With tax season in full swing, a volunteer from the Community Volunteer Income Tax (CVIT) Program is reminding Cochrane residents to file their taxes before the federal tax deadline of April 30.
Retired college professor Gerald Koenderink said that although he is not a professional account, he has always been keen and able to file taxes. As one of two volunteers who help file taxes year-round for the CVIT Program, he said his and his colleague’s workload increases considerably between March and April every year.
“All year round, the two of us have the occasional person coming in that needs taxes filed for sometimes several years back,” Koenderink said. “Sometimes people are weird about doing this, and then they are surprised when they owe money because they didn’t file on time, and there’s now penalties involved.”
For low-income individuals, Koenderink said it is important to file your taxes on time to ensure you receive the appropriate benefits and support from the government.
“A lot of the benefits would be cut off if you do not file, because they are income-dependent,” he explained. “So, if you don’t file, they don’t know what your income is, [and] they’re going to cut off all sorts of benefits [like] social assistance, GST credit, climate credit – any of these things that you are eligible for, regardless of income.”
Koenderink added the benefits of filing your taxes on time also extend to seniors who are dependent on Old Age Security (OAS).
“If the income is low as reported by filing, then there is something called ‘a supplement,’” Koendering said. “The supplement depends very much on what you report as your income when you file, and your supplement will be adjusted or disappear if you don’t file.”
He believes the worst possible decision an individual can make is to not pay their taxes because they assume they owe the government money. He calls this phenomenon the “ostrich approach” and insists it doesn’t work.
“They will catch you, and then in addition to what you owe when you should have filed, there are horrible penalties that get worse and worse if you miss filing year after year,” he warned.
Penalties for missing the 2022 deadline include a five per cent increase on your balance owing, with a monthly one per cent increase for each month that is missed up to a maximum of 12 months.
Late penalties for not filing in previous years will cost individuals 10 per cent of their balance owed with an additional two per cent increase for each month that their taxes remain unfiled, up to a maximum of 20 months.
Koenderink said most people are unaware of this consequence, and some still continue to take a risk by not filing their income taxes each year.
Rather than continuing to avoid or forget filing your 2022 taxes, he believes it is best to file and pay what is owed, rather than accumulating penalties alongside interest on what it owed.
In terms of filing your taxes, Koenderink said there are different software options, and filing independently is a strategy that many should try. Although it seems difficult or daunting, he said with easy-to-operate filing systems and a little help from someone a little more tech-savvy, the process becomes simple to understand over time.
“It sounds intimidating, but a lot of people, especially younger people, are so computer savvy it is not a problem,” he said. “You can buy a program to file your own tax, and the program I used to teach people to use at the library, UFile, is $25 to do your tax and the taxes of four other people.”
Similar to the CVIT Program, Koenderink added the Canada Revenue Agency has its own resources to help individuals file their taxes on time.
In terms of how Cochrane’s volunteer tax-filing program works, he said all he or his colleague really needs are just a few pieces of information, such as identification and a few other details.
“If you ask me to do your taxes and you fall within the guidelines for our program, then all I need from you is your social insurance number, birthdate, name, address known with Revenue Canada, and then you’ve given me permission to go to the Revenue Canada site and I get all the tax slips they collected for you,” he said. “It puts it automatically in my program, it saves me a lot of work, [and] then we go from there.”
For more information about the CVIT Program, visit Cochrane.ca/cvitprogram or call FCSS at 403-851-2250.
