5 Tax Myths
March 14, 2014 by

5 popular myths regarding Canadian taxes.

Tax season is a stressful time of year for most people, a time that can be made even more stressful when you’re unsure of what’s fact and what’s fiction in terms of your tax return.

Take some of the stress and anxiety out of filing your taxes this year by becoming more informed. Have a look at the below five tax myths and you could potentially save yourself some money this year, or, at the very least, some of the worry.

question-mark-463497_640

5 Canadian Tax Myths:

  1. MYTH: The income you receive during maternity leave via employment insurance (EI) is not taxable.
    TRUTH: Maternity benefits, as well as all other EI benefits, are taxable.
  2. MYTH: You do not need to file a tax return if your income was less than $10,000.
    TRUTH: Filing a tax return, regardless of how much you earned, may entitle you to the quarterly GST/HST payments.
  3. MYTH: Unless you have never owned a home before, you are ineligible for the RRSP Home Buyers’ Plan.
    TRUTH: If you haven’t owned a home in over five years, you may still take advantage of the Home Buyers’ Plan and withdraw up to $25,000 tax-free from your RRSP when purchasing a home.
  4. MYTH: If you win a sweepstake or lottery, you have to pay taxes to the Canada Revenue Agency (CRA) before you are eligible to claim your prize.
    TRUTH: You do not have to pay the CRA taxes or fees on lottery and sweepstakes winnings in Canada.
  5. MYTH: Filing your taxes online increases your chances of being audited.
    TRUTH: The CRA may ask you to submit supporting documents that you were unable to include when you filed online, however, this is not an audit.

Still a little concerned about the upcoming tax season? Please do not hesitate to contact us at our West Vancouver office.

(Image via Pixabay)