Preparing Canadian Income Tax Returns

Comprehensive practical instruction on how to prepare the Canadian T1 return and all related forms and schedules.
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  • Lectures 199
  • Contents Video: 14.5 hours
    Other: 5 hours
  • Skill Level Beginner Level
  • Languages English
  • Includes Lifetime access
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About This Course

Published 12/2013 English

Course Description

** COMPLETELY UPDATED FOR THE 2015 T1 TAX YEAR - INCOME, TAX BRACKETS, TAX CREDITS, DEDUCTIONS **

The SBC Personal Income Tax Course provides you with practical instructions and real-world examples preparing Canadian T1 tax returns.

The course is divided into 8 modules covering all the fundamental areas of personal income tax. Each topic is taught via video tutorials providing examples of personal tax software so that you can watch a seasoned tax professional take you through each slip, form and schedule necessary to file income taxes quickly and accurately.

The course provides you with over 14 hours of instruction. Watch all the video tutorials for comprehensive knowledge or just the video tutorials that apply to your situation. Either way, the tutorials are always there for you to reference.

Become more tax savvy, save personal taxes, save on professional tax preparation fees and potentially start your own tax preparation business.

What are the requirements?

  • Canadian content for Canadian residents only

What am I going to get from this course?

  • By the end of the course you will be able to confidently and accurately prepare and file personal T1 tax returns
  • Have a good knowledge of how investment income is taxed and reported
  • Solid understanding and tools to prepare rental property statements
  • Understand tax credits, tax deductions and other concepts necessary to prepare returns
  • Form a good understanding of business income and expenses and how to properly claim and report them on the statement of business activities and tax return
  • Learn a number of tips and tricks on preparing returns, statements and staying off the radar maps with the Canada Revenue Agency
  • Understand how the Canadian tax system works, and how the Canada Revenue Agency administers the tax system and assesses returns

What is the target audience?

  • Canadian residents interested in learning more about personal income tax and preparing and filing their own returns
  • Tax students who are interested in leveraging their theoretical knowledge base with practical examples of form preparation
  • Individuals who are interested in starting their own tax preparation business and would like to expand their tax education and knowledge

What you get with this course?

Not for you? No problem.
30 day money back guarantee.

Forever yours.
Lifetime access.

Learn on the go.
Desktop, iOS and Android.

Get rewarded.
Certificate of completion.

Curriculum

Section 1: The Canadian Income Tax System
03:54

Welcome to the Canadian Income Tax Course! A brief introduction and some record-keeping before we get started.

Course Notes - PDF FIle
130 pages
*NEW* Tutorial Notes - PDF slides with notes
159 pages
02:31

In this tutorial we will go over the topic areas covered in section I of the course. We also explain why this course is a great resource for not only people wishing to prepare their own tax returns, but also students in tax and accounting.

03:24

An overview of the rules relating to who must file a tax return in Canada. After viewing this video, you will know if you have to file a tax return.

06:55

Even if you do not have a balance owing or refund, it may be a good idea to file a tax return anyway. Filing could result in future tax credits you wouldn't be entitled to if you didn't file.

05:37

An overview of how the Canadian tax system is administered by the government and the Canada Revenue Agency. Knowing how the system works is pertinent to the tax preparation process

04:40

Tax returns have deadlines that must be adhered to if you are to avoid being charged penalties and interest. In addition, I doubt anyone wants to put themselves on the CRA's radar map by not filing on time.

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04:48

If tax returns are filed late, penalties and interest will be assessed by the CRA, This tutorial will go over the calculations used to assess these penalties and the related interest

05:38

Some taxpayers are required to make instalment payments throughout the year. This tutorial examines who is required to make the instalments, when they need to be paid by, and the consequences of not making them.

09:04

Modern technology has changed the face of income tax return filing. This tutorial reviews the e-filing process and how it works. We also look at who is eligible to e-file

05:50

A common area of confusion in the tax realm is the difference between marginal tax rates and average tax rates. Here the marginal rate methodology is examined.

06:48

In this tutorial, an example is provided to show the difference between marginal tax rates and average tax rates. After viewing this tutorial, the difference will become clear.

04:47

Another area of confusion relates to the difference between tax credits and tax deductions. These are explained in this tutorial.

06:26

An example illustrating the difference between deductions is provided. Here we look at the difference between a $1,000 deduction and $1,000 tax credit.

04:57

Once returns are filed, the CRA issues a Notice of Assessment (NOA). This is a very important document for a number of reasons, which are outlined in this tutorial. The process behind them is examined.

03:31

An example of a Notice of Assessment is reviewed in detail, including the parts of the document and what they mean. After watching this tutorial you will be fully versed in NOA's and their format.

