Apr 19, 2017
Pattie Lovett-Reid: The tax clock is ticking
Chief Financial Commentator, CTV
We’re in the final month of the 2017 tax season, meaning it’s crunch time for many Canadians.
In total, 8.65 million people will have filed their taxes by now (of which 3.37 million file within the do-it-yourself category). Even though so many of us have completed our taxes, we do still have a ways to go.
A survey conducted by TurboTax at the beginning of the tax season revealed 26 per cent of Canadians admitted they are likely to file at the last minute. The survey also found that men are more likely than their female counterparts to wait until the last-minute to complete their taxes (30 per cent versus 23 per cent). They are also more likely to file their taxes late (11 per cent versus eight per cent).
For those who have filed, the data below highlights key trends for this year’s tax season, from demographics of tax filers, to what credits and deductions are being most utilized:
- To date, millennials and Gen Y is leading the pack when it comes to filing their taxes (41.2 per cent of overall tax filers). Gen X is next (30.1 per cent), followed by Baby Boomers (20.5 per cent).
- Manitoba is the most charitable province with 34.40 per cent of its residents having filed credits for donations (vs. National Average of 28.05 per cent). The average donation amount claimed is $1,255.84.
- 46.3 per cent of Gen Xers have contributed to their RRSPs, followed by 36.1 per cent of Baby Boomers. The average contribution amount for all demographics is $5,151.53.
The top five deductions claimed by Canadians include:
- Employment amount (84.7 per cent)
- CPP/EI (81.8 per cent)
- Medical expenses (12.8 per cent)
- Transit passes (12.5 per cent)
- Spousal/dependent amount (12.0 per cent)
Your tax return needs to be filed by April 30, and your payment has to be received by the CRA on or before the deadline. If you are sending you payment by mail, the envelope with the cheque has to be postmarked on or before April 30.
The penalties for filing your tax return late can be quite steep if you have a balance owing. If you owe tax, the CRA charges you a late filing penalty. The penalty is 5 per cent of your balance owing, plus an additional one per cent of your balance owing for each month your tax return is late, up to a maximum of 12 months.
As with your credit card bill, if you cannot afford to pay the full balance that you owe, consider paying at least a portion. That way, you avoid costly late filing penalties.