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Tax season is formally upon us and Canadians can now file their 2023 private tax returns on-line. Right here’s what’s new for the 2023 return, and a few issues to remember as you get able to file.

The submitting deadline

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This 12 months’s basic tax submitting deadline is April 30, 2024. In case you or your partner or associate have self-employment earnings, your submitting deadline, which is generally June 15, is prolonged by two additional days in 2024 to June 17, since June 15 falls on a Saturday this 12 months.

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In both case, when you owe tax for 2023, any stability due have to be paid by April 30. After that date, the Canada Income Company expenses non-deductible arrears curiosity at a price of 10 per cent, compounded day by day. That is the highest price in additional than 20 years.

Paper returns getting thinner

Greater than 90 per cent of Canadians file their returns electronically, however when you’re one of many two million Canadians who nonetheless file a paper return, you need to have already acquired your 2023 tax bundle within the mail.

You’ll have observed, nevertheless, that this 12 months’s bundle is thinner than regular. In line with the CRA, that’s as a result of the company is not printing line-by-line directions for the paper bundle. By making this transformation, the CRA has decreased every bundle by roughly 30 pages, or about 20 per cent. The road-by-line directions are nonetheless out there on-line.

Discover of Evaluation (NOA)

Your NOA is a abstract of your tax return that the CRA sends out annually as soon as your tax return has been assessed. The NOA exhibits the date your return was processed (necessary in case you wish to formally object to your evaluation by the deadline), and the main points of how a lot tax you owe or the quantity of refund you could be receiving. Final 12 months, greater than half of Canadians acquired a refund, with the typical quantity being $2,262.

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This 12 months, when you’re anticipating a refund however you’re not signed up for direct deposit, you’ll obtain a paper T1 NOA and cheque individually. The CRA has additionally made adjustments to the T1 NOAs “to supply extra full info that’s simpler to grasp.” For instance, the CRA just lately up to date the registered retirement financial savings plan desk included as a part of your NOA.

Working from house

In case you labored from house in 2023, you could be entitled to write off your home-office bills. For the 2023 tax 12 months, the CRA has said you can be certified to jot down off your home-office bills if your private home workspace is the place you “principally” — which means greater than 50 per cent of the time — carried out your duties of employment for a interval of at the least 4 consecutive weeks throughout 2023.

Sadly, the CRA has scrapped the simplified technique for home-office bills which allowed staff working from house to say $2 per day, as much as $500. For 2023, you’ll have to calculate your precise home-office bills and pro-rate them in accordance with work use.

You’ll additionally have to get a signed copy of CRA kind T2200 Declaration of Situations of Employment out of your employer. The T2200 will not be submitted along with your return, however you’re required to maintain it in case the CRA asks to see it later.

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First Dwelling Financial savings Accounts (FHSA)

In case you contributed to or withdrew cash from the brand new FHSA in 2023, you need to have acquired a T4FHSA (First Dwelling Financial savings Account Assertion) exhibiting the quantity you contributed or withdrew in 2023. The utmost contribution quantity was $8,000, and you may select to deduct the whole contribution in your 2023 return, or you could want to defer claiming the deduction to a future 12 months if you’re in the next tax bracket and the deduction could also be value extra.

To report FHSA actions in your 2023 return, there’s a brand new kind, Schedule 15, FHSA Contributions, Transfers and Actions. This schedule is used to inform the CRA that you just opened up an FHSA in 2023 (step 1), that you just made a contribution final 12 months (step 2), that you just’re claiming a deduction in 2023, or saving a few of that deduction for a future 12 months (step 3) and whether or not you made a qualifying withdrawal in 2023 to purchase your first house (step 4).

Multigenerational house renovation tax credit score

Among the many 2023 tax adjustments that took impact for this 12 months is the brand new Multigenerational Dwelling Renovation Tax Credit score. This refundable credit score was launched to help Canadians with the price of renovating a house to create a secondary unit so {that a} member of the family who’s greater than 65 years of age (or 18 in the event that they qualify for the incapacity tax credit score) can reside with you. The credit score is obtainable for renovation bills incurred in 2023 and past.

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A “qualifying renovation” is a renovation, alteration or addition made to your private home that’s of a permanent nature and integral to the house. The renovation have to be undertaken to ascertain a secondary unit inside your private home through which your relative could reside. A secondary unit is a self-contained housing unit with a non-public entrance, kitchen, rest room services and sleeping space. It may be both newly constructed or created from an current dwelling house that didn’t already meet the native necessities to be thought of a secondary dwelling unit.

If eligible, you’ll be able to declare as much as $50,000 in qualifying expenditures for every qualifying renovation accomplished, as much as a most credit score of $7,500 for every declare you’re eligible to make. The declare is made on new Schedule 12, Multigenerational Dwelling Renovation Tax Credit score.

Anti-flipping rule

Beginning Jan. 1, 2023, any acquire from the disposition of a housing unit (together with a rental property) positioned in Canada that you just owned or held for lower than a 12 months earlier than sale is deemed to be enterprise earnings, not a capital acquire. It’s additionally not eligible for the principal residence exemption. There are, nevertheless, sure exceptions to this rule, similar to within the case of demise, incapacity, separation and work relocation.

Compensation of COVID advantages

In case your COVID-19 advantages had been denied and also you had been required to repay them in 2023, they are often claimed as a deduction on line 23200 of your 2023 return.

Jamie Golombek, FCPA, FCA, CFP, CLU, TEP, is the managing director, Tax & Property Planning with CIBC Personal Wealth in Toronto. Jamie.Golombek@cibc.com.

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