03:50

Similar to NOA's the CRA also issues Notice of Reassessments. In this tutorial we look at the difference between assessments and reassessments.

03:12

A sample of a Notice of Reassessment is provided along with the detailed explanation as to how they differ from a Notice of Assessment. Once completed, you will be able to distinguish between the two documents.

Section 2: Tax Forms & Information Slips
02:42

This video provides a brief overview of the topics covered in this section along with the importance of this subject area to the study of tax. Many courses do not look at forms and slips in details.

07:18

The most important form is the T1 itself. It is the summary of all the schedules, which includes all of your income, deductions, summary of tax credits, and the amount of taxes payable.

Attached for download to this lecture is the T1 General Form (sometimes referred to as the T1 General)

05:44

This schedule is used to claim and calculate applicable tax credits that apply to you. It is also the schedule that calculates your Federal taxes payable.

Attached is a PDF of the Schedule 1 for your reference.

02:46

Certain credits can be transferred to a spouse if they cannot be used. This form is used to transfer those credits.

Attached here for download is a PDF of Schedule 2 for your reference.

06:28

An important schedule that is used to report the sale of investments, properties, bonds, shares and other capital property. It is the schedule used to calculate the taxable portion of capital gains, or determine capital losses for the year.

Attached here for download is a PDF of Schedule 3 for your reference.

06:03

This schedule summarizes all of the interest, dividend and other investment income on a personal tax return. Also reported on this schedule are carrying charges and expenses related to earning investment income.

Attached here for download is a PDF of Schedule 4 for your reference.

02:21

If any credits are claimed that relate to dependants, this schedule will need to be filled in and filed. It summarizes personal and other necessary information for dependants.

Attached here for download is a PDF of Schedule 5 for your reference.

02:21

The working income tax benefit is a relatively new tax credit implemented by the government to give low income earners a tax break and an incentive to work. This schedule is used to determine eligibility and the amount of the benefit.

Attached here for download is a PDF of Schedule 6 for your reference.

03:42

An important schedule for anyone who makes RRSP contributions or withdraws money from their RRSP. Also included in this form is information regarding withdrawals and payments under the Home Buyers Plan (HBP) and the Lifelong Learning Plan (LLP).

Attached here for download is a PDF of Schedule 7 for your reference.

05:48

For self-employed individuals who are subject to Canada Pension Plan premiums. This schedule calculates the amount of CPP premiums that are payable in the year. This also forms part of the tax payable on the T1 return.

Attached here for download is a PDF of Schedule 8 for your reference.

03:56

Any donations and gifts made are recorded on this schedule. The schedule will then calculate the applicable tax credit that is then reported on the Schedule 1.

Attached here for download is a PDF of Schedule 9 for your reference.

03:51

The most important worksheet for students. This schedule reports the amount of tuition paid in the calendar year along with credits for the number of full and part time months in eligible schools. The tuition credit, education amount and textbook credits are calculated. Transfers are also reported on this form.

Attached here for download is a PDF of Schedule 11 for your reference.

03:22

Each Province will have its applicable forms and schedules which must also be filed with the T1 return. In most cases, the tax credits available are very similar to the Federal tax credits. Not all the forms are reviewed, but a general overview is given.

06:36

Understanding how the slip reporting system works is vital to the study of the Canadian tax system. This tutorial summarizes how slips are filed by institutions and what the CRA does with them once they are filed.

04:12

The most common tax slip. This slips is received by employees and contains all the pertinent information related to payroll for an individual

02:05

This is a bit of a catch-all slip. It can contain a number of sources of income and taxable benefits including research grants, medical premiums, retiring allowances, pensions and superannuations, etc.

02:13

If you received benefits under the Employment Insurance program, then you will received this slip which reports the benefits paid to you and income tax withheld, among other items.

03:25

This slip reports contract payments made to an individual. It typically is issued by contractors or companies who make payments to individuals who are not on a company's payroll

01:28

This slip reports any benefits paid from social assistance programs and the WSIB.

03:13

The two most common slips issued to seniors. The T4a(P) slip reports income received from the Canada Pension Plan (CPP). The T4A (OAS) reports Old Age Security payments and Guaranteed Income Supplements paid (GIS) to a retired individual.

03:28

Any payments and/or withdrawals from an RRSP are reported on this slip. Also reported are payments to an estate upon the death of an individual.

02:56

This slip reports retirement income payments out of a Registered Retirement Income Fund. Also reported are amounts deemed received by the estate or beneficiaries of someone who was deceased in the year.

04:55

Investment income paid out of a trust (such as mutual funds, estates, etc.) are reported on the T3 slip. Interest, dividends, foreign income and capital gains are the most common types of income reported on these slips.

