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T4 Slips and Tax Tips: Taking the Stress Out of Filing

By AMA Staff

One of the first signs of spring? T4 slips.

That’s right. Despite all that we endured over the past 12 months, tax season has now returned, too.

Whether you file online, by snail mail or use a tax professional, we want to make the experience as painless as possible. (Approximately 10 percent of Canadians still file paper returns, according to the latest statistics from the Canada Revenue Agency.)

While last year’s tax deadline was extended due to the economic pressures of the then-nascent pandemic, the federal government has now returned to its standard tax timeline: This year’s filing deadline is April 30, 2021.

HOW WORKING FROM HOME AFFECTS YOUR TAX RETURN
The biggest change for the 2020 tax year stems from the many Canadians who began working from home—turning their bedrooms, kitchens and living rooms into home office spaces to help slow the spread of COVID-19. While home-working may have been safe and convenient, from some, it also meant added expenses. To ease the burden on employees and businesses, the Canada Revenue Agency (CRA)

Has introduced a simplified process for claiming home office expenses on your 2020 income tax return.

If you worked from home 50% of the time (or more) for at least four consecutive weeks last year due to COVID-19, you qualify to claim a deduction of $2 per day, for all days worked at home in 2020, to a maximum of $400. This straightforward, flat rate method doesn’t require you to track your expenses or calculate the square footage of your home workspace.

The traditional, detailed method of reporting remains available, though it requires that you calculate all expenses and provide supporting documentation, and also get a completed and signed T2200S form from your employer. Refer to the CRA website for more information.

Though not everything can be claimed, some eligible home office expenses include electricity, heat, water and internet-access fees. To submit a home office expenses claim, using either the flat rate or the traditional method, simply fill out the new T777 form​ and apply it to your tax return.

WHAT ABOUT THE CANADA EMERGENCY RESPONSE BENEFIT?
Any CERB payments you received due to the pandemic need to be reported as income on your 2020 tax return. If you received the payments from the CRA, the amount will be noted in box 197 of your T4A slip. If you received CERB through Service Canada, it’ll be included with your regular Employment Insurance benefits in box 14 of your T4E slip.

Though unfortunate, some Canadians who received CERB payments were not actually eligible for them. If you’re among that group, you’ll have to repay the amount you were given. If you repaid your CERB benefit before December 31, 2020, you won’t need to pay tax on it when you file your return.

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ONLINE OPTIONS
• If you’re filing online, make sure the program is NETFILE-certified with the Canada Revenue Agency.

• A complete list of NETFILE-certified tax software is available via the CRA’s website: including free and paid programs from different companies.

• Compare programs before you start to prepare your taxes. Paid software features more options such as transferring last year’s tax data, unlimited tech support, access to tax experts, and adjusting previously filed returns.

SNAIL-MAIL SUGGESTIONS
• If you want to be able to track your mailed tax return, send it by registered mail. You’ll get a receipt noting the day your return was filed, plus the ability to track the package on its way to the CRA.

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• Send your return by April 30, 2021 to avoid late-filing penalties.

• Due to COVID-19, processing times for paper returns are longer this year—10 to 12 weeks instead of the usual eight weeks. That’s six times longer than digital returns. The CRA is encouraging Canadians to file electronically.

NEED HELP?
H&R Block offers basic tax prep starting at $49.99 (plus GST) until March 31, 2021. “Whether you upload your documents securely from home, drop them off at one of our offices or file online using our do-it-yourself software, we’re so confident that we’ll get it right, we offer a 100% Accuracy Guarantee and a Maximum Refund Guarantee, so you get back everything you’re owed,” says Kristi Rose, manager of business development for H&R Block.

HOW TO SAVE
Assisted tax filing
: Show your AMA membership and receive a discount on assisted tax filing at H&R Block. First-time customers save 20% and returning clients save 10%. Upload your documents securely from home or drop them off at an H&R Block office and a tax expert will prepare and file your return remotely.

DIY tax filing: Want to file your taxes yourself? AMA members can access H&R Block’s tax software at no cost. Plus, AMA members and their partner also save 20% on any 2021 H&R Block online tax software paid products.