The colour of the leaves begins to turn and the days are becoming shorter and
cooler, a sign that summer is approaching its conclusion and that it is
time to start preparing for your 2020 Tax Return.
Covid has brought about some major changes to individuals and families
daily living and these changes may potentially impact tax filing for the year
2020 and beyond.
Working from home, you may feel the need for a larger accommodation. Here
is where an RRSP can assist greatly.
Contribute as much as you can (within your contribution limit) and then use
your RRSP funds, via the Home Buyer’s Plan to use towards a down
payment and get a tax relief in the year of the contribution.
Covid has also created havoc in some specific industries and many are in a
position where they must enhance their skills and/or education, to reach the
position or income desired. Here too, an RRSP maybe the answer. Contribute
and then use the RRSP for the Lifelong Learning Program and get a Tax Relief
in the year of the contribution.
In some households Covid has increased the savings due to reduced
living expenses. Set aside these monies for the future in the form of
contributions to an RRSP and/or TFSA.
If you are working from home, get your employer to provide you with a T2200
(Condition of Employment form.) Use the form within the constraints for your
2020 Tax Filing. One will need to accumulate all the documentation
namely, rent/mortgage interest or utilities.
Self-employed, commissioned employees and commission agents
should start preparing and collecting receipts. This group of people have the
most to gain and yet in my experience tend to be rather carefree in regard to
record keeping.
Here is a list of expenses that may be covered and need to be kept for record
keeping.
-Automobile: includes lease payments, gasoline, repairs and maintenance,
parking, 407, car washes, insurance and interest payments.
– Home office: Mortgage interest/ rent, utilities, property taxes (commission
agents only) and repairs and maintenance.
Rattan Gandhi is owner of Quick Refund Tax, 133 Sixth St. His opinions
stem from 15 years of experience in
helping clients in the tax area. If you
have questions, he can be reached
at 905-616-5253 or
rattangandhi@gmail.com.