03:43

The T5 slips reports income paid from corporations (commonly financial institutions) relating to investments. Interest and dividends are the most common types of income paid from these organizations and reported on the T5 slip.

04:43

A complicated "slip" which reports income paid from Partnerships including flow-through shares (a common type of investment in today's environment).

03:31

This slip is issued by institutions and corporations to report income from the sale of shares or other securities. Also included on some slips is gain or losses on sale of bonds. Typically the income is reported on Schedule 3 of the return, but may include other types of income as well.

05:51

The tuition slips reports the amount of tuition paid in the year by a student along with the number of months in full-time and part-time attendance. The numbers reported on this slip are directly reported on Schedule 11 of the T1 return.

03:21

A relatively new slip which reports payments from the UCB program (Universal Child Benefit) and the Working Income Tax Benefit program.

Section 3: Employment Income & Deductions
02:07

This brief tutorial discusses the topic areas we will be reviewing in this sections. It gives a brief overview of employment income and the issues related to reporting this type of income on tax returns.

Also attached to this introductory tutorial is the CRA's Employment Expense Guide that you can use for reference and research. The practical elements and application of these rules are covered in later tutorials.

05:04

This tutorial discusses what is covered by employment income. We go through some issues related to reporting employment income.

Available for download here is the CRA Guide T4130 - Taxable Benefits & Allowances.

This guide is used by employers to determine what benefits and allowances are taxable and not taxable. Studying this guide will provide you with a solid foundation of what needs to be reported on T4 slips and the personal tax return

07:19

A detailed example of how to report the information in a T4 slip onto the personal T1 tax return. We go through entering a sample T4 on tax software and analyzing which lines and schedules are involved on the T1 return.

07:21

Certain box numbers can cause some problems when entering T4's onto a tax return. In this tutorial we examine some of the common mistakes encountered when entering employment income from T4 slips.

05:42

Certain amounts received from employers are recorded not he T4A slip. This tutorial examines some of the amounts you will come across along with how to report them properly on the T1 return.

05:47

Jobs that involve tips and gratuities are a subject that raises lots of questions and confusion in the tax realm. In this tutorial we answer some of these questions are try to clear up some of the problem areas.

02:16

Now that everything is more clear with the issues related to tips and gratuities, this tutorial will show you exactly how to report them on the tax return.

02:33

This tutorial discusses some of the tax issues related to these types of programs and benefits, as well as how to report them.

04:16

Employees make contributions to the Canada Pension Plan and pay premiums for Employment Insurance. These can be claimed as tax credits. This tutorial shows you how to claim the credits.

03:06

It is not uncommon for people to pay too much for CPP and EI premiums. If you have over contributed to either programs, you can claim back the amount you over paid by filling out the T2204 which will be reviewed.

02:38

Employees are limited with what they can claim as expenses. This tutorial clarifies some of the misconceptions related to expenses and write-offs in this area.

You can download the CRA Employment Expense Guide - RC4044(E) for a breakdown of Employment expenses and the rules regarding who can claim expenses and what is deductible and non-deductible.

This guide will provide you with a solid foundation and understanding as per the CRA.

03:58

Now that we know what cannot be written-off, we'll look closely at who is entitled to claim employment expenses on their tax returns and the process they have to go through in order to do so.

07:11

In this tutorial we take a detailed look at this important tax form. We'll go through the sections of the form and the individual questions to ensure that employers fill out the form properly so that employment expenses can be claimed without issues with the CRA.

Attached for dowload to this lecture is the T2200 Declaration of Conditions of Employment form. This is the form that an employee must have signed and properly filled out by their employer in order to claim a deduction for eligible employment expenses.

Without this signed form, employment expenses cannot be deducted, no matter how related they are to earning employment income. In short, no form, no deduction.

03:56

Once a T2200 is obtained, an employee is eligible to claim employment expenses on the T777 form. Here we look at the form in some detail and provide tips on how to fill it out and file it properly.

Attached is a copy of the Form T777 Statement of Employment Expenses - This form reports and categorizes the deductible employment expenses on the tax return. This form must be filled out and filed with the tax returns of those individuals claiming employment expenses

05:31

One of the most common expenses when it comes to employment is vehicle expenses for those who have to drive to do their job. Here we look at what vehicle expenses are eligible and how to report them on the T777.

03:20

Some employees are required to work from home. This being the case they may be eligible to claim some expenses related to their home office. In this tutorial we look at the rules related to this area.

06:19

Now that we know the ins and outs of what can be deducted and the tax forms necessary, we'll look at an example of an actual T2200 and T777 and how they work together on the T1 return.

