Getting your Canadian Tax return e-filed is a relatively simple process, and you will be able to save yourself the hassle of filing paper tax returns. However, it is important that you understand the rules before you begin.
Line number must be on the left of the field
Getting a line number on the left when e-filing your Canadian tax return is very important. This allows the software to return you to the original form after entering your data. If you are unable to enter your data in this field, you will receive an EFILE error. Fortunately, there are some ways to fix this error.
You can get a line number on the left by opening your tax return and clicking the “Go” icon in the “Forms Navigation” menu. The ‘GO’ icon is also on the T1 jacket and on the T4 slips. The T4 slips must be filled out with box 14 empty and box 71 void.
The EFile program is provided by the federal government. This program is designed to help tax preparers transmit their returns electronically. When you are e-filing your Canadian tax return, you must enter your Efiler number and password. If you are unsure of your Efiler number or password, contact CRA for help.
Using a tax software program can help you avoid missing tax credits. Some software programs automatically calculate credits and other items. The program also helps you avoid errors. But, you should not count on the software to handle all aspects of your return. It may be more efficient to contact a tax professional.
A line number on the left is also important when you are e-filing your Canadian income tax return. If you are using a program that does not support e-filing, you may not be able to send your returns to CRA. This is because Vista machines do not have the capabilities needed for Efiling.
For example, T2125 slips have many expense fields with line numbers. If the amount in this field does not match the amount in the T4 slip, you will receive an EFILE error. If you do not have a line number on the left, the amount will not be transmitted.
The CRA has also issued an email to taxpayers who have had large amounts of education or textbooks. This is due to a software bug. It is recommended that taxpayers who are using a tax software program to use the most recent Efiler number and password provided by the CRA.
Late-filing penalty
CRA will charge a late-filing penalty if you file a tax return after the due date. A late-filing penalty is calculated on the amount owed, plus interest. It is calculated in one of three ways: 2% for each month you are late, 10% for the total balance owing, or 5% for the amount of money owed.
For people who don’t owe taxes, a late-filing penalty will not apply. However, you will need to pay interest on any balances owing until the debt is paid off. Similarly, delayed payments may affect Canada Child Benefit, Family Bonus, and GST/HST credit.
CRA may waive late-filing penalties in specific situations. You can apply for relief by completing Form RC4288 and submitting it along with a letter explaining why you are filing late. If you can’t pay the balance in full, you should contact the CRA for a payment arrangement.
CRA can also charge a late-filing penalty based on other criteria. It is possible to get a penalty if you omit or miss income, make a false statement, or show recklessness. There is also a penalty for gross negligence. If you file late for three years in a row, your late-filing penalty may double.
If you file a return after the due date, CRA may try to give you a verbal warning on the phone or write you a letter. In addition, CRA may begin legal action against you after 90 days. You can prevent this penalty by filing your return before the deadline.
If you are self-employed, you will also have to pay late-filing penalties. Self-employed individuals are required to file a self-employment tax return by April 30 each fiscal year. The balance of this return is due the following business day. If you are using the Lifelong Learning Program (LLP), you will also have to repay any funds you withdraw from your RRSP.
If you are filing late for the second time in a row, you will be penalized with a 10% late-filing penalty on the amount owing. This can be increased to 10% of the total balance owing when you are filing a tax return for the third time in a row.