Learn important information related to Tax Prepping
Complete the proper forms:
- Make sure that when submitting a Tax ticket that there is a "Personal Information Prep Form"
- When there is more then one document, ensure that all the files are submitted in a zipped folder
Please ensure that when you are submitting each Tax Preparation request, you are uploading a single zipped folder (compressed file) for the entire household containing all the required documents. Once that has been created, have an individual subfolder created for each taxpayer within the zipped folder.
For help on creating zipped (compressed) files, view the below resources:
- A best practice is to complete spouse returns together rather than separately. This ensures all deductions are being captured and minimizes the risk of a reassessment due to duplication.
- Furthermore, if we are not completing a spouse's return, ensure their net income is reported on the taxpayer's Prep Form.
- Only submit Tax Preparation request once the client has provided you with all of their expected tax slips
- We’ll need to know if the client held any foreign property, where the aggregate value of that property exceeded $100,000 at any point in the tax year. If the foreign property is greater than $100,000 but less than $250,000 at any point in the year make sure to fill out the Foreign property box in the Personal Prep Form.
Timeline:
- April 1st is the recommended final date for prep form submissions.
- April 27th is the last day to approve Tax Returns to be filed from the email provided to your team.
Different Types of Forms:
- Personal Prep Form: Please complete one of these Prep Forms for each taxpayer that a tax return is being prepared for.
- Commissioned Employee Expense Prep Form: To be completed for each taxpayer who is an employee, who has received commissions or who has incurred expenses during the year as a direct result of their employment.
- Business or Professional Income Prep Form: To be completed if a taxpayer’s income is generated by a small business/sole proprietorship, or as a result of being paid commissions (but not as an employee).
- Home Office Expense Prep Form: To be completed if a taxpayer has home office expenses that are to be deducted from their employment income and have a signed T2200 from their employer.
- Real Estate Rental Prep Form: To be completed if an individual owns one or more rental income properties which are to be claimed on their personal tax return. Please note that one Prep Form needs to be completed for each rental property owned.
Claiming Expenses on Rental Properties:
Claiming expenses is a great way to reduce your taxable rental income, but not all deductions are created equal. While some expenses can be written off in their entirety, others can only be claimed, in part or over time. Here’s the breakdown:
- Operating expenses: Also referred to as “current expenses”, are the day-to-day costs related to the income property that have short term value and are incurred in the taxation year. These could include minor repairs, maintenance, advertising, etc.
- Capital expenses: Capital improvements that add long-term value to the property, such as permanent additions to the building or structural improvements. These expenses aren’t immediately deductible, but rather written off over time by claiming Capital Cost Allowance (CCA).
- Prepaid expenses: Rental property expenses that are paid ahead of time, such as a home insurance premium for the year, are indeed deductible. But only the part of the premium that covers the rental period you are claiming on your taxes.
- Interest and fees: Deduct interest on whatever money you borrow to purchase or improve your rental property. You can also deduct the interest you pay to tenants on their rental deposits.