Did You Pay Too Much Income Tax?
Posted May 11, 2010 11:16 am.
This article is more than 5 years old.
It is common to see tax-tip articles leading up to the filing deadline. But the period after the deadline can be important too.
1. Only 26 per cent of income-tax filers report their tax liability correctly, according to IRS statistics cited in a NBER Working Paper report. Of the taxpayers who got their liabilities wrong, most underestimated them. But a good percentage overestimated and paid too much tax.
So, you might want to check your return for errors, especially if you were one of the “last-minute” filers and rushed through your tax return. If you discover you overpaid, send in a request to Canada Revenue Agency for an adjustment.
Don’t put it off to long, though. While most requests for adjustment can be filed up to 10 years back, some requests have shorter filing periods. For example, capital cost allowances (CCA) can only be readjusted within 90 days after receiving a Notice of Assessment or Reassessment.
2. If you filed your taxes in a last-minute scramble, take steps this year to avoid a repeat experience when the deadline rolls around again. Set up a simple scheme for staying organized. Avoid the shoebox and create a filing system for storing receipts by category.
3. Want to check on the status of your tax refund?
For more on this topic, visit Canadian Business Online.
