The tax filing deadline of April 30 is fast approaching – have you started preparing your taxes yet? If your taxes are pretty straightforward, consider yourself lucky. For example, if you’re a salaried employee with tax slips, there’s nothing stopping you from filing your own taxes. It’s a good learning experience and a good way to save money. But not everyone’s taxes are so simple. For example, if you’re self-employed or own a rental property, filing your taxes is more complicated since the tax deductions aren’t always so black and white.
RedFlagDeals.com, best known for helping Canadians save a buck or two online through coupons, sales and promotions, uncovered some fascinating tax trends for Canadians filing their taxes. In the midst of tax filing season, the deal website released survey results on how Canadians feel about communication and service from the Canada Revenue Agency (CRA) aka the taxman.
The Information Gap
Completing your tax return for the first time can seem daunting. Not surprisingly, many Canadians feel unprepared to successfully make the most of their tax return. While the CRA is there to help facilitate the tax filing process, the government agency doesn’t seem to be making it any easier. Over a third of those surveyed said the CRA doesn’t provide enough resources and information to let them to do their own taxes.
That’s not all. Doing your own taxes can be intimidating. When you have a question, where do you turn? While 32% of those surveyed said they turned to the services of a broker for help with their tax return, over half (57%) used online forums or research on the world wide web to get advice on their tax return.
Put Your Refund to Work
Many Canadians who get a refund from the taxman view the money as a windfall. So what are Canadians doing to make the most of this so-called found money? Thirty-six percent used the money to pay down debt, while another 36% used the funds to contribute to their RRSP, TFSA, or other savings accounts. With the household debt-to-income ratio hitting a new record high of 165.4% in the fourth quarter, it’s sobering to find out at least some Canadians are making debt repayment a priority (instead of using it as an excuse to pile on more debt).
Looking Online for Answers
For those Canadians who choose to complete their own tax returns, many are turning to online publications and blogs for information on the tax filing process. Of those surveyed, 61% reported to reading informational articles and getting advice on online forums, such as open discussion forums and peer-to-peer advice, before or while completing their tax return.
Seeking a Connection
So why aren’t more Canadians reaching out to the CRA? It could be something to do with the fact that it’s not always easy to reach the tax agency. If you can't get through trying to call the CRA, you’re not alone, as the Toronto Star recently discovered two-thirds of all calls get the busy signal.
In 2014-15, of the 60.1 million calls made to the CRA, only about a third went through on the first try. Two-thirds or 40.9 million got the busy signal. That means nearly seven in 10 callers to the CRA get the busy signal. How rude! This could be why so many Canadians are turning to other sources like blogs and online forums to get help on their taxes.