Tax Refund - am I missing something?

[tiger_handheld]

OK. here is the deal
2006:
NI from job ~ 12.5K
Income from Heritage scholarship grant - 2.5K
total taxable income 15k + < $50 interest from mutualfunds


Deductions:
Charity ~ 1210
BC Transit Passes 552
RRSP about - 650
Tuition - all fulltime credits ( took 6 full time classes)

Tax Refund - 786.xx
------------------------------------------

Tax Year 2007
NI from Jobs - ~ 11K
Total Taxable income 11K + <$50 from interest from mutual funds

Deductions
Charity ~ 1100
BC Transit Passes 828
RRSP about - 685
Tuition - all fulltime credits ( took 7 full time classes)

So far my tax refund = $180

Why the HUGE difference ? ?

i used quick tax to do this .. i filled in everything just like last year ... but very disappointed .. lol

[ZxExN]

You might want to look at the T4 slip as to see how much tax you paid. Also 180 looks pretty low for your situation. You might've done something wrong.

[bobbycat]

maybe you forgot to add Income Tax Deducted?

[Thalo]

Why the *&#% are you donating over $1000 a year to charity when you're in school and hardly earn anything? Wait till you're working full time to do that. Heck, I can't even fathom donating that much on my income.

[j27lee]

Why the *&#% are you donating over $1000 a year to charity when you're in school and hardly earn anything? Wait till you're working full time to do that. Heck, I can't even fathom donating that much on my income.

Maybe he cares about more than himself?

[masterballer]

Maybe he cares about more than himself?

come again?

[don242]

How much tax did you have deducted in 2006 as compared to 2007?

[dutchca]

You simply paid less tax in 2007 than 2006 and are getting less back. You can only get back the tax you pay and nothing more.

Your situation opens up tax planning possibilities though - you are most likely not using all your non-refundable tax credits and probably should not be claiming the RRSP contribution as a deduction in 2007.

Think about it this way - you simply loaned the CRA less money interest free in 2007.

[tiger_handheld]

im carrying fwd all my RRSP/tuition credits / charitable donations ... not claiming any of this.

Thalo- As for donating to charity - its what i believe in and nothing has ever gone wrong...... out of curiosity what is your income? that you cant donate 1g to something you believe in ?


what do you mean by not using all my non-refundable tax credits ? What are those?

[jeeva86]

your income tax deducted was probably around 180 or you entered this info incorrectly.

[tiger_handheld]

what should my return be around? any tax whiz care to guesstimate ?

[Piccolo]

what should my return be around? any tax whiz care to guesstimate ?
Did you remember to claim your base personal amount of $9600?
I am not a tax wiz, but based on the information you have porvided, the amount of your return seems ... low. An error I did one year while calculated my taxes (I do my own always) is I neglected to claim my base personal amount. Once I realized that error the amount to be refunded to me was conciderably higher.

[Piccolo]

im carrying fwd all my RRSP/tuition credits / charitable donations ... not claiming any of this.

Thalo- As for donating to charity - its what i believe in and nothing has ever gone wrong...... out of curiosity what is your income? that you cant donate 1g to something you believe in ?

what do you mean by not using all my non-refundable tax credits ? What are those?
Non-Refundable tax credits means that unless you have tax payable for the current year there is no benifit to these deductions. Tax payable is based on your net income. So if you have no income then the non-refundable tax credits are not a benifit to you. Where as a Tax Credit is not based on tax payable/net income.

[asdfvcx]

what should my return be around? any tax whiz care to guesstimate ?
As it's been explained a number of times, the most you can get for a refund is the amount you have already paid. None of us know how much taxes you paid last year.

Look at your T4 slips and see how much income tax was deducted. You will likely be getting it all back.

[Piccolo]

As it's been explained a number of times, the most you can get for a refund is the amount you have already paid. None of us know how much taxes you paid last year.

Look at your T4 slips and see how much income tax was deducted. You will likely be getting it all back.

Not necessarily. You can get a refund even if you paid $0.00 in taxes (becuase you didn't make any money) The refund will be based on your Tax Credit.

[dutchca]

Non-refundable tax credits are those tax credits you have in a year that can not be carried back to a previous year or carried forward to a subsequent year.

