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Sheila





Joined: 09 Feb 2008
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votes: 16
Location: Central Alberta

PostPosted: Sat Feb 09, 2008 1:46 pm    Post subject: Income Tax Reply with quote

As a tax preparer, I am impressed with the non refundable tax credits this year. $1000 for just being employed, $2000 per child, up to $500 in physical activities for kids. The basic excemption went up to $9600 with a full transfer of $9600, if your spouse does not work. This is not only great for low incomes, but actually gives a break to the middle class, for a change. (non refundable tax credits, you don't pay tax on these amounts)
Craig
Site Admin




Joined: 29 Aug 2006
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PostPosted: Sat Feb 09, 2008 1:56 pm    Post subject: Reply with quote

My wife does the taxes but I'm looking forward to the bigger refund. I think many many Canadians, like yourself, will be impressed. Bring on an election!!!
peter_puck





Joined: 15 Dec 2007
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votes: 1

PostPosted: Sat Feb 09, 2008 2:32 pm    Post subject: TAX CUTS Reply with quote

Quote:

As a tax preparer, I am impressed with the non refundable tax credits this year. $1000 for just being employed, $2000 per child, up to $500 in physical activities for kids. The basic excemption went up to $9600 with a full transfer of $9600, if your spouse does not work. This is not only great for low incomes, but actually gives a break to the middle class, for a change. (non refundable tax credits, you don't pay tax on these amounts)


Unless we have an election shortly, I don't think the tax cuts were good idea. The money would have been better spent lowering the debt or lowering the capital gains rate (or any number of other taxes).
It has also tied the hands of the government in the future. We are likely headed for a downturn, which means there will be no more election goodies available. In addition, there might have to be some spending cuts to keep us out of the red - which would be the logical time for the Liberals to defeat the government.


I woud have liked a huge payment on the debt now, which would have given the government wiggle room for tax cuts when an election came up.
mltoryblue





Joined: 29 Oct 2007
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PostPosted: Sat Feb 09, 2008 6:19 pm    Post subject: Re: TAX CUTS Reply with quote

peter_puck wrote:

Unless we have an election shortly, I don't think the tax cuts were good idea. The money would have been better spent lowering the debt or lowering the capital gains rate (or any number of other taxes).
It has also tied the hands of the government in the future. We are likely headed for a downturn, which means there will be no more election goodies available. In addition, there might have to be some spending cuts to keep us out of the red - which would be the logical time for the Liberals to defeat the government.


I woud have liked a huge payment on the debt now, which would have given the government wiggle room for tax cuts when an election came up.


When you have over 450 billion in debt, an extra 10 billion paid against it makes very little difference. The government is much better off lowering taxes and growing the economy to reduce the debt to GDP ratio.

Why would the government only lower the capital gains. Only a fraction of Canadians pay capital gains every year. It is more fair to lower a tax that every single Canadian pays everyday.

I personally would like the hands of government to be tied to prevent them from implementing more wastefull spending.
peter_puck





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PostPosted: Sat Feb 09, 2008 6:45 pm    Post subject: Reply with quote

Quote:

When you have over 450 billion in debt, an extra 10 billion paid against it makes very little difference. The government is much better off lowering taxes and growing the economy to reduce the debt to GDP ratio.


Well, the interest on that is about 600 million (maybe 400 if you factor in inflation). If you could wipe out the entire debt (which was part of Reforms platform at one point), you would have 27 Billion to spend. Look at how much has been saved by the cuts so far.

Quote:

Why would the government only lower the capital gains. Only a fraction of Canadians pay capital gains every year. It is more fair to lower a tax that every single Canadian pays everyday.


While economics is not my field, I have read numerous places that the tax on capital gains is a drag on the economy. When companies can raise capital, they spend it on equipment, thus increasing the strength of the economy. I would do it like Mulroney did, maybe a lifetime capital gains exemption of 1 million or so. (So all the money does not go to the Thompsons)
When you give extra money to making $10 000 or so, it tends to go on Ipod Nanos (SP)imported from the US -it goes towards consumption. This has a short term impact on the economy, but not a long term impact.


Quote:

I personally would like the hands of government to be tied to prevent them from implementing more wastefull spending



I guess you have a point there. Perhaps they could wrap it somehow so its not touched. "The national mortgage" perhaps. Just like the first government to run red ink would face a political penalty, maybe the first one to touch the mortgage payment would to ? Everyone knows (in Canada) that you have to pay the mortgage.
civicparties





Joined: 08 Jul 2007
Posts: 55
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PostPosted: Sat Feb 09, 2008 10:06 pm    Post subject: Reply with quote

Why should we have to file tax returns anyway?

1st - The majority of Canadians are employed therefore they get T4s and th government has that.

2nd - If you are retired, the government has a income slip from your sources of pension income

3rd - if you have interest and capital gains/losses, they also have records of the income

4th - if you are employed, every year an employee is required to file what deductions, dependents you have to determine what level of taxation you are to be tax at.

