MONTREAL – Filing out a paper tax form hasn’t been made obsolete by technology just yet, but the Canada Revenue Agency says it’s always looking for ways to increase electronic filing.
More than three-quarters of Canadians file their taxes electronically and the tax agency says its goal is to reach 80 per cent by 2015.
“Every year, the Canada Revenue Agency explores ways to reduce restrictions to electronic filing,” said agency spokeswoman Julie Pronovost.
Some restrictions exist on electronic filing due to security reasons, system limitations and authentication requirements, Pronovost said. As well, more complex cases can require paper tax returns.
For example, individuals who have declared bankruptcy are required to file tax paper returns, as are Canadians who are back filing their taxes or applying for amendments, such as the disability tax credit, the Canada Revenue Agency said.
A deceased person’s tax return also must be filed with a paper form.
In addition, non-residents of Canada must fill out paper forms to report income earned in this country.
Evelyn Jacks, author of more than 45 books on taxes and wealth management, said it’s a good idea to print out the Canada Revenue Agency’s T1 general 2013 income tax and benefit return to use as a guide, even if you’re filing electronically.
“Doing your income tax may have been simplified by the filing method, but the Income Tax Act and the law itself has not gotten a lot simpler,” said Jacks, president of the Winnipeg-based Knowledge Bureau, which focuses on financial literacy.
“You still have to know what you’re doing,” Jacks said.
Filing electronically has the benefit of getting a tax refund faster.
“Usually, if you’re electronically filing, you can receive your refund within eight working days, compared with four to six weeks if you’re using the paper method,” Pronovost said.
Canadians doing their own taxes have been able to file electronically through the Canada Revenue Agency’s Netfile portal since 2001, while tax preparers have been able to file Canadians’ returns electronically since 1993, she said.
Pronovost noted that in 2008 just 53 per cent of Canadians filed their taxes electronically.
“People are changing the way they do business and we’re just following the trend.”
Shelley Bevz, manager of taxes at AG Tax in Vancouver, said tax information can be stored electronically too, either on a disk, USB key or server.
“With the world going paperless, you’re not storing boxes and boxes of records anymore,” Bevz said.
Bevz said for those wanting to pay to have their taxes done, legitimate tax preparers have an e-file number from the tax agency. That means they’ve been screened annually and the software they’re using is secure to protect taxpayers’ information, she said.
The Canada Revenue Agency has a list of certified tax preparation software that consumers can go out and buy, but also lists free software programs available for Canadians to file their taxes by the April 30 deadline.