The basic personal amount is a perfect example of a non-refundable tax credit. An example of not fully utilizing a non-refundable tax credit is making less than $9600 in a year. You won't be able to use the full benefit of the basic personal amount as you can't carry it back or forward.

You are doing the right things by backing off on your donations etc. as they are a refundable tax credit that can be carried forward for a period of time - I forget how long - 5 years come to mind, but that may be wrong.

[dutchca]

Not necessarily. You can get a refund even if you paid $0.00 in taxes (becuase you didn't make any money) The refund will be based on your Tax Credit.

Please provide an example - the only refund you can get without actually paying tax is the sales tax credit and maybe the Ontario tax credit for rent/preoperty tax. Is that what you mean?

[Piccolo]

Non-refundable tax credits are those tax credits you have in a year that can not be carried back to a previous year or carried forward to a subsequent year.

The basic personal amount is a perfect example of a non-refundable tax credit. An example of not fully utilizing a non-refundable tax credit is making less than $9600 in a year. You won't be able to use the full benefit of the basic personal amount as you can't carry it back or forward.

You are doing the right things by backing off on your donations etc. as they are a refundable tax credit that can be carried forward for a period of time - I forget how long - 5 years come to mind, but that may be wrong.

you are .. partially correct. However, Tuition and Charitable contributions are still concidered non-refundedable tax credits only becuase they can only be applied to tax payable. They are the only two non-refundable tax credits that can be carried over. Part of the definition of a non-refundable tax credit is that there is no-carry over (with the exception of tuition and charitable contributions) so I can see where you got confused.

[CSK'sMom]

I'd love to know as well. As a SAHM with $0 income I have never recieved a refund.

[Piccolo]

Please provide an example - the only refund you can get without actually paying tax is the sales tax credit and maybe the Ontario tax credit for rent/preoperty tax. Is that what you mean?

That is exactly what I mean. Perfect Example :)
If you are a student living off osap and parents $$ and you pay rent. You can get a tax refund even if your income is $0.00 and there for no tax payable.

[Piccolo]

I'd love to know as well. As a SAHM with $0 income I have never recieved a refund.

Ontario Property Tax Credit and Ontario Sales Tax credit are not applied to tax payable so if you had no source of income you could get a refund *if applicable*. I appologize if this does not apply to you because you are not in Ontario. I know this is a Canada wide site. I am only familiar with my own province and my knowledge is limited.

[yodiyokun]

Why the *&#% are you donating over $1000 a year to charity when you're in school and hardly earn anything? Wait till you're working full time to do that. Heck, I can't even fathom donating that much on my income.

The guy, is paying his tithe - 10% of what he earns.

I do it too - and boy it's definitely worth it.

[Krox]

Ontario Property Tax Credit and Ontario Sales Tax credit are not applied to tax payable so if you had no source of income you could get a refund *if applicable*. I appologize if this does not apply to you because you are not in Ontario. I know this is a Canada wide site. I am only familiar with my own province and my knowledge is limited.

In the case of CSK'sMom, she won't get the refund b/c she is married and most likely her husband makes enough money so she won't qualify. The ontario property tax credit is like the GST credit, it only applies to low income people and your spouse's income is counted.

[CSK'sMom]

What is actually is is that in cases of married or common law couples the partner with the higher income must claim these credits for both partners...

[Piccolo]

So tiger_handheld.
Did you figure it out?

[Piccolo]

What is actually is is that in cases of married or common law couples the partner with the higher income must claim these credits for both partners...

SAHM. Single at Home Mom. ie. unmarried??
Does that mean you still have to file jointly with your exhusband becuase there are dependants involved?

I only had to file jointly for 3 years and because I was unfamilar with the process I used a tax program to guide me through it. Before that I was a single, poor student living off OSAP and paying rent. I got a refund.

I am currently trying to find out as much as I can about taxes and gathering as much knowlege in as many sources as possible.

[Kommander_KornFlakes]

You might've done something wrong.

No, not him, the idiot that did his return. I lost thousands of $$$ in 10 years of doing income taxes because none of the idiots whom I paid to do my income tax told me that I could claim my gas & insurance on my form, losing more than $750 a year in all those 10 years. Only until a real wise tax preparer told me did I do it and my tax return had an extra $750 every year.

