Unfortunately, any tax planning for your 2022 personal tax
return needed to be done by December 31st of 2022 and there
is very little, if any, planning you can do in March and April of this year.
However, there is still hope to reduce your 2022 income tax
liability, especially if you are not a detailed organizer of information.
Today, I will review a few deductions and tax credits people
sometimes leave on the table. None of this is cutting edge information; it is
just double checking you have claimed all your deductions and credits. In fact,
if you read my last blog post On How to Get on Your Accountants Good Side During Tax Season
, you may have already assembled
much of that information for your accountant and your double checking and
digging for receipts will be limited.
and Tax Credits to Double-Check Completeness
Many people borrow to finance their stock market investments,
real estate and rental property investments or capital contributions to their
professional firms or other possible investments. In many cases, a summary letter of
the interest expense paid on your bank loan or line of credit is not
provided by the lender and can be easily overlooked.
If you have not received a summary document, see if you
can obtain a summary letter from your financial institution. Failing that, ensure you have summarized
each interest charge for January to December 2022.
If you engage an accountant or use tax software to prepare
your return, the software will typically keep track of any capital loss
carryforwards you have to apply against any capital gains you incur in the
year. However, the carryforward information is predicated on accurate historical information being input in the first place.
I have occasionally seen capital losses missed due to
improper carryforward information, especially where T1 Adjustments have been filed in prior years in respect of capital gains and losses. To ensure your information is accurate (your
accountant will likely do this if they have access to your CRA information)
check your 2021 income tax assessment in the explanation section. This section
reflects any capital losses carried forward. Alternatively, if you have
registered for My Account with the CRA, check the balance online.
Donation Tax Credits
It is very easy to miss a donation receipt. It can be lost
in the mail, caught in your email spam or be misplaced. I suggest you
quickly scan your monthly bank statement and/or credit card statement to ensure
you are not missing any charitable receipt.
Going forward (if you are not doing this already), best
practice would suggest you enter each donation you make during the year on an Excel
or other spreadsheet and have an additional column that tracks whether your
have received the tax receipt for each donation you made. This allows you to
follow-up any missing donation tax receipts.
Medical Tax Credits
Medical receipts are similar to donation receipts. You
should again review your bank statement and credit card statement to ensure you
are not missing any medical receipts. For health and medical practitioners you use on a consistent
basis such as orthodontists, chiropractors, physiotherapists, dentists etc.
ask them to print out a summary of paid expenses for 2022 (or for the twelve month period ending in 2022 if you are using that alternative).
If you have a health insurance plan, you should go online
and print out all the insurance statements relating to any reimbursements made by the insurance company in 2022. Under most health and dental plans, you will have incurred some
portion of the medical or dental cost and that uncovered portion is deductible
as a medical credit.
Going forward (if you are not doing this already), best
practice would suggest you enter each medical expense you incur during the year
on an Excel or other spreadsheet and have an additional column that tracks
whether your have received a receipt marked paid for that expense (ensure your receipts reflect your payment made, this will keep the CRA happy). If you have
a Health Insurance Plan, I would have an additional column that reflects
insurance reimbursements for your medical expense. This ensures you claim all non-reimbursed medical expenses.
If you are eligible for pension splitting
, this could result in significant tax savings. Most tax programs have a function to maximize the pension splitting, but I would ensure the function has been applied and any eligible pension income has been split to your benefit.
Employment and Business Expenses
Employees may receive a T2200s or T2200 from their employers
that allow them to deduct home office expenses and other employment expenses.
If you are entitled to claim employment expenses, ensure you have received
these forms from your employer or request the form, if you are entitled to
claim employment deductions.
Once you have the form, go through your expenses for the
year to ensure you have captured all your home office, car or other employment
expenses you are entitled to claim. It is best practice to record these
expenses throughout the year (monthly or quarterly) so you do not miss any
expenses or create a 5 hour receipt sorting project at tax time.
If you are self-employed, you will not need a T2200.
However, the same advice holds as for business expenses as for employee
expenses. Ensure you have captured all your expenses for the year through
If you are an Ontario resident, don’t forget to assemble your Staycation receipts. Ontario residents can claim 20% of their eligible 2022 accommodation expenses. For example, for a 2022 stay at a hotel, cottage or campground you can claim eligible expenses of up to $1,000 as an individual or $2,000 if you have a spouse, common-law partner or eligible children, to get back up to $200 as an individual or $400 as a family. For Staycation information, see this link
The above discussion is not tax planning. It is record
keeping diligence. As noted above, I suggest you get in the habit of tracking
these items throughout the year to avoid missing any deduction or credit at
This site provides general information on various tax issues and other matters. The information is not intended to constitute professional advice and may not be appropriate for a specific individual or fact situation.
It is written by the author solely in their personal capacity and cannot be
attributed to the accounting firm with which they are affiliated. It is not intended to constitute professional
advice, and neither the author nor the firm with which the author is associated
shall accept any liability in respect of any reliance on the information
contained herein. Readers should always consult with their professional advisors in respect of their particular
situation. Please note the blog post is time sensitive and subject to
changes in legislation or law.