Here's How To Set Yourself Up For A Bigger Tax Return In 2023, According To An Expert
Get ready, folks! It's almost time to file your taxes in Canada and with the tax deadline just around the corner, you might be thinking about tax returns and how you can save on taxes in 2023.
Since there are lots of things to consider, Narcity spoke with UFile tax expert Gerry Vittoratos to get the lowdown on what you need to keep in mind when it comes to taxes and tax returns.
From staying up-to-date on the latest credits to getting organized, here are some of the handy tips that can help you save big come tax time.
Stay up to date
Vittoratos has recommended looking up the tax return changes that the government makes, which are typically done in March or November.
"Many of these changes become applicable as of the date of the announcement; therefore, you can start benefitting from these changes immediately," said Vittoratos.
"That means that it's not too late to claim some of these amounts that were announced."
So, always be sure to read that fine print on new economic announcements because you might be able to get something from them immediately.
Get organized
While most people will submit their taxes for 2022 to Canada Revenue Agency in April 2023, Vittoratos suggested starting early.
"The production of your tax return is not [a] one-time-a-year thing," said the tax expert.
"Create a folder from now for 2023 where any document that relates to your tax return is put in."
Getting organized will go a long way in ensuring that you have everything ready for your tax return.
"The biggest reason for missed credits and claims is taxpayers not archiving their receipts properly, and missing out on amounts they're entitled to," Vittoratos said.
Keep receipts
Whether it's money given to charitable causes or medical expenses, it's important to keep receipts so you can get some money back.
If you don't have copies of any receipts, Vittoratos recommended reaching out and getting them for your files now.
Donate now
If you're in a charitable mood, make sure you donate before the year ends so you can benefit from the donations tax credit.
"The credit itself can be very beneficial tax-wise," explained Vittoratos. "On the federal side, you get a 15% credit for the first $200 you donate and 29% to 33% (depending on your income) for any donations you make above $200."
Sell any losing investments
If you sell off any investments in your taxable accounts that are losing value, you can create a "capital loss" which you can use to offset gains you may have gotten elsewhere.
This means a lower reported capital income and, therefore, lower taxes.
"However, there are stipulations," said Vittoratos.
"When you sell these losing investments, you and your spouse have to wait 30 calendar days before buying the same investments in order to create the capital loss."
So, if you do want to buy back in, just be sure to wait more than those 30 days.
Hopefully, these tips will help you get the maximum amount of money back come tax time!
This article's cover image was used for illustrative purposes only.
