How to file your taxes as a student or Working Holiday participant in Canada – Updated for 2020
February 26, 2020
Posted in How To Guide
UPDATED March 26th, 2020: As a result of the COVID-19 pandemic, the Federal Government of Canada has extended the deadline to file your income tax and benefit return from April 30th to June 1st, 2020. For more information please refer to the website of the Government of Canada.
Tax season is back! Whether you are planning to come to Canada or you are already living here as a Working Holiday participant or international student, you need to know that if you are working in Canada you are also paying taxes to the Canadian Government.
Depending on how you completed your TD1 form, your employer will deduct taxes from your income on each payslip or if you have selected that you make less than your total claim amount on the TD1 form, you may not have to pay taxes until the end of the year. After the end of each year, you should file a tax return in order to check if the correct amount of taxes has been deducted over the course of the year.
The good news is that during your working holiday in Canada or as an international student, you can apply for a tax refund at the end of the tax year and you might be eligible for it! This is why it is important for you to understand how you are responsible for your taxes in Canada during your work experience.
Canadian taxes are complicated, and you probably have many questions about it. Don’t worry! We have compiled the most Frequently Asked Questions (FAQ) on filing taxes among our clients, and we have used the help from our partner Taxback.com to answer these questions, so let’s get started!
Do I need to file my taxes if I am an international student or a Working Holiday participant in Canada?
Yes. Once you have legally worked and have an income in Canada during your stay, you are legally obliged to file your taxes. During your work experience in Canada, as a student or Working Holiday participant, you will see how taxes have been deducted from your payslip, this is the reason why you need to file your own taxes after the end of the tax year (January-December each year), that way you are certain that you have paid the correct amount of taxes during your work experience in Canada.
What if I already left Canada? Do I still need to file my taxes?
Yes. You should! You are legally obliged to file your taxes once you have had an income in Canada, as a working holiday permit holder or as an international student. Even if you have left Canada, you have to file your taxes to make sure that you do not owe any money to the Canadian Government.
If you do not file your taxes, you may encounter problems if you want to come back to Canada later on. The Canadian Revenue Agency (CRA) can also fine you for not filing your taxes or filing your taxes past the deadline.
OK, now I get it! When can I file my taxes as an international student or Working Holidaymaker?
The Canadian tax year runs from January 1st to December 31st every year. The tax filing window in Canada is generally from the 26th of February to the 30th of April every year.
If you want to file your taxes from one particular year, you will file it during the following year. For example, if you were in Canada on a Working Holiday during 2019, you will file your 2019 taxes in 2020, between February, 26th and April, 30th.
What to know about taxes in Canada before starting your work experience.
Make sure you complete your TD1 form properly!
A TD1 is a form that is used to determine the amount of tax to be deducted from your employment income. There are two types of TD1 forms, provincial TD1 form, and federal TD1 form. As a worker in Canada, you must complete a TD1 form when starting new employment, no matter if you are a working holiday participant or a student. The TD1 form will be given to you by your employer at the beginning of any of your work experiences in Canada.
It is important to update your TD1 form correctly with each new employer to avoid the risk of not paying the right amount of taxes (you might end up owing money to the CRA). That is why it is important to use professional help, like the services provided by Taxback.com, so that they can review your completed TD1 form.
I want to file my taxes in Canada. What documents do I need?
You need your T4 and your SIN number to file your taxes!
T4 is an information slip prepared and issued by an employer to tell you and the Canadian Revenue Agency how much employment income you earned and how much taxes were deducted from your income. This T4 document will be given to you from your employer by, the latest, February 28th every year. You will receive a T4 form per each employer you have worked for in Canada during the past fiscal year. If you experience difficulties getting your T4 document from an employer – don’t panic. You can also file your taxes using your last cumulative payslip from your employer instead of using your T4.
If you leave Canada through the fiscal year, you will still receive your T4 for those months you worked in Canada, but you have to wait until the next upcoming February to receive your T4.
My employer has not sent me the T4 form. What can I do?
Employers are obligated to send you the T4 form. You will receive your T4 either by post or by email from your employer. If you have not received your T4 by the end of February, you should contact your employer to get your document.
It doesn’t matter that you do not work at the company anymore or that you are back in your home country after your working holiday experience in Canada or your study program, you should still get your T4 from your employer in Canada.
Can I file the taxes myself or do I need assistance for it?
You can file your taxes by yourself, but we do not recommend you to do it alone, especially if you are not familiar with the process and you are new to Canada. Remember! The Government can fine you if you file your taxes wrong. So, we suggest you always use professional help to claim your taxes to make sure it is filed properly. That is why we have partnered up with Taxback.com to help you file your taxes.
How much do I need to pay if I want to file my taxes with Taxback.com?
When you apply with Taxback.com you will not have to pay any upfront fees if you are expecting a tax refund. Instead, they will deduct fees from the refund amount once it has been secured from the CRA.
For Canadian tax refunds, they charge 12.5% (plus handling fee) if your refund is over $500 CAD. If your refund is under $500 CAD there is a flat fee of $62.50 (plus handling fee).
Tell Taxback.com that you are a Stepwest client and get a $10 discount for their service! Get started now!
How much money will I get back?
It is hard to find the exact amount you will get since it depends on a number of factors such as:
- Your study or work permit in Canada
- Your earnings and tax deductions
- How long you have worked in Canada for
- How many employers you had during the year
Remember that even though you are on a working holiday permit in Canada or a student, you will not be refunded all the taxes you paid to the Government of Canada back. A certain amount of taxes will still be deducted from your income. Each person will have different situations while claiming their taxes depending on their circumstances, that’s why we highly recommend you to connect with Taxback.com so you can get a tax refund estimation for free! To get started, you can calculate your possible refund here:
How can I file my taxes if I already left Canada?
It can get a bit complicated for Working Holiday participants or students who want to file their taxes when they are not in Canada anymore. That is why we recommend using the service of Taxback.com. Currently, Taxback.com is the only agent that will allow you to file your Canadian taxes from outside of Canada. So working with Taxback.com will allow you to file your taxes hassle-free without being physically present in Canada.
What if I file my taxes late for the year?
Technically, you can file your taxes at any time during the year, if you DO NOT have amounts owing to the Government.
The tax filing window in Canada (1st of January to the 30th of April) is the time where people who have amounts owing to the Canadian Government file their taxes. After the 30th of April, if you file your taxes and you have amounts owing to the Government, you will be charged with a fine for late filing.
But, if you do not have amounts owing to the Government, you can file your taxes at any time and there will be no late fine. However, we do not know whether you will have amounts owing to the Government or not and therefore, we recommend you file your taxes every year and on time.
If I miss the deadline to file my taxes, can I still get my tax return for that year?
Yes! You have up to five years to file your taxes from Canada. Again, we recommend you to file your taxes yearly since if you have amounts due to the Government, and you file your taxes late, you will be fined by the CRA.
Get started and get a $10 discount on the link below!
We know that filing a tax return can be very daunting and frustrating, but having the correct information and the knowledge on how to file your Canadian tax return is essential! By having the right resources to refer to, you can spend less time worrying about the details and spend more time enjoying your work, travel, or studies in Canada. So if you want to start getting ready for the 2020 tax season and file your taxes correctly, start now by contacting Taxback.com and don’t forget to mention that you are a Stepwest participant to get your CAD10 discount!
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