Be careful who does your income tax, and NEVER use those "professional" office places to do your income taxes, they suck, and because you are just another schmuck with a number, they want to do you fast and get you out of their office to do the next dummy. Do your income taxes with free agents working out of their apartments, they will get more money for you and will deal with you personally asking more questions to maximize your return.

[dlander]

Please provide an example - the only refund you can get without actually paying tax is the sales tax credit and maybe the Ontario tax credit for rent/preoperty tax. Is that what you mean?

I can think of a few more "refundable tax credits".

Political contribution tax credit

Refundable medical expenses supplement (for those with low income + high uninsured medical costs)

Flow-through shares credit (for those who invest in early stage mineral exploration).


And the obvious ones:
Property tax credit
Provincial Sales tax credit
GST credit

[don242]

No, not him, the idiot that did his return. I lost thousands of $$$ in 10 years of doing income taxes because none of the idiots whom I paid to do my income tax told me that I could claim my gas & insurance on my form, losing more than $750 a year in all those 10 years. Only until a real wise tax preparer told me did I do it and my tax return had an extra $750 every year.



How are you claiming your gas and insurance? Is the vehicle used for your own business or nonreimbursed work related use? I am just curious.

[dlander]

How are you claiming your gas and insurance? Is the vehicle used for your own business or nonreimbursed work related use? I am just curious.


He has a farm.

[tiger_handheld]

I have no clue what've done wrong .... im gonna wait till i get some freee time and re-do my taxes ....

to the person who asked if i claimed my basic personal amt of 9600 or something like that .... isnt it done automatically if your doing it online / using a tax software?

also - can i keep carrying fwd my deductions till i make mad cash? or is there like an expiry date? ( deductions = rrsp / donations / tuition . etc ... )

[CSK'sMom]

SAHM. Single at Home Mom. ie. unmarried??
Does that mean you still have to file jointly with your exhusband becuase there are dependants involved?

I only had to file jointly for 3 years and because I was unfamilar with the process I used a tax program to guide me through it. Before that I was a single, poor student living off OSAP and paying rent. I got a refund.

I am currently trying to find out as much as I can about taxes and gathering as much knowlege in as many sources as possible.

No Piccolo, married for almost 20 years now. Stay At Home Mom. ;) I think you are confused a bit. There is no such thing in Canada as a "joint return". That is a US terminology. Here in Canada there are certain tax credits and deductions that are based on family income which means that each partner has to file an individual tax return. I have to file a tax return each and every year even though I have $0 income in order to get the CCTB (child tax benefit). If a person checks the married or common law box under marital status then generally both partners are required to file a tax return because of the family income credits and deductions.

[imnew]

I have no clue what've done wrong .... im gonna wait till i get some freee time and re-do my taxes ....

to the person who asked if i claimed my basic personal amt of 9600 or something like that .... isnt it done automatically if your doing it online / using a tax software?

also - can i keep carrying fwd my deductions till i make mad cash? or is there like an expiry date? ( deductions = rrsp / donations / tuition . etc ... )

You can carry rrsp and donations fwd..... So don't use your donation and rrsp deductions until u r done skool..

[Piccolo]

No Piccolo, married for almost 20 years now. Stay At Home Mom. ;) I think you are confused a bit. There is no such thing in Canada as a "joint return". That is a US terminology. Here in Canada there are certain tax credits and deductions that are based on family income which means that each partner has to file an individual tax return. I have to file a tax return each and every year even though I have $0 income in order to get the CCTB (child tax benefit). If a person checks the married or common law box under marital status then generally both partners are required to file a tax return because of the family income credits and deductions.
Ah STAY at home mom :o woops. Sorry.
Thanks for the clarification about "joint" all i remember from the processes while filing with my exhusband is the program I used had an option to file a "jointly". I guess they used that terminalogy in order simplify it. We both filled out the required information seperately, then the tax software calculated what it need to calculated and "suggested" who would be better off claiming the rent etc. since only one of us could. Before that, I always did my taxes by hand with a pencil for rough and a pen for the good copy :). I just filed my taxes this year using Studiotax based on some recommondations from a thread on RFD.

