1. You owe tax or want to receive a refund
If you are a resident of Canada for part or all of a taxTax A fee the government charges on income, property, and sales. The money goes to finance government programs and other costs.+ read full definition year, you must file a tax return if you owe tax or want to receive a refund.
2. Recover any tax you overpaid from your pay cheque
You may have had too much tax deducted from your pay cheque and not benefited from all the deductions and tax credits you were entitled to.
3. Take advantage of refundable tax credits
Examples of refundable tax credits: GST/HST Credit, the Working Income TaxIncome tax A charge you pay based on your total income from all sources. The Canadian government and your province set the rate.+ read full definition BenefitBenefit Money, goods, or services that you get from your workplace or from a government program such as the Canada Pension Plan.+ read full definition. You won’t receive these credits if you don’t file a return.
4. Create contribution room in an RRSP
If you have earned income, you can make RRSPRRSP See Registered Retirement Savings Plan.+ read full definition contributions, which reduce your net income. If you don’t use your contribution room in any year, you can carry the unused amounts to future years. Learn more about RRSPs.
5. Carry forward or transfer any unused tuition, education or textbook amounts
If you don’t have enough income to use these tax credits, you can carry them forward to future years. Or you can transfer them to a family member.
When you don’t have to file a return
You don’t have to file a tax return if:
- your tax is withheld at source – taken off your pay cheque – and you have no other sources of income or deductions; or
- you have no income to report.
However, you may still choose to file a return in order to take advantage of certain refundable tax credits and benefits, and to build RRSP contribution roomContribution room The amount you can put into a savings plan like a Registered Retirement Savings Plan (RRSP). If you do not put the full amount into the plan each year, you will have extra, unused contribution room that you can use in later years. Example: Lets say you can contribute $12,000 to your RRSP this year,…+ read full definition. Learn more from the CRA about when you must – and when you may want to – file a return.
Learn more from the Canada Revenue Agency (CRA) about when you must – and when you may want to – file a return.