As we all prepare for the bleak and most undesired time of 2014, they must be playing ”It’s the most wonderful time of the year” in the bowels of Parliament. All that extra income to just blow on hats, $30 glasses of orange juice or expensive trips to visit foreign dignitaries who have little interest in the going ons of Canada. It’s enough to make you sick, really. If they keep hiking the taxes on cigarettes and alcohol to discourage bad habits, how long will it take until they discourage people from staying gainfully employed? I digress!
I would love to whip up some amazing ideas for you all on how to save money at tax time but for someone who doesn’t have a business or kids, or who never went to school full time, there isn’t much a person like me can do to save on the amount I pay in taxes. Before you mention RRSPs and I throw up in my mouth a little, let me make something perfectly clear. I will not prolong the agony of giving the government more of my hard earned money just to receive a pitiful reduction in the amount I have to claim on my tax return.
It just doesn’t make sense to lock away $2000 just so I don’t have to pay $400 to the government. I can take that net $1600 and invest it in my TFSA to grow tax free for my retirement. RRSPs aren’t horrible, they just don’t work for me. I have a sneaky suspicion that the tax rates won’t be the same as they are now when I choose to retire. Have you ever seen tax rates go down before? I haven’t, especially now that the baby boomers are all on board ready to retire.
I do however, have one important tax tip for 2014: If you are a member of Parliament, claim everything! Even if you spend $600 on haircuts for your dog, claim it. The worst thing that could happen is you lose your job, get your name in all the news headlines, sue the government and still keep your sizable pension. You might even make back the lost revenue from your tell-all book deal, “I was just doing my job, see”.
The government is in business to get their money from you and that’s that. The only reason they ever came up with RRSPs was to keep the flow of taxes coming in when your older and an even bigger burden on the system. Half of the population still thinks their tax refund is free money from the government. Those are the same people who make me money with NSF charges and keep the economy afloat from the bottom so I can make money from the top.
Since I don’t have 8 kids from 8 different fathers or took 4 years of schooling to get a degree in European art history, I will probably end up paying money to the Government. No special loopholes or claims for this guy. I could hire an expensive accountant and they will tell me the same thing. I make money, I pay taxes, you’re welcome. As I re-read what I’ve been writing, it sounds a bit bitter so I came up with a solution. I love Kittens! There, much better.
See Something, Say Something!
Well then, the only thing I can suggest to you is common knowledge in order to make tax time less painful:
- Pay your taxes on time to avoid the penalty. That’s right, you have to pay more if you don’t pay on time. When you hold millions of people by their ankles each year, the “enforcers” need a break and don’t want to have to do it past April. Please be courteous to our money-extracting overlords!
- Use Decembers pay stub to figure out how much you owe in taxes. Since your dead beat employers never get your T4 in your hands before the RRSP deadline, you can use your last pay stub from December to see if buying an RRSP makes sense. It usually doesn’t but what do I know. You could end up owing a lot more than your dead beat employer took off and it will save you a heart attack when you do your taxes. Less healthcare expenses for the rest of us!
- Keep some cash around in case you do owe money. Stop being a mouth breather living paycheque to paycheque; you never know when unexpected expenses may pop up!
- If you buy tax software, share the costs with someone else. I split the cost with my Dad and we do our returns with the same license. Don’t have a Dad? I’m sorry for stirring those buried emotions.
- If you have lots to claim, hire an accountant. No one is more up to date on boring ol’ taxes then your friendly, neighborhood accountant. Certainly don’t get your tax info from some boob posting on the internet.
Well I hope you enjoyed reading my satire on tax season. For some reason, I feel MUCH better! Care to share any hot tax tips that only apply to half the population? Post them below! Until next time, may your dividends always increase.