It's Tax Time -- Again!
By Ann Dennis, Communications and Public Relations Manager
Consolidated Credit Counseling Services of Canada, Inc.

Preparing your personal income tax return is an annual event most people would rather forget. It means rummaging through the house looking for T4's, receipts and other important documentation, countless hours working with tiny sheets of paper, scribbling numbers on notepads and tapping endlessly on digital calculators all before actually completing the return. Talk about stressful! Make your 2010 return as stress free as possible by gathering the paperwork well in advance, organizing it according to category (donations, medical expenses, T4's, etc) and preparing a rough draft to review before submitting the final version.

Remember filing a tax return insures your eligibility to receive the GST/HST tax credit, the Property and Sales Tax Credits, and other benefits/credits. Also, pay your taxes on time when you owe the government money and avoid any interest or penalties for filing your return late.

Remember consult a professional if you need assistance with your income tax return. The time spent together working through the document will be worthwhile when it's filed correctly and on time.

Childcare Expenses
You can claim a childcare expense for children less than 16 years of age if you or your spouse were working full-time or attending an educational program during the year.

Universal Child Care Benefit (UCCB)
Make sure you register each child under the age of six for the UCCB program. You will receive monthly payments of $100 for each child under the age of 6 (for an annual total of $1,200).

Working Income Tax Benefit (WITB)
The Working Income Tax Benefit (WITB) is a refundable tax credit intended to provide tax relief for eligible working low-income individuals and familiars who are working

Canada Learning Bond ("CLB") / Registered Education Savings Plan ("RESP")
If your family receives the National Child Benefit, you can receive extra money for your Registered Education Savings Plan ("RESP") through the CLB program.

Registered Disability Savings Plans ("RDSP")
RDSPs help eligible Canadians with disabilities and their families save for the future.

Receiving a refund?

Breathe easy now that your 2010 income tax return has been filed and you are receiving a refund. What will you do with this new found money? The options are endless depending upon how much money is coming your way. Most important, before you spend it take a good look at your financial situation, especially your 2011 budget to determine where best to use the cash.

If you are carrying a balance on a credit card consider applying your refund to the one with the highest interest rate. You will be further ahead at paying off your debt faster.

If you are in the enviable position of being able to invest your refund towards your future, take a look at opening one of these accounts with your financial institution:

Tax Free Savings Account (TSFA)
Consider putting away a few dollars every month into a Tax-Free Savings Account (TFSA). Canadians who are 18 years or older can contribute $5,000 per year in their TFSA and this money will grow on a tax-free basis.

Registered Retirement Savings Plan (RRSP)
If you've had a job in the past year, then you'll be able to contribute to a Registered Retirement Savings Plan ("RRSP"). Similar to a TFSA, money in your RRSP grows on a tax-free basis. However, the amounts you can contribute to your RRSP can be used as a deduction in your current year's tax return or carried forward and be applied to future years. Speak with a financial advisor to determine what's best for you.

Get a Head Start on 2011

Start organizing your tax files now and avoid the scramble next year. Be sure to keep all of your tax slips together in one location. Proper record-keeping will make it easy and quick to prepare your tax return in 2012.

Ann Dennis is the Communications and Public Relations Manager for Consolidated Credit Counseling Services of Canada (www.consolidatedcredit.ca). Consolidated Credit is a national non-profit credit counselling organization that teaches consumers about personal finance through web-based budget and debt analysis tools, financial literacy community outreach programs and in-person or telephone counselling.