5 Tips to Getting the Most Out of Your Tax Return
Though filing your taxes can be stressful, and depending on how complicated and time-consuming they are, there are ways to make this essential duty easier for you. If you find yourself scrambling every year at tax time, you may also be missing out on some important benefits and ways to save your hard-earned money.
To help you get through tax season with ease, Connie’s Financial Services is offering their five best tips to help you get the most out of your tax return.
Tip #1 - Get organized!
Get a file or an envelope and label it "Important Tax Documents." Put it in a safe, important place that is easily accessible. Put all your tax receipts for medical visits and prescription costs, donations, childcare receipts, and income papers throughout the year in the file so that at year-end all your important documents will be in one place.
Tip #2 - Keep all medical receipts.
Medical expenses are a huge cost for some, which equates to a significant deduction at tax time. Keep all your prescription receipts, dental and eye care receipts. Most importantly, keep track of your medical travel. Have the doctor's office or hospital give you a letter stating you were at an appointment that day. With that letter, you can claim the per km travel rate for the trip. If you have to travel more than 40 km (one way) to see a specialist that is not available in your area, you can claim the travel. If it is more than 80 km (one way) you can claim $17 for a meal. CRA sets a medical travel rate each year (differs by Province) so you don't have to keep gas receipts. Also, keep the parking receipt for the visit.
Tip #3 - Save your donation receipts.
For donations totaling up to $200, you can get a tax deduction of 15%. If they total over $200, the amount over $200 is a tax deduction of 29%. You can save your donation receipts for five years, potentially saving you a lot of tax dollars.
Tip #4 - Don’t aim for a big tax refund.
Are you getting a huge refund? Sounds pretty good, doesn't it? Actually, it isn't. It means the government has been using your money for a year, for free! Not such a great deal for you. The ideal tax situation is to break pretty close to zero! Then you get to use your own money instead of the government.
Tip #5 - Invest in RRSPs.
Are you investing in RRSPs? What do you do with that refund you get? Consider investing it right back into an RRSP. By doing so, you are using those saved tax dollars to invest instead of "out of pocket" dollars.
If you’re still unsure about filing your taxes, reach out to the tax experts at Connie’s Financial Services in Oxford, NS. With over 60 years of combined experience, we provide tax accounting, payroll, bookkeeping, and tax preparation for both businesses and individuals. We’re dedicated to providing first class customer service to meet our client’s financial needs and exceed their expectations. Learn more about our services by clicking here or contact us here.