Everyone except a dependant such as your infant child or teenage child who depends on you for financial support, has to file an income tax in Canada. If you child at any age starts earning money on his own, he or she will need to file an income tax then. Even if you don't have any income at all, you will be required to file taxes so that you could possibly claim for the quarterly GST/HST payments and other claims.
A lot of people surprisingly doesn't know or they don't trust themselves in filing taxes on their own. They prefer going to an accountant to file their taxes thinking it is better that way. The fact is it is very easy to file your own income tax if your situation is very simple and straightforward.
Lets say you earned income in the previous year and this current year you are filing your income tax for last year.
1. You will receive a document called T4 from your work employer around mid February or end of February
2. If you invested your money in an investment account and you earned more than $50 throughout last year, then you get a T5 statement from your bank where you invested your money.
3. If you donated money to some charity organisation, you will get a donation receipt showing you the amount you contributed to that organisation
4. If you had spend money on medication and drugs, keep your bills since you will need them to file some medical claims.
5. If you have paid tuition fees, you will get a statement from your college, university or educational institute showing the amount of money you spent on education tuition fees as it is called. You can claim this amount while filing your income tax.
6. With the above documents in hand you are ready to file your own taxes. Some of the popular tax Softwares are UFile and Turbotax. There are other tax Softwares too but they are not that popular or not as easy to use. Some of the tax Softwares are free and doesn't require you to purchase them. Even UFile and Turbotax has the free versions too, provided your income for that year is less than $20,000. Students file for free with UFile regardless of their income amount. You can download the tax software online or buy the tax software CDs from any departmental stores in your local area.
7. When you open your tax software, you will need to enter your personal details about yourself, your spouse or any Dependant you may have.
8. You can either use the in built "Download T4" into your tax software or you can manually enter all the T4 (Work Income Document) Details.
9. Based on your situation you can enter details such as investment, donations, medical expenses, tuition fees, RRSP, Rental income, Capital gains.
10. Once you are done entering those information into the tax software, the tax software does all the hard work with calculations and shows you how much tax refund or tax owing. It also provides you with tips and suggestions on topics related to your situation. Once you are satisfied that ll information you have entered is correct, you can "Netfile" your tax return online which means you can send your completed income tax return directly to the Canada Revenue Agency using this tax software.
11. Remember to also complete the section for your spouse and dependant children before you "Netfile" your income tax return. You may have to "Netfile" for youself, your spouse and your children, one at a time. So if you have 3 person's taxes you are filing, then you will have to "Netfile" three times. You will see the "Netfile" options beside each of your family members name except if your dependant children has no income and still depends on you for financial support.