Here are Canadian tax tips for new residents and immigrants filing their first income tax return:
1. Know Your Residency Status for Tax Purposes
Even if you just arrived, you may be considered a resident for tax purposes if you have established significant ties (e.g., home, spouse, children in Canada).
This determines what income you must report.
2. Report Your Worldwide Income from the Date You Became a Resident
You only need to report income earned after your arrival in Canada.
Clearly indicate your entry date on your return.
3. Gather International and Canadian Tax Documents
You may need:
- T4 (employment)
- T5 (investments)
- Proof of foreign income earned before arrival (for reference, not taxed)
- Records of foreign property over $100,000 (for Form T1135)
4. Apply for a Social Insurance Number (SIN)
A SIN is required to file taxes and receive benefits. Apply through Service Canada as soon as you arrive.
5. Open a CRA My Account
Register for CRA My Account to:
- Check benefits
- Access notices and past returns
- Set up direct deposit
6. Apply for Benefits and Credits
You may be eligible for:
- GST/HST credit
- Canada Child Benefit (CCB)
- Climate Action Incentive
Use Form RC66 and RC66SCH to apply for CCB as a newcomer.
7. Claim Deductions and Credits
Consider:
- Tuition credits (T2202)
- Medical expenses
- Moving expenses (if relocating for work or school)
- RRSP contributions (if applicable)
8. Set Up Direct Deposit
Get your refunds or benefits faster by setting up direct deposit through CRA My Account or with your bank.
9. Keep All Documentation
Maintain records of your entry date, tax slips, rent payments, and international income for at least 6 years.
10. Get Help If You Need It
You can access:
- Free tax clinics under the Community Volunteer Income Tax Program (CVITP)
- Tax software for new filers
- Professional help from an accountant familiar with newcomer filings
Final Thoughts
As you start your new life in Canada, it can be confusing when filing your first tax return. By being prepared, you can reduce your tax bill, save money, and avoid penalties.
Doing your own taxes may save a bit of money, however if you miss a deduction or credit you are eligible for, it could end up costing you more in the end. If your taxes are complex, you should be contacting our office to ensure accuracy in your returns.