'A tax year like we’ve never seen before': Survey shows Canadians are preparing for complicated tax year
WINNIPEG -- As the deadline to file 2020 tax returns comes closer, a new survey from IG Wealth Management says the COVID-19 pandemic is making tax filing complicated for Canadians.
The survey, conducted by Pollara Strategic Insights and released Thursday, said 64 per cent of Canadians surveyed are dealing with tax-filing considerations for 2020. Of that number, 46 per cent will have claims related to working from home, and 45 per cent will have to consider the implications of government benefit programs, such as CERB.
“The year 2020 is a tax year like we’ve never seen before,” said Aurèle Courcelles, assistant vice president of estate and tax planning with IG Wealth Management in Winnipeg. “It’s the first year people are getting a lot of government benefits that they would never have seen.”
Courcelles notes the government benefits to help Canadians during the pandemic, such as CERB or the student benefit, are taxable, and you have to report it on your tax return.
He added claiming home office expenses, previously a complicated process that required employees to get forms filled out by their employers, keep all receipts, and even calculate the square footage of their office space, has been simplified this year.
“As long as you worked a minimum of four consecutive weeks at home, and during that time, you’re working 50 per cent for your employer, then you can actually claim a deduction based on $2 per day, up to a maximum of 200 days or $400,” Courcelles said.
The survey also found 35 per cent of Canadians will rely on a professional for their tax returns. For the 65 per cent filing their taxes themselves, 44 per cent will use tax software, while 13 per cent will have a friend or family member assist them.
Courcelles said working with a professional will help ensure Canadians can make sure they’re paying their taxes correctly, and finding deductibles. He added tax-planning needs to be a year-round activity.
“Everybody should be looking at their tax return and (thinking about) how they can minimize the taxes they pay,” Courcelles said. “It’s too late to do anything about last year, but this is probably the time where people think about their taxes the most.”
The tax deadline for most Canadians is April 30.
The survey was conducted with an online sample of 1,504 adult Canadians between March 26 and 29, 2021.
Pollara Strategic Insights said results from a random sample of this size can be considered accurate to within ±2.5 per cent, 19 times out of 20. They added the results are weighted by gender, age and region using the latest census data to be representative of the Canadian population.