s, t5s, t5008s, t3s I won't go into all of those today, but they are available there. Why is this important? Well, if you're using a software that allows you to auto-fill your return and you have a very simple tax situation and you only have a couple of slips. If you're registered for your CRA my Account, you can auto-fill your return and it'll pre-fill everything for you because CRA knows what you have, because all these slips get issued to them as well. So if you are filing your taxes without using the auto-fill function, at least to double-check what you think you should have, you run the risk of missing something entirely and then running into some penalties. So this is a great way to simplify your tax filing and also to check for any errors. Everything's all in one place, so you're going to get stuff in the mail, stuff by email, but all of these slips will also be uploaded into your CRA my Account. There are no guarantees that everything will show up there at the right time or early or anything like that. So this is just my disclaimer that make sure that you just use this as a way to double-check your income, not as the only thing that you ever have to consider. Okay, but, for example, I'm looking now for my 2023 year and there are a few slips that I don't have yet. I know it's not February 19th and I can't file anyways, but we're into February and I'm still missing some slips. So you can check back regularly and probably closer to when you're actually wanting to file your tax return, and then you can see if all of your slips are there. This is really helpful if you have changed jobs partway through the year and you forgot your T4 from the previous employer, or if you're retired and you have income coming from rifts from multiple financial institutions. If you have savings accounts at banks that are not registered and you get income from those, things get complicated and they don't always reach out to you in the same way, like by email. Sometimes you have to have a login for different things and things just start to get complicated. But this is a comprehensive resource to bring all of those slips under one roof, so that'll be the biggest thing. That'll really make a difference for you when filing your Return. Lots of other things are available on this page of for your tax returns. I won't go into all of them, but things like if you qualify for the disability tax credit, you can see where your application is at, you can refile. You can take a look at a few other things like carryover amounts from previous years Really, really, really valuable information here and the accounts and payments tab. This is kind of the next one you can take a look at how much you have owing if that is a situation you find yourself in. If you're someone who pays quarterly Installments, which is quite common you can see how much you will have upcoming for your next quarterly payment and how much you have on your account from last year's quarterlies. So I can see all of those amounts here listed for me. The thing to keep in mind here is that you might see balances of zero dollars. Keep in mind that this is now for a calendar year of 2024. You'll have to dig in a little bit deeper to find the taxes that you had paid for 2023 already. So that's a little bit buried. So if you go in there and you see zeros when you're expecting many tens of thousands of dollars to be sitting in your tax account, just dig a little bit deeper and it is just a calendar year situation. Another cool feature on this page Is the ability to look at uncached checks from CRA from the past. So if you got a refund that you never actually claimed or you never cashed the check, you can go in there and you can see if you've got any money sitting around. If you're listening to this now and you do this, please look there. I am curious to see if any of you have any uncached checks. I'm not gonna ask for a commission, but I just want an email if this is relevant for you. I don't know how many people this would qualify for. I don't have any uncached checks Based on this. Anyways, I've had direct deposit set up for a long time and so I was hoping that that was in the case. But anyways, I'm curious to see if that is something that creates a little bit of found money for anyone out there listening. Now the next section is the benefits and credits section end. So if you are the primary caregiver for a child, you'll be able to see your candidate child benefit amount there. I talked about that earlier this year. You can go back and listen to that episode for some information about the CCB. I don't see any information here again because I am not the primary person responsible for any of our kids that is my wife in this case but if that is relevant for you, you'll be able to see that information there. The GST and HST credit, the climate action incentive payment, the disability tax credit like I mentioned before, all of that information is available here in the benefits and credit section. Huge thing, huge thing is that all of this money that's available in this section here including the Canada child benefit, which is tax-free money if you have kids these are only available to you if you file your tax return. I will say that again you will only receive the Canada child benefit, your GST credit, your climate action incentive payment, the disability tax credit. You only get these things if you file your tax return. If you do not file, even if you had no income, you will not receive these payments. The same is true for old age security as well, for those of you who are over 65. Okay, so, if there's any anyone listening here that has never filed before or wasn't thinking it was important to file, get your money Right. Just go through the process of filing, even if you didn't have income or if you had very little income. You're probably gonna get a refund and then you qualify for all these other things that are money in your pocket. So please, please, please do that. The last section I'm going to talk about here is the savings and pension plans section. This is