03:06

If employees are reimbursed for expenses, then this must be taken into account when determining how much to deduct on the tax return. Here we look at an example that included reimbursements.

01:42

Individuals who are paid commissions as part of their compensation have additional expenses they are allowed to deduct over regular employees. Here, we will look at these additional allowable expenses

02:59

A good resource for employment income and deductions is Guide T4044. This guide goes into quite a bit of detail in most of the topics we discussed in this section of the course.

07:16

An example of these forms for a commissioned employee is reviewed. You will be able to see the difference with previous examples of regular employees.

02:14

What do you need to file when you claim employment expenses? Do you have to send in all those receipts to the CRA? This tutorial answers this question and more.

*NEW* Eligible and ineligible retiring allowances
03:59
*NEW* How to report eligible retiring allowances and the RRSP transfer
03:50
Section 4: Investment Income & Deductions
01:52

The tutorial summarizes the investment income section of the course and what will be covered in the following tutorials.

02:22

The types of investments that generate interest income are examined along with how the interest is reported on T-slips.

06:18

This video goes over the process of reporting interest income that is reported on T3 and T5 slips on the personal T1 return.

03:30

One of the common problem areas in tax preparation is the issue of how to report investment income from joint accounts on individuals' returns. This tutorial introduces the topic and problem area.

03:30

This tutorial provides examples of how to report joint interest on the personal T1 return. It includes areas to be aware of when reporting this income.

03:34

As previously studied, the Schedule 4 provides a breakdown of investment income and deductions. In t his video, we look at how the income is reported and summarized.

05:37

Dividend income is analyzed along with the 2 different types of dividends that can be paid from Canadian corporations.

03:21

Ineligible dividends are examined along with an example of how to report the income from a T3 or T5 slip onto the T1 general return.

04:14

Similar in process to ineligible dividends covered in the previous tutorial, this video reviews eligible dividends and how they are reported from various slips.

02:32

A big area when it comes to investment income and reporting other types of gains is the realm of capital transactions that give rise to capital gains and losses.

04:03

We begin our study of capital gains and losses by reviewing the basic rules and how to calculate the amounts to report on the tax return.

Also provided here as supplementary material is the CRA Capital Gains guide for your further study.

03:46

In this tutorial we provide an example of both a transaction giving rise to a capital gain, and another that resulted in a capital loss.

03:39

Once the information necessary to calculate the capital gain or loss on a transaction is gathered and prepared, reporting the gain on the schedule 3 is required for the tax reporting.

04:16

Things start getting a little bit muddied as we look at the situation where a number of shares of the same stock are purchased at different prices. How do you calculate the gain/loss? This video explains.

03:53

Mutual funds provide an interesting issue when it comes to determining capital gains and losses on their sale. This tutorial reviews the issue.

04:30

In this tutorial we provide an example of the disposition of mutual fund units that have paid a distribution.

06:03

As can be seen from previous tutorials, mutual fund sales can create problems with determining their cost. This tutorial shows you a website where you can go for help if you can't figure out what was the cost is for a mutual fund.

02:35

Capital gains are taxable in the year, but capital losses cannot be applied against other sources of income. So what happens with those losses? This tutorial explains.

03:26

Here we provide an example of a capital loss carry back whereby capital losses incurred in the year, and capital gains tax was paid in the prior 3 years.

05:20

The logistics of how to claim a capital loss carry-back on your personal tax return is studied along with the necessary form (T1A) that needs to be filed.

Capital gains are taxable in the year, but capital losses cannot be applied against other sources of income. So what happens with those losses? This tutorial explains this farily common element of investment income and tax planning.

The form T1A Request for Loss Carryback is used to request the CRA to apply current year losses to prior years. Attached here is a copy of the current form.

03:30

An important area when it comes to investment income is the attribution rules. That is, who has to report the income when money is spread around to avoid paying tax?

05:12

With proper planning, the attribution rules can be avoided by putting into play some simple procedures. This tutorial examines ways to get around the attribution rules.

02:34

Any interest or other fees that were paid to directly earn income from investments can be deducted. This tutorial reviews these provisions.

03:40

In this tutorial we go over the process of claiming investment deductions and carrying charges on the Schedule 4 and the T1 return.

02:09

An example of Schedule 4 with deductions and how to report them is studied.

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Instructor Biography

Ian DiNovo, CPA, CGA, SBC Knowledge Systems Inc.

Ian DINovo is a professional accountant and Director of SBC Knowledge Systems Inc. He has been practicing accounting and offering independent financial and business advice for over 15 years.

He is the creator of a number of courses dealing with business, tax and investment matters that are designed to make difficult topics easy to understand for everyone.

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