Filing Income Taxes
DIY or Hire a Pro?
by Kevin Sun
Do you look forward to filing your income taxes? Me neither. After all, we’ve got to gather our slips, check (or rather, find) our receipts, and then figure out just how we’ll get this done by the April 30 deadline while juggling all our other responsibilities. Though around 60% of Canadians usually do get refunds, considerations such as CERB taxes also mean that many could owe money, which can add more stress to an already stressful task.
The stress, effort, and time it takes to file taxes by yourself are all reasons why many people say no thank you to DIY and hire a professional to do their taxes instead. However, is it really worth it to pay someone else to do a job you could possibly do yourself? Here are some things to consider:
Filing Taxes Yourself
Is Do-It-Yourself a Money Saver or Time Waster?
Filing taxes yourself saves you money on hiring a pro, a cost which can go into the hundreds. However, time is also money and you could spend a lot of it dealing with all the numbers, forms, and procedures of a tax return. The more complicated your situation is, the more risk you’ll also have of making a mistake. This could cost far more than an accountant would, either in money you left on the table or money you owe that will get hit with fees and interest after April 30 – even if you didn’t know about it.
Thankfully, most Canadians can get by just fine through the DIY route. If you’re used to filing by paper, then trying out CRA certified software will show you how to do your own taxes. Doing your taxes online will help you avoid mistakes like input errors, get any refund you’re owed sooner, and you’ll have a much easier time overall compared to filing with paper. However, if the Canada Revenue Agency (CRA) mailed you an invitation to file your return by phone (they do this for Canadians with low or fixed income and stable tax situations), then that may be your best option. Depending on your situation, you may also be able to take advantage of a free tax clinic where volunteers help file your taxes at no cost.
Hiring a Pro to File Your Taxes
Is It Worth It?
If you already have a good relationship with a tax preparer and know that their work is solid and their price fits your budget, you’ll probably be happy to just keep using them. For everyone else, getting a professional to file their taxes is easier said than done. As with any service, you need to find the right person for the job. Remember that if they make a mistake, you’re the one who will pay for it. That’s why after hiring a new tax professional, you should check their work at least once to make sure they’ve got all the details right. This could take as much time and effort as just doing it yourself.
Yet the biggest benefit of hiring a pro – getting help to make sure your tax return is done correctly – can’t be underestimated. For example, if you own a business, work as a freelancer, have a profitable side hustle, or even just bought or sold a home, there could be deductions you don’t know about or expenses you never thought to claim. An accountant, bookkeeper, or other income tax professional can ensure you’ve claimed, deducted, and filed everything you need to. Besides that, the peace of mind from knowing you’ve got backup in case of an audit could itself be worth the price (which is also deductible on your return).
Prepare to File Your Taxes in March
Whether you decide to go DIY or not for filing your taxes, start sooner rather than later. By the first week in March you should have all necessary tax forms from your employer, including your T4, T4A, T5, RRSP contribution slips, donation receipts, and a T2200 if you’re itemizing work from home expenses. Set aside some time this week to gather everything you need to start your return, even if you’re not doing it yet. Organizing early will make everything less stressful later and help you catch any problems before it’s too late. If you want to hire a tax preparer, then start looking for one right now.
How Filing Your Taxes on Time Helps You
If you have any worries at all about filing your taxes by yourself, then getting a professional’s help is the safest route. However, make sure to ask them a lot of questions about what they’re doing and review their work with the goal of not only checking for errors, but learning as much as you can. You may discover that after this year, you could start doing it yourself. Also keep in mind that you can contact the CRA directly with any questions you think they can answer.
Last Updated on October 15, 2024
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