[Kommander_KornFlakes]

How are you claiming your gas and insurance? Is the vehicle used for your own business or nonreimbursed work related use? I am just curious.

I'm in the construction business, the only industry where workers can claim their fuel, insurance and ANY expense made on your (private) vehicle.

[tiger_handheld]

ok my #1 mistake i entered my 1 of my income amounts wrong instead of 98xx.xx i entered 98.xx .. hehe ..... so i fixed it and had a refund of 918.xx :) happy me .....

THEN - CRA screwed me ..


i entered my T2202A(07) -
full time months 8 , part time months 4 , tuition fees 2557.05 -

THEN my REFUND WENT FROM 918 TO 225 - WTF ? ? ? , I went back and del. the T2202A it stayed at 225.... whats wrong ? ... i thought tuition fees were tax deductable = make refund go higher ? correct me if im wrong !! ... im seriously thinking about making a new quicktax account and re-entering all my crap !

[tiger_handheld]

can i transfer my tuition credits to my parents ?

Can I NOT ENTER my T2202A ?

[Piccolo]

ok my #1 mistake i entered my 1 of my income amounts wrong instead of 98xx.xx i entered 98.xx .. hehe ..... so i fixed it and had a refund of 918.xx :) happy me .....

THEN - CRA screwed me ..


i entered my T2202A(07) -
full time months 8 , part time months 4 , tuition fees 2557.05 -

THEN my REFUND WENT FROM 918 TO 225 - WTF ? ? ? , I went back and del. the T2202A it stayed at 225.... whats wrong ? ... i thought tuition fees were tax deductable = make refund go higher ? correct me if im wrong !! ... im seriously thinking about making a new quicktax account and re-entering all my crap !
Wired ... ?? Im at a lost. I did a test and my refund decreased considerally when i took out the tuition.

[tiger_handheld]

WTF ????

i use quicktax ... piccolo what do u use ? .... i brought(import -in) in my 06 tax aswell .. do you that is the reason ?

ok i did it again as a regular ( without bringing in my 06 return) .. and i go from 918 to 225.74 !!

According to my Notice of assesment i have
" you have 3136 of fed unused tuition education amounts avail"
"we have adj your BC claim for tuition and edu amounts from 3707 to 5572. this incl. 1865 of unused tuition amounts from prior yrs"

^ is that the reason .. i have too much unused amounts and its using all/most of it now ?

[tiger_handheld]

ttt for help!

[twg]

No offense, but it sounds like you should pay someone to do your taxes... at least this year, while you understand what was done.

tuition credits should reduce the taxes paid, so if you paid taxes, then it should either increase your refund, OR keep it teh same if you were maxed out and carry forward the tuition credit.

And yes, you can transfer the tuition credit to your parents as long as you're using as much as you can, only the leftover can be transferred.

[Piccolo]

WTF ????

i use quicktax ... piccolo what do u use ? .... i brought(import -in) in my 06 tax aswell .. do you that is the reason ?

ok i did it again as a regular ( without bringing in my 06 return) .. and i go from 918 to 225.74 !!

According to my Notice of assesment i have
" you have 3136 of fed unused tuition education amounts avail"
"we have adj your BC claim for tuition and edu amounts from 3707 to 5572. this incl. 1865 of unused tuition amounts from prior yrs"

^ is that the reason .. i have too much unused amounts and its using all/most of it now ?
I use Studiotax. I got the Website from RFD. www.studiotax.ca. My taxes are not complicated and I understand the basics.
You fill in the information and the program calculates the refund or amount owing. But you need to know what to imput and when you are finished you can look through the forms to makes sure nothing has been forgotten. Schedule 11 is your tuition/education amount. I never have any carry over so i dont know how that affects things. As another person said, the tuition should decrease your tax liability (amount owing) not increase it. I dont know what you might have done.
http://www.cra-arc.gc.ca/tax/individuals/topics/income-tax/return/completing/deductions/lines300-350/323/menu-e.html
Did you enter the correct information from your T2202 form? If you feel comfortable, let someone get a fresh look at your taxes. Maybe they can find something or an error that you missed.

[tiger_handheld]

figured it out guys .... .

all good ...disappointed with the result .. but its reality!


Thread can be closed!

[questrader]

What's the typical rate to expect if you hire someone else to do your taxes?

