Record Retention

If you run your own business, you are required to retain books and records that relate to a specific taxation year for a minimum of six years after the date a tax return for that year has been filed. If a particular year is under appeal, books and records for that year should be kept until the appeal is disposed of and the time for any further appeal has expired.

Records include permanent records such as minutes of meetings, accounting records and source documents such as invoices, receipts, cheques, bank statements, etc. Paper source documents may be disposed of and their images kept as permanent records.

As records over six years old may contain information that is relevant for tax purposes, you may wish consult a Chartered Accountant or Canada Customs and Revenue Agency (CRA) prior to destroying the records. You may need permission from other government departments before you may destroy records related to those departments' activities.

Refer to the CRA Information Circular 78-10R3, which you can find on the CRA website at www.CRA-adrc.gc.ca.

The Institute of Chartered Accountants of Alberta provides information for Tax Tips as a public service.

Why File a Return?

Why fill out a tax return if you have no taxable income for 2003?

By filling out a return, you or your spouse may be eligible to receive monthly non-taxable Child Tax Benefit payments.

By filling out a return, you may be eligible for the Goods and Services tax and provincial sales tax credits for yourself and for each of your dependent children.

And finally, by filing a return, you'll recover any money owing to you for the year. This could include an overpayment for income tax, Canada Pension Plan (CPP), or Employment Insurance.

Even if you have no “Taxable Income”, you may be required to file a tax return and pay CPP if your net self-employed income is in excess of $3,500. You may also want to report this “earned income” so that you build your RRSP contribution room and be eligible for greater RRSP deductions in a future year. If you are a student with excess tuition/education amounts in the year, you would want to file a tax return so that you can carry them forward to another year. Also, if you have a business loss, you must file a return in order to establish your right to claim the loss in other years.

Tax credits, money owing—it's yours for the asking. Simply fill out a tax return.

The Institute of Chartered Accountants of Alberta provides information for Tax Tips as a public service.

Deadlines for Filing Your Tax Returns

The general deadline for filing personal income tax returns and paying any taxes owing is April 30th. However, if you are in business for yourself, the filing deadline for you (and your spouse) is extended to June 15th.

Just remember, any taxes you owe are still due by April 30th, so make sure you pay them by that date to avoid interest charges. If you owe taxes and your return is late, you will be assessed a penalty and interest on the unpaid balance of tax due.

If you find the deadline is fast approaching and you still haven't received receipts for some items, file your return anyway with a cheque for the estimated tax owing and an explanation. An adjustment may be made later.

The Institute of Chartered Accountants of Alberta provides information for Tax Tips as a public service.

Your Assessment Notice

When you are sent an assessment notice showing additional taxes payable, review it carefully; your arithmetic may have been wrong or you may have claimed a deduction that you weren't entitled to, or perhaps Canada Revenue Agency (CRA) has incorrectly denied a deduction that you are truly entitled to.

If your return was prepared for you, advise the preparer of any changes, up or down.

If you prepared your own return and don't understand the information on your notice, contact your local tax services office immediately for a full explanation.

If the assessment is not in your favour and you aren't satisfied with CRA's explanation, you may want to consult a professional advisor and consider filing a Notice of Objection with CRA to ensure that your rights are protected. Keep in mind individuals have until the later of (i) one year after the taxpayer's filing due date for the year in question, or (ii) 90 days after the day of mailing the Notice of Assessment to file the objection.