Everybody dreads tax time, even people who seem to have their act together. Although the Canadian tax system is not as complicated as the one that plagues our neighbours down south, it is still difficult to navigate if you don’t have the right know-how or the patience to fill out different forms.
To save yourself time and the stress of doing your own taxes, a personal tax accountant is an important investment in your financial health. Besides freeing up your time, an accountant can free up your mind because you know that what you submit to the government is correct to the best of your knowledge, and you don’t need to worry about failing an audit. Here are some services that an accountant can provide.
1. Income Tax Filing
One of the most important services that a personal tax accountant can provide is also the most basic, and that is income tax filing. Many people nowadays rely on income tax filing software because they believe that it is more affordable and easier than hiring an accountant.
However, these software programs don’t work as hard to find potential deductions as an accountant will. The margin of error is also much higher as you could still enter your information improperly, especially for tax filers who don’t have the technical know-how to navigate software. Sometimes, the traditional way is best, and an accountant can file taxes on your behalf more accurately than software.
2. Navigating Small Business or Freelance Income
Most larger businesses don’t rely on a personal accountant but have their own team of accountants to file corporate taxes. However, if you are a small business owner or a freelancer, you can get help navigating your business income from the same accountant who manages your personal taxes.
As a business owner or freelancer, you are on the hook for taxes that a regular employee doesn’t have to pay, and you could get in legal trouble if you do not meet this tax requirement. However, you can also deduct many of your expenses and get tax relief. An accountant can help you navigate this complicated system.
3. Tax Planning
If every time you file income taxes you are met with an unpleasant surprise in terms of a higher amount owed or lower deductions, then it’s time to invest in an accountant who can help you plan your taxes. Tax planning is vital because it can help you plan your finances and budget for the rest of the year. You can save money to pay your income taxes or budget for leeway in the form of deductions.
4. Addressing CRA Problems
Accountants are helpful when managing regular taxation, but they are absolutely vital when you run into problems with the CRA. Whether you are getting audited, have a lien placed on your income, or need to pay back taxes or penalties, an accountant can help relieve that burden.
Accountants can help you put together documentation to navigate the audit process, proving to the CRA that you paid the taxes you owed them. If you owe the CRA money, accountants can minimize the disruption this will place on your daily life and help you put together a payment plan that will work.
5. Providing Peace of Mind
The last service accountants provide is not in the job description, but it is vital. Professional accountants help you breathe easier because you won’t have to worry about getting audited or encountering other tax problems.
If you need help with your personal taxes, consider if an accountant is right for you.