Tax FAQ - 2023 Tax Year (Saskatchewan)
Preparing for taxes can often leave you scratching your head with questions. We hope some of the questions answered below make things just a little easier to understand.
I'm over 18 and didn't make much, if anything. Should I still file a tax return?
Indeed you should! Filing taxes will register you for government programs such as the Saskatchewan Low Income Tax Credit ($380 for an individual), the GST credit ($496) as well as the Climate Action Incentive Rebate ($680). That’s $1556 to start off your retirement savings!
Can I claim expenses for my vehicle?
If you just travel to your usual place of work and back, none of those expenses are claimable, even if you’re on contract income. So when can you claim costs for running your own vehicle? If you’re an employee, your employer has to fill out form T2200, which declares you had to use your vehicle for work purposes, and you didn’t get reimbursed. Then, you have to keep track of your total kilometers for the year, and the amount you used for work purposes, as well as your fuel, lease, interest, insurance, maintenance, and perhaps depreciation expenses. The same kind of record keeping has to go into using your vehicle for business purposes, but you don’t need form T2200. You can’t just claim a rate per km as CRA may deny the vehicle claim without the detailed record keeping.
What kind of work at home expenses can I claim?
There’s a few things to keep in mind. First, there are no Covid-19 claims you can make for 2023. If you have an arrangement with your employer to work at home, you will have to get your employer to fill out form T2200. Then you may calculate your workspace vs your home area, and track amounts spent on your utilities and internet.
If you are self-employed and use your home for work, claims can be made for the portion of the house that is used. You can claim utilities as well as mortgage interest costs.
I know someone who may be entitled to a Disability Tax Credit Certificate (DTC). Can they apply directly to CRA?
Yes, and they should, if their functions are limited in hearing, walking, eliminating, feeding, dressing or mental functions. The doctor will fill out a form, and it is submitted to CRA for their final approval. Talk to us if you have further questions about the process.
Why doesn't Amity offer instant tax refunds like other companies?
In short, we think it’s a terrible deal for you. If you get an average refund of $1895, you’ll pay $125 for the “privilege” of an instant refund with one of the big tax service providers. That’s a 7% hit -- calculated yearly, it’s an interest rate of over 200%. If we e-file your return, you usually wait just 10 business days and the full refund will be direct deposited in your account.
I earned only some money on the side, do I have to report it?
If you earned anything where you made a profit, even a few dollars, it’s reportable. If, however, you received some income from an activity where you always spend more than you make you don’t have to report it. Another example where you need not report is where your child or sibling pays you something for living with you, but you receive nothing near what it costs. That’s considered a cost-sharing arrangement.
I submitted medical expenses. Why don't I see them on my tax return?
In most cases, medical expenses must reach a threshold of 3% of net income, or, if you’re married, 3% of the spouse with the lower net income. If your net income is $40,000, you would have to spend more than $1200 on medical bills to begin to see the credit apply. Sometimes it makes sense to use a 12-month rolling period including the year prior to reach the threshold.
I’d like a larger tax refund. What's the best way to do that?
Each situation is unique, but here are some general guidelines.
If you haven’t purchased a house, or haven’t owned a house in the last four years, a very nice option is investment in a First Home Savings Account (FHSA). You can deduct up to $8,000 of income for contributions and even if you don’t purchase a house within 15 years the amount can be rolled into a Registered Retirement Savings Plan (RRSP).
Another option is to make RRSP contributions, which are deducted from your income. Generally, if you make over $52,000 a year, this can be useful. Remember, when you withdraw it, you will pay taxes on those amounts, but you may well be in a lower tax bracket.
One other option is to donate to a registered Canadian charity. Donations over $200 get a tax credit of about 44%, so you can allocate your dollars to the causes you like best!
Don’t forget the trusty TFSA (Tax Free Savings Account). You can shelter income you receive from interest and stock market returns, and you may be able to contribute up to $95,000.
What happened to the Saskatchewan Home Renovation Tax Credit?
It went away. The last year to claim expenses was for 2022. If you missed listing those, and the amount was over $1,000, you can file an adjustment for a refund on taxes owing.
How can I get $2,000 of tax-free income after I'm 65?
If you are taxable, and you don’t have any pension or RRIF income (CPP does not qualify), convert $2,000 of RRSP to RRIF. Then, make a RRIF withdrawal of $2,000. That $2,000 is eligible for the “pension income amount”, which is a $2,000 tax credit, essentially offsetting the RRIF income.