How Filing Income Taxes Can Make You Richer

For some filing their income taxes is a big hassle, a waste of time maybe, or a constant reminder of how much of their income they have to hand over to Revenue Canada. Some look forward to it each year, knowing there will be a (sometimes fat) refund coming back to them. Some are eager because they've taken measures to plan legitimately to lower the amount of taxes they pay, such as via maximizing their allowable RRSP contributions.

Then there are the rest of us. We don't really care either way, we don't think anything will come back to us in the form of a refund and we let it sit. We miss the filing deadline and maybe even the next year's - and then a couple go by and we realize we've not touched a T4 for longer than 30 seconds in the past few years. Or Revenue Canada has sent us a friendly reminder (or six).

What is the point of pondering why people don't file their taxes? Because here's some reason you should:

1. Obviously, you might get a refund. I don't think expansion is needed, there.
2. A lot of provincial and federal funding programs require proof of your income, in the amount of Revenue Canada's Assessment of your income tax return. An example of one of these programs is provincial rent assistance - they want to know that you're used to living in a lower tax bracket and that you're not just, say, laundering your income so it doesn't show up in your own bank statements. You can obviously only get this assessment when they have something to file, so get cracking.
3. Did you know that if you make what is considered by Revenue Canada as a low-moderate family income, you're probably eligible for a rebate of GST, paid quarterly? You would also receive an amount of this rebate for each of your children. You would know this if you'd filed your taxes, because on the very first page of the T1-General form is a box you'll want to check, to apply for the GST Rebate.
4. Canada Revenue also reports to a number of federally, provincially and privately run programs, such as the medical services plan that your province administers. Based on last ear's income, you may qualify for premium assistance, lowering your monthly medical plan's bill or even making it "free."
5. Another type of government funding that your family's income affects is the Child Tax Benefit. This is calculated based on your total household income and the number and age of your dependants. Don't receive this benefit yet? File your taxes and while you're waiting for the assessment to arrive, fill out the Application for Child Tax Benefits form that you can get from Revenue Canada's website or offices.
6. Every year when you file your taxes, a percentage of the income you claim is calculated. This 18% of your income, to the Government's specified maximum, is now your RRSP Contribution Limit. If you've not maximized your RRSP contributions in the past few years, you may have an amount carrying forward as well.

These are just six reasons that you might want to be more proactive about filing your taxes. Can you think of more?