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Your Tax Year 2023 Checklist - Canada

canada tax changes canadian tax cra tax tax season Feb 21, 2024
 

Get Ready for Tax Season with this handy checklist! 

 
I thought it would be great to give you a guide to get your tax planning started. Below you will find the most common Income, Deductions/Credits and questions that Canadians have.
 
I also highlighted what is new for tax year 2023 so you know what you can expect.
 
If you aren't a fan of reading, I've included an audio recording that covers this info as well. Click the video link.
 

Let's Get Started!

Before we dive into slips, deductions and credits, it should go without saying that you will need to provide answers to questions about your Canadian citizenship, residency, address, marital status, foreign property ownership, and your dependents (birthdate, income, name etc).
 
First Up - Income
 
Ensure to provide all the information slips received. Please double check whether you had received all the slips for the following types of income you earned during 2023:
 
*If you are filing on your own using tax software, take advantage of the auto fill my return feature and have all your T-slips automatically included in your return by connecting to your My CRA Account. This helps to make sure what you file is the same as the t-slips sent to the CRA on your behalf.
 
Income Slips:
  • T3 Income from trust or mutual funds
  • T4 Employment wages or salary
  • T4A Pensions, retiring allowances, annuities, fees or commissions, scholarships, etc
  • T4A(OAS) Old Age Security
  • T4A(P) Income from Canada Pension Plan
  • T4E Income under Employment Insurance and Other Benefits
  • T4PS Income from Profit Sharing Plan
  • T4RIF Income from Registered Retirement Income Plan
  • T4RSP Income from Registered Retirement Pension Plan
  • T5 Investment Income (including dividend, interest, foreign income, etc)
  • T5003 Statement of Tax Shelter Information
  • T5007 Statement of Benefits such as Social Assistance or Worker’s Compensation, etc
  • T5008 Statement of Securities Transactions
  • T5013 Income from Partnership
  • T5018 Statement of Contract Payments (for subcontractors in a construction industry)
    Provincial Any Provincial Slips Corresponding to Any of the Above
 
Other Income – Details of any of the below income where no T slips may have
been received:
  • Other employment income (including stock options and Election Form T1212)
  • Business or professional income. Also provide the details of relevant expenses (T2125)
  • Partnership or joint venture income
  • Rental income. Also provide the details of relevant expenses (T776)
  • Alimony, separation allowances or child maintenance
  • Pension income from foreign sources (i.e. U.S. and/or European Social Security Payments)
 
Deductions/Credits Information
 
  • Registered Retirement Savings Plan (RRSP) Contributions
  • University/College Tuition Fees for both full-time and part-time courses for you or your
    dependant. Ensure to include Forms T2202 (for Canadian schools) and TL11A, B, C or D (for Foreign) schools
  • Tuition fees paid for occupational skills courses even if they are not at a post-secondary level
  • Interest paid on a student loan
  • Medical expenses for you or a dependant person (including attendant care)
  • Do you or your family member (including parent or grandparent) have any disability? If so, please provide Form T2201 – Keep your Disability Tax Credit handy and make sure to claim the Disability Tax Credit as well. For children under 18 with no income, transfer this balance to the parents return.
  • Charitable Donations and Federal/Provincial Political Contributions
  • Union or Professional Dues
  • Childcare expenses (Claimed by the higher income earning parent)
  • Allowable business investment losses
  • Commission and employment expenses if you were required to incur your own expenses while carrying out your employment responsibilities. Note eligible employees who worked from home in 2023 will be required to use the detailed method to claim home office expenses.
    CHANGE FOR 2023: The temporary flat rate method provided during the pandemic does not apply to the
    2023 tax year. Also provide Form T2200 – Declaration of Conditions of Employment. This is mandatory to claim.
  • Effective for 2022 and later years, tradespersons and apprentices in the construction industry may be able to claim a “labour mobility deduction” of up to $4,000 per year for certain travel and relocation expenses incurred in connection with a temporary relocation.
  • First-time home buyers’ tax credit: The amount used to calculate the first-time home buyers’ tax credit has increased to $10,000 (from $5,000) for a qualifying home purchased after December 31, 2021.
  • Supplies purchased by eligible teachers and early childhood educators
  • Digital News Subscription Tax Credit – temporary 15% non-refundable credit on amounts paid up to $500 annually for eligible digital news subscriptions. Ends in 2024.
  • Canada Training Credit – refundable tax credit to help Canadians with training fees.
  • Home Accessibility Tax Credit – non-refundable tax credit for eligible renovations on an eligible dwelling occupied by a qualifying individual. Max $20,000 in expenses at 15% credit of $3,000.
  • NEW FOR 2023: Multigenerational Home Renovation Tax Credit: This new refundable tax credit is available for up to $7,500 (15 per cent of $50,000) of the costs of a qualifying renovation to an eligible dwelling that is completed to allow a qualifying individual to live with a qualifying relation. You can claim the credit for qualifying expenditures made or incurred after December 31, 2022, for services performed or goods acquired after that date.
 
