New Immigrants and Income Tax in Canada
Information about Income Tax filing is one of the first piece of information that new immigrants to Canada should know about. Though taxes in Canada are considered to be “high” in comparison to many other first world countries, the fact is that paying taxes is important and it helps the Canadian Government with providing the facilities to Canadians that people in most countries would consider a luxury.
Your income tax is deducted on the amount of your income. If employed, your tax will be deducted from every paycheck you receive. During tax filing, it can be determined if you have paid too much or too little tax. If you have paid too much tax, you get a refund from the Canadian Government and if you have paid less taxes then you have to pay the remaining tax to the Canadian Government.
Do you have to file income tax?
You must file an income tax return if you:
- Owe tax
- Want to request a refund
In case if you have no income or no tax to pay, you may still file tax return because you may be eligible for certain payments or credits like:
- the GST/HST credit.
- CTBT (Canada Child Tax Benefit) payments;
- Universal Child Care Benefits; and
- provincial or territorial tax credits.
For more information please visit Canada Revenue Agency at www.cra.gc.ca.
Which tax package?
As a newcomer to Canada, you should know that most individuals who are Canadian residents file only one income tax return for the tax year. Government of Canada collects taxes on behalf of all provinces and territories except the Province of Quebec.
When filing the income tax return for the tax year that you are a newcomer to Canada and for each tax year that you continue to be a resident of Canada, use the General Income Tax and Benefit Package for the province or territory where you lived on December 31 of that tax year.
It is important to use the income tax forms of your province where you lived on December 31 of the tax year because the tax rates and tax credits are different in each province.
If you lived in the province of Quebec you may need to file the separate provincial income tax return. For more info www.revenuquebec.ca
Tax Filing due dates
Following are the important filing due dates, file on or before the due dates:
- Personal Income Tax due date April 30 of the year after the tax year; or
- If you or your spouse or common-law partner carried on a business in Canada (self-employed), the tax return has to be filed on or before June 15 of the year after the tax year.
Note
If you owe tax on personal income tax or self-employed tax return, the tax has to be paid on or before April 30 of the year after the tax year, regardless of the due date of the tax return.