In the end, the government has all the needed information to calculate your tax return and send you money.

actually this is how it works in the UK

Quote:
Most employees do not get a tax return to fill in and have their income tax deducted at source by their employers or pension providers through the PAYE system, which will carry on as before.
We send tax returns to: directors ; employees and pensioners who pay tax at the higher rate (40 per cent) employees and pensioners with more complex tax affairs.


http://www.hmrc.gov.uk/sa/emppdir.htm
Cool Blue





Joined: 21 Sep 2006
Posts: 3130
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votes: 10
Location: Ontario

PostPosted: Sat Feb 09, 2008 11:17 pm    Post subject: Reply with quote

Quote:
Why should we have to file tax returns anyway?


I wouldn't trust the government to do my taxes. Tax deduction and credits are electable, you don't have to claim them and it isn't in their best interest for you to use them.

In fact, while I used to work Revenue Canada and under certain circumstanses (tax protestors) we would actually do their taxes for them based on the info we had at hand and we never arranged their taxes so they would pay the lowest tax.

Secondly, there may be some income that the government doesn't know about.

Interestingly, in the USA Obama is proposing that the IRS pre-fill tax returns with the info that they have on taxpayers to make it easier and quicker to do them.
Craig
Site Admin




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PostPosted: Sun Feb 10, 2008 1:34 am    Post subject: Reply with quote

civicparties wrote:
Why should we have to file tax returns anyway?

1st - The majority of Canadians are employed therefore they get T4s and th government has that.

2nd - If you are retired, the government has a income slip from your sources of pension income

3rd - if you have interest and capital gains/losses, they also have records of the income

4th - if you are employed, every year an employee is required to file what deductions, dependents you have to determine what level of taxation you are to be tax at.

In the end, the government has all the needed information to calculate your tax return and send you money.

actually this is how it works in the UK

Quote:
Most employees do not get a tax return to fill in and have their income tax deducted at source by their employers or pension providers through the PAYE system, which will carry on as before.
We send tax returns to: directors ; employees and pensioners who pay tax at the higher rate (40 per cent) employees and pensioners with more complex tax affairs.


http://www.hmrc.gov.uk/sa/emppdir.htm


It is a very good point. The tax system should be simplified to the point that the government can track the information needed to determine tax levels. The problem now is that there are so many deductions and what not that the government can't keep track of everything without hiring an army of people to process the information OR require businesses (like childcare) to fill out a ton more paperwork.
peter_puck





Joined: 15 Dec 2007
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votes: 1

PostPosted: Sun Feb 10, 2008 8:52 am    Post subject: why to file a tax return Reply with quote

Quote:

Why should we have to file tax returns anyway?

1st - The majority of Canadians are employed therefore they get T4s and th government has that.

2nd - If you are retired, the government has a income slip from your sources of pension income

3rd - if you have interest and capital gains/losses, they also have records of the income

4th - if you are employed, every year an employee is required to file what deductions, dependents you have to determine what level of taxation you are to be tax at.



There is simply way to many things the government does not know about. Way to many little deductions.
While the single guy with a T4 may qualify, there is too much other stuff. Donations, tuition, child care, private mortgages,pension from the old country, home based business, basement I am renting out, disabled mother living with me. There is also medical expenses (I would not want them faxed to the tax department).


They could do it like most countries, a flat fax on income sorta thing, but thy would have to gut alot of the current tax laws to do it.
Sheila





Joined: 09 Feb 2008
Posts: 556
Reputation: -6.8
votes: 16
Location: Central Alberta

PostPosted: Sun Feb 10, 2008 12:02 pm    Post subject: Reply with quote

Hi Peter, I agree with you. It's just that the majority of Canadians rate their current government on how much money they have in their pockets. Most people are not as politically savvy as you. Most would take what the CBC says at face value and we know how wrong that is. So if they notice a bigger refund this year compared to last year, they will more likely vote in PM Stephen Harper again. I take that back, they probably aren't the ones that vote.
In regards to medical expenses, if you get your prescriptions at the same place, just go in and ask them to print off a year to date for 2007. It's all on one page and you don't have to keep those little receipts. If you have to drive more than 40km one way to see a doctor, you get to claim the km (rates are different in all provinces) and the meal, with no receipts, you just have to prove you were there. So if I drove 100 km to see my doctor and the appointment was at noon, then I would be able to claim 200 km (there and back) x .48 = $96 for km and $17 for a meal. This is great for people who live in rural areas.
If you are on medicinal marijiana, there is a claim for that too, LOL.
kwlafayette





Joined: 03 Sep 2006
Posts: 6155
Reputation: 156.2Reputation: 156.2
votes: 28
Location: Saskatoon Saskatchewan

PostPosted: Sun Feb 10, 2008 10:45 pm    Post subject: Reply with quote

I am trying out taxfreeway this year, the past few years I have been using taxtron. Anybody know what the best tax software is?

At $9.95, if 8 million people bought that, that would be close to $80 million spent simply because our tax system is too complex.
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