available on the dashboard, on the home screen as well, but it'll show you two numbers. I'm going to break them down a little bit. Well, in my case it's two numbers. It'll show you four if it's, depending on your situation, but the first one is your RSP deduction limit. So, like I mentioned before, that number is available on your notice of assessment, which you get every year after you file your taxes. But your my account will put that front and center so you know how much room you have available. Please keep in mind that this number is not a rolling total based on what you've done throughout the year. This is how much you had available when you filed your taxes last year, and so it is just the amount that's available for the calendar year. It does not take into account how much you've put in during that year as well, so that gets reported on the next year's return and so on. So it is not a live updated number. So just please be careful with that. If you have any unused RSP contributions from previous years, so you can put money into an RSP and not claim it on that year, so you might want to do that if you expect higher income in the future or something. There's a variety of scenarios where that could make sense to do. But that number will be available on your my account as well. Next number listed here is your tax free savings account contribution room. This one is also a huge, huge thing that you want to be careful of. It's nice to have that number front and center, but again, this is current as of January 1st 2024. However, there's a little tab beside it that says important information. Your financial institution is not obligated to report how much you've contributed to your TFSA until the end of March, and so there could be nearly a 15 month period where this number is no longer accurate, right? So if it's current as of the beginning of a year and then you make contributions throughout the year and then again for the first three months, whatever, this number will not be super accurate. If you're looking at it at the beginning of the year, okay, so it'll give you your TFSA room based on the information that they know, and they will only know more information by the end of March. So I would recommend that you use this number as a guide, april and later. If you can do the math on your own and you know what you can contribute, I guess that's fine. Just be be careful with that. But this number will not be necessarily accurate until your financial institution has reported your contributions to CRA and that won't happen live. So it doesn't happen every month, doesn't happen every day. It happens once a year and it happens at the end of March or a little bit earlier. I've seen all sorts of different dates there. So just be very careful when you're looking at that number and be sure to know what it includes. The nice thing is there's a link there that says you can view TFSA details and you can see all the transactions that you've ever made into a TFSA and have then been reported to CRA. So if you've known you've made contributions or withdrawals or anything like that, you can look there to see if that has been reflected in your account. If it has not, you know that the number is not accurate yet and you're still waiting for those reports to come in. Hopefully that made sense, but this is both a good news and bad news number here of. It's nice to know some information, but that information isn't necessarily accurate, depending on the day that you're looking and the contributions that you made over the last year. Moving on next number, if you've ever withdrawn money from your RSP under the homebuyers plan, you will be able to see your balance there. Same thing with the lifelong learning plan. Haven't talked about those too much on the podcast, but they are programs that allow you to withdraw money from your RSP for either buying your first home or for paying for Education. That money then has to be repaid back into your RSP or else you take that Amount into your income in subsequent years so you can see how much you have left owing back to yourself. It's kind of like a loan from yourself in that section of your my account. Quite a bit of other information available here, but those were the things that I thought were most relevant to the average person. Last thing here is that on the very First thing on the home page, you can apply for the new candidate dental benefit. If your family has Income below $90,000 per year and your kids are 12 years old or under, you can apply for this program. It's it's brand new. I don't have a lot of the details at the top of my head, but the nice thing is about this account you can apply for it right there. So, anyways, this was my pitch to get you to register for your CRA my account. It is really valuable. They've got a mobile app, lots of great information. It's really easy to access. It's really user-friendly. Actually, once you get in there, you can log in with your banking information, so you don't have another password that you need to remember. But you need to be able to register first to be able to have access. So make sure you head over to the Canada Revenue Agency and register for your my account this year before you file your taxes. And that's it for this episode. Thank you so much for listening. Let me know if this was helpful. Send me an email over at podcast at evan newfieldcom. I love to hear from you. Thanks so much for those of you who do reach out. I appreciate all the kind words and people sharing with their friends and family. Thanks so much for listening and we'll see you next week. Thanks for listening to this episode of the Canadian money roadmap podcast. Any rates of return or investments discussed are historical or hypothetical and are intended to be used for educational purposes only. You should always consult with your financial, legal and tax advisors before making changes to your financial plan. Evan Newveld is a certified financial planner and registered investment fund advisor. Mutual funds and ETFs are provided by Sterling Mutuals Inc.