How to survive tax season as a working holidaymaker in Canada

Tax season can be stressful at the best of times for anyone, but it can be a particularly daunting prospect for working holidaymakers in Canada.

Why? Well, with unfamiliar tax laws and regulations, it’s only natural that working holidaymakers would have questions on their requirements to stay tax compliant in Canada.

That’s why we have teamed up with the tax experts at Taxback to bring you these tips that will provide you with what you need to know to survive tax season in Canada!

Who needs to file a tax return?

If you’re a working holidaymaker in Canada, you’ll likely need to file a tax return.

The prospect of filing tax paperwork is off-putting for many. However, the good news is, by filing your tax return, you can ensure you receive any Canadian tax refund you are due!

The tax deadline in Canada is 30 April of each year.

Filing on time is key to being tax compliant with the Canadian Revenue Agency (CRA).

What do I need when filing?

To file your tax return in Canada, you’ll need a few important documents.

These include:

T4 slip: This slip shows your employment income and deductions.
T4A slip: This document outlines income from other sources, such as scholarships, bursaries, or grants.
your Social Insurance Number (or SSN)

Also, if you’re claiming any tax deductions or credits, you will need to provide receipts as evidence.

Could I be due a tax refund?

As a working holidaymaker in Canada, there’s a good chance you may be eligible for a tax refund!

However, exactly how much you can claim will depend on a number of factors, including how much tax was withheld from your payslip and whether you’re eligible for any tax credits or deductions.

The average Canadian tax refund a working holidaymaker who applies with Taxback receives is $998!

Some common tax credits and deductions that may be relevant for you include:

Tuition and education credits: Were you were enrolled in an educational program during the tax year? You may be eligible for this credit.
Medical expenses: If you had any medical expenses that weren’t covered by your provincial health plan, you may be able to claim them as a deduction.
Charitable donations: If you made any donations to a registered charity, you may be able to claim them as a deduction.

Remember, you will need receipts as evidence of these expenses in order to be eligible to claim your tax back.

What happens if I don’t file?

As previously mentioned, it is very important that you file your tax return correctly and on time.

This is especially true if you underpaid tax, meaning you now owe tax to the CRA. If you owe tax and don’t file your return on time, you may be subject to a late-filing penalty of up to 5% of your balance owing, plus an additional 1% for each month your return is late, up to a maximum of 12 months.

Interest charges will also accrue on any tax owing, starting on 1 May after the deadline.

Who can help me with Canadian tax?

It’s true, you can file on your own. The main advantage here is that it’s free. However, you alone will be responsible for ensuring that you are tax compliant and claiming every entitlement you’re due!

You’ll also have to ensure all of that boring paperwork is completed correctly.

However, why not let a professional take control of your tax affairs so that you can focus on other matters?

If you’re looking for more personalized assistance, you may want to consider using a tax specialist like Taxback.

Taxback will ensure you are fully tax compliant and guarantee you get your MAXIMUM tax refund through all your deductions and credits.