[YLSF]

You should be happy if you have a low refund. If you get a big refund, most of the time it means you just overpaid throughout the year (as mentioned by a previous poster!)

[danielek]

You should be happy if you have a low refund. If you get a big refund, most of the time it means you just overpaid throughout the year (as mentioned by a previous poster!)

This is true, but it's also kinda like the distinction between getting paid vacation days versus getting paid vacation on every paycheque. It's more noticeable as a "lump sum" versus getting it over the year.

So in a way I'd rather get the money back in a refund to use at a later time.

[Piccolo]

This is true, but it's also kinda like the distinction between getting paid vacation days versus getting paid vacation on every paycheque. It's more noticeable as a "lump sum" versus getting it over the year.

So in a way I'd rather get the money back in a refund to use at a later time.

I agree. I like the "lump sum" tax refund, rather then a more tax being deducted from my paycheck.

It's so much more complicated then "you get a refund because you over paid". That is an extremely simplistic way of looking at it. It's much more involved then getting money back becuase you over paid. It COULD be as simply as that, but it usually isn't.

[don242]

This is true, but it's also kinda like the distinction between getting paid vacation days versus getting paid vacation on every paycheque. It's more noticeable as a "lump sum" versus getting it over the year.

So in a way I'd rather get the money back in a refund to use at a later time.

I agree. I like the "lump sum" tax refund, rather then a more tax being deducted from my paycheck.

It's so much more complicated then "you get a refund because you over paid". That is an extremely simplistic way of looking at it. It's much more involved then getting money back becuase you over paid. It COULD be as simply as that, but it usually isn't.

Or you could just make sure you are paying the right tax. Then automatically have some set amount deducted off your paycheque and put into a savings account and then every year take out that saved amount plus the interest you received (instead of the government) in a lump sum! Same thing, just you get the interest.

I know a lot of people's tax situation gets complicated so it is not always easy to pay the right amount of tax so many overpay. Unfortunatley I tend to overpay as well because my RRSP contributions are failry sporadic as I never know how much I will be contributing each year.

[ghostryder]

I agree. I like the "lump sum" tax refund, rather then a more tax being deducted from my paycheck.

So you would rather get a $1200 refund cheque in May instead of $100 extra per month in your pocket during the year. :confused:

It's so much more complicated then "you get a refund because you over paid". That is an extremely simplistic way of looking at it. It's much more involved then getting money back becuase you over paid. It COULD be as simply as that, but it usually isn't.

Actually it is that simple. You overpaid your taxes during the year. You get a refund of that overpayment. That's it.

[MegaSilver]

So you would rather get a $1200 refund cheque in May instead of $100 extra per month in your pocket during the year. :confused:

I prefer to get a large refund. It allows me to live on a smaller budget during the year, then get a "bonus" at the end of the year to pay against a large purchase, or against my mortgage. I know if I had an extra $100 a month, I would have a very hard time putting it against my mortgage and not blowing it on something frivolous. But I understand how others prefer the money now versus later. Hey, where I work we can contribute towards the company stock, and they will put up some of the amount for you. Free money! However, one person I work with would much prefer the money now, versus more money later, so he doesn't contribute. Too each his own.

[Piccolo]

So you would rather get a $1200 refund cheque in May instead of $100 extra per month in your pocket during the year. :confused:

Actually it is that simple. You overpaid your taxes during the year. You get a refund of that overpayment. That's it.

I guess i look at it differently then you. I dont see it as an over payment.

$X is taken from your paycheck as taxes because you owe $X. So you paid the correct amount. However, the government says you are allowed to reduce your amount owing to them (which has been paid) through deductions, non refundable tax credits, provincial tax credits etc. Afterwards you are given a refund, not because of an over payment(you paid the correct amount at the time it was taken), but because you are eligible to reduce your amount owing to the goverment.

I would agree that it is better to have the correct amount withdrawn each pay check, but there is no way of knowing this correct amount until your do you taxes (unless there are no tax deductions or credits to apply). Hence it's better for the government to take the amount that is calculated before applicable deductions and credits and then through my tax return I reduce that amount owing and as a result get a refund.

Perhaps you can consider it as simply as you get a refund becuase you over paid, however its a matter of persective.