How to get ready for a successful and smooth 2023 tax season?

2022 is over, and 2023 has just began.

First, I would like to wish you a Happy New Year, but also a “Happy 2023 tax season” on behalf of SJT CPA, your CPA in Montreal.

With this new year starting you’ve probably come up with new resolutions as usual. Whatever your resolution for the new year is, this is the best time of the year to set up new goals, even crazy ones… This year, one of my goals is to help taxpayers have a successful tax season and increase their tax IQ. Isn’t it a great idea?

After many years working as a professional accountant with hundreds of clients, I have noticed that one of the most challenging, stressing, and frustrating situations as a taxpayer is dealing with annual income tax filing. That’s why I’ve met clients who did not file their tax return for more than ten years, simply because of apprehension or lack of knowledge and clear guidance. Others may simply avoid or delay filing their income tax until the deadline has past, because of fear of the result or of the painful process, ending up paying interests and penalties to the CRA and Revenu Quebec.

You may think 2023 tax season is a long way off as it officially kicks off on February 20th. Or once again, you don’t want to hear about as it gives you some bad feelings. This should not be the case at all if you want to have a successful and smooth 2023 tax season. Now is the best time to think about your strategy, get ready and have your income tax filed the easiest way possible.

Here are five simple tips and advice from SJT CPA, your CPA in Montreal, on how to get prepared for a pain-free and successful 2023 tax season.

1. Create a file right now called 2022 income tax

As the new year begins, you will soon be receiving 2022 statements and tax slips from financial institutions, government agencies, employers and so on. Now is the time to open a file to classify the documents in one place as they arrive, so that you won’t have to spend time looking for them.

You may also decide to scan or take a picture of all tax documents as you receive them by mail and save them in an electronic file in case you lose the paper document. In addition, if you use the service of a tax preparer, he will be more than happy to receive your documents by email.

2. Make sure you have access to your CRA and Revenu Quebec My Accounts during the month of January

The second step is to ensure you have access to your CRA and Revenu Quebec accounts before the end of January as both agencies will be difficult to reach by phone starting the month of February. You will then avoid waiting over the phone for a long period of time.

For those who have already filed a previous year income tax, the CRA and Revenu Quebec have already open an online file where you can find your previous years notice of assessments along with some tax slips from financial institutions, employers, and government agencies. It is important you have online access as most of your 2022 tax slips will be available in those two files by the end of February, therefore making it easy to get them.

If you need to request access to your online accounts, you may call the following numbers: 1 (800) 959-8281 for the CRA and 1 (866) 423-3234 for Revenu Quebec.

3. Decide whether you need to make RRSP contributions before March 1^st, 2023

Another good strategy is to start thinking about your 2022 Registered Retirement and Saving Plan contributions, in case you did not contribute enough throughout the year. This will help avoid last-minute RRSP contributions during the busy season.

Your RRSP maximum deductible amount for 2022 is available on your 2021 federal Notice of assessment. RRSP contributions can significantly reduce tax burden or help get tax refund if used properly.

Make sure you ask your accountant for proper advice to make effective RRSP contributions and avoid over contributing. At SJT CPA, your CPA in Montