If you’re an employee who pays for various work-related expenses that your boss doesn’t cover, you may be able to get some tax relief when you file your 2018 tax return by claiming a deduction for valid employment expenses.

Typical, deductible employment expenses can include: accounting, legal, advertising and promotion fees, allowable motor vehicle expenses, certain food, beverage, and entertainment expenses, out-of-town lodging expenses, parking, postage, stationery and other office supplies.

But before trying to claim any of these employment expenses on your return, be sure to get a copy of a properly completed and signed Form T2200, “Declaration of Conditions of Employment.” Your employer must complete this form for you to be able to deduct employment expenses from your income. While you don’t need to file this form with your return, you’re supposed to keep it in case the Canada Revenue Agency asks to see it. If you get audited by the CRA, the failure to have a completed, signed T2200 from your employer can lead to your employment expense deduction being denied, as was the case with a taxpayer who found himself before the Tax Court of Canada.

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The beginning of March marks the end of RRSP season and the start of tax season. The Canada Revenue Agency began accepting electronic returns as early as last week. Last year, nearly 90 per cent of the over 29 million returns Canadians filed were completed online. Let’s take a look at what’s new this tax-filing season and provide some tips to help you start your return.

The deadline

Most Canadians’ tax returns are due on April 30, 2019. If you or your spouse or partner are self-employed, you have until June 15, 2019 to file your returns; however, since June 15, 2019 falls on a Saturday, the CRA will consider your return to be filed on time as long as the CRA receives it by (or it’s postmarked by) midnight June 17, 2019. Note that any balance owing is still due by April 30, 2019.

Tax rates

The federal tax rates on your 2018 return haven’t changed at all from the prior year, although the brackets have been indexed to inflation by 1.5 per cent over 2017. The lowest bracket last year – 15 per cent federally — was for taxable income up to $46,605. Combined with provincial or territorial tax, that resulted in a combined rate of anywhere from 19 per cent in Nunavut to 30 per cent in Nova Scotia.

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Many people were upset with Prime Minister Justin Trudeau this week for saying “low-income families don’t benefit from tax breaks because they don’t pay taxes.”

Of course, some were upset because they felt it was untrue. But Trudeau was speaking the complete truth when it comes to income taxes (HST, realty taxes and other consumption taxes are another story). It is just a truth that he may not want many Canadians to know.

On average, two of every five Canadian households do not pay anything towards federally and provincially funded expenses such as health care, education, community and social services, national defence, public safety and even the good old Canada Revenue Agency. One household of every five pays much more than 70 per cent of all of those costs.

It didn’t used to be this way, but it is now.

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This week, the Canada Revenue Agency held a media briefing to usher in the beginning of the 2019 tax filing season. But unless you’re certain that you’ve already received all of your tax slips for 2018, you may want to hang on a bit before filing your return.

While waiting for those remaining slips to arrive, take some time this weekend to get organized, making sure you have the necessary receipts to back up all your deductions and credits. Failure to provide proper receipts to the CRA could not only lead to a denied deduction, but could also result in a gross negligence penalty, as an Ontario taxpayer recently found out.

The case, decided last week, involved the child care deduction and illustrates the importance of getting appropriate receipts to back up your claim. The taxpayer has five children, but only her youngest two children lived with her from 2003 to 2007, the tax years under review.

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Two-time heavyweight boxing champion and, later, grill aficionado George Foreman once quipped: “The question isn’t at what age I want to retire, it’s at what income.”

A new CIBC retirement poll out this week found that 74 per cent of respondents worry about having enough income in retirement. According to the poll, Canadians’ top anticipated sources of retirement income include: Canada/Quebec Pension Plan benefits (85 per cent), Old Age Security benefits (80 per cent), RRSPs (63 per cent), TFSAs (58 per cent) and income from a pension plan (53 per cent).

Yet the vast majority of those surveyed — 89 per cent — didn’t fully know how their retirement income is taxed, which may result in lost opportunities to claim various tax credits or implement strategies that might save thousands of tax dollars annually.

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