Learning about taxes

Learning about Taxes 2012 Edition Our main character, Paul, is a 17-year-old high school student who spends most of his free time with his friends Omar and Anya Paul doesn't really know anything about income tax although he has heard his parents talk about it To earn some extra money, Paul has started a part-time job at a local store He works after school and on weekends Paul works 12 hours a week and is paid $10.00* an hour After two weeks of working, he is looking forward to getting his first cheque for $240.00 (12 hours × $10.00 × weeks) He has already decided how he is going to spend his money On payday, Paul stops by his work with Omar to pick up his cheque When he opens his pay envelope, he is disappointed to find that instead of getting $240.00 …he only received $206.59 "What's going on?" Paul asks, "Some of my pay is missing.” They have taken $33.41 in deductions." Paul shows his pay stub to Omar and there are deductions for employment insurance (EI) and income tax Paystub for Paul’s Job "What are these deductions for, like this EI?" asks Paul "I think they are taking money from your pay for some different taxes," offers Omar "Well, I don't know, but I am going to ask around I want to find out where my money is going," says Paul, who is now determined to learn about taxes "I would also like to know where this whole thing of making people pay taxes got started." "I don't understand this stuff," replied Paul, "What are income tax and employment insurance?" Line 435 - Paul adds the amounts on lines 420 to 428 and enters "0" This is his total payable Total credits Line 437 - Paul enters $211.28 income tax deducted, from box 22 of his T4 slip Line 482 - Paul adds the amounts on lines 437 to 479, and enters $211.28 These are his total credits Refund or balance owing Paul is now ready to find out if he has a refund or a balance owing He subtracts the amount on line 482 from the amount on line 435 Line 484 - Since the result is negative, Paul enters the difference here This amount is his refund Line 485 - If the result had been positive, Paul would have entered the amount here as a balance owing Direct deposit - Start or change area - Paul fills in his information so his refund can be deposited directly into his bank account Note If you calculate a balance owing when completing your return, the amount is due no later than April 30, 2013 You can make your payment in several ways Now that Paul has completed his tax return, he signs it and adds his telephone nu Filing Options Electronic filing If you file your return electronically you not need to send your tax information slips, receipts or other documents used to prepare your tax return You are still required to keep your receipts for six years in case we ask to see them Paper filing If you are filing a paper return you should attach the following: one copy of each of your information slips; your Schedule 1; your provincial or territorial Form 428 and any other supporting forms, schedules, or documents that apply to your return (the explanations in the guide will tell you when to attach additional documents) Avoiding penalties and interest Records Generally, you should keep your supporting documents for six years Have the receipts and documentation to support your claim ready in case you are selected for review Note If a tax professional will be preparing or sending your return to the CRA, show him or her all of your supporting documents, such as your information slips and receipts Conclusions, Where can you get help? [...]... property, and sales Taxes are used to support the government and the programs and services it provides Federal taxes are used for programs such as National Defence, Old Age Security, Canada child tax benefit, and transfers to provinces and territories Provincial and territorial taxes used for services such as bridges and highways, education, hospitals, and wildlife conservation Municipal taxes for services... general deductions 6) other measures, such as how tax is to be paid Video #1 – Introduction to Taxes In Canada, there are various taxes, tariffs, and duties The common Canadian taxes and salary deductions: income tax; employment insurance (EI) premiums; Canada Pension Plan (CPP) contributions; provincial sales taxes (PST); and goods and services tax/harmonized sales tax (GST/HST) Paul and Omar now go... qualify for a tax refund, credit or benefit Anya, Paul and Omar take the bus to Omar's house and on the way they begin to discuss taxes again "So, you said earlier you might get money back if you filed a tax return How does that work?" asked Omar "I'm learning about taxes as I go," said Paul, "but I'm fairly sure that if I paid too much tax I'll get a refund." ... says $59.99." The cashier checks the receipt and responds, "Yes, that is how it rang up $59.99 plus tax." "Oh, I forgot about tax," says Paul He pays the cashier and hurries out of the store with Omar, to go catch the bus home Video #2 - Do I have to file? What do I need to file my taxes? Even though Paul may not have to file a tax return, he may want to By filing a tax return, he could qualify for... buy video games On the bus, the subject of taxes comes up again "So, if some of my money is taken off my cheque for these deductions, how come they didn't take any money off our cheques when we did that landscaping job in the summer?" Paul asks Omar "My dad told me that I am supposed to file a tax return at the end of the year and I might have to pay some taxes on that money then," replied Omar "You're ... some different taxes, " offers Omar "Well, I don't know, but I am going to ask around I want to find out where my money is going," says Paul, who is now determined to learn about taxes "I would... such as how tax is to be paid Video #1 – Introduction to Taxes In Canada, there are various taxes, tariffs, and duties The common Canadian taxes and salary deductions: income tax; employment insurance... levied upon things such as income, property, and sales Taxes are used to support the government and the programs and services it provides Federal taxes are used for programs such as National Defence,