Have the following related info handy (if applicable):
  • CHANGE IN 2023 Deduct up to the $1,000 for tradesperson’s tools expenses
    (increased from $500).
  • Alimony, separation allowances, child maintenance
  • Capital expenditures (i.e. equipment, vehicle) for your employment or business
  • Interest on money borrowed to purchase investments
  • Investment counsel fees
  • Moving expenses
  • Accounting fees
  • Pension plan contributions (include T10 – Pension Adjustment Reversal, if you received one)
  • Expenses qualifying for investment tax credits (i.e. film and video production, resource
    expenditures re: mining or oil & gas)
  • Adoption related expenses
  • Investments in labour-sponsored funds. You should have received Form T5006
 
Other Information/ Important Considerations Impacting Your Taxes:
 
  • Details regarding any withdrawals or repayments under Home Buyers’ Plan or Lifelong Learning Plan will be needed to prep your return if you have participated in these programs.
  • CHANGE IN 2023 Advance Canada Workers Benefit payments – Taxpayers no longer have to apply for advance payments of the Canada Workers Benefit (CWB) when they file their tax returns. These payments are now issued automatically to those who were entitled to receive the benefit in the previous tax year.
  • Receipts for 2023 income tax installments or payments of tax to the CRA
  • Have your prior year tax returns and notice of assessments. or any
    correspondences from the CRA handy if needed throughout your tax return preparation process.
  • CHANGE in 2023 Do you, or any member of your family unit, inhabit a home owned by an estate or trust? If yes, please consult an expert. The tax laws have changed significantly in this area and planning opportunities may be available to allow for the principal residence exemption to be claimed in the event of an eventual sale.
  • Annual contribution limit increase for the Tax-Free Savings Account (“TFSA”) is $7,000 for 2024. Individuals who have never contributed will have $95,000 of contribution room in 2024.
  • If you are an eligible apprentice, there may be additional grants/credits available. Check out this page for more info: Grants for Apprentice
  • Do you have, or share, custody of a child after a relationship breakdown? You may be entitled to the enhanced CCB and GST/HST credits.
  • NEW FOR 2023 New legislation requires taxpayers to remit tax payments over $10,000 electronically or pay a penalty of $100 per payment.
 
Other Changes to Note:
 
  • Effective 2024 the Climate Action Incentive Plan is now called the Canada Carbon Rebate
  • Penalties and Interest on unpaid balances has gone, whether employed or self-employed, pay on time by April 30th, 2024 to avoid these charges!
  • The basic personal amount for 2023 is $15,000
  • You can now start the application for the Disability Tax Credit online via your MY CRA Account
  • A new second ceiling for CPP contributions has come into effect, anyone earning above $68,500 will pay additional CPP contributions this year and going forward.

Time to Get Organized

Now that you have a thorough list, and some food for thought, you can start to organize your slips and receipts.  Whether you are providing them to someone to prepare your return or preparing on your own, you should now know exactly what you need and answered the question of "what do I need to collect?".

Happy Filing! Get started early, and get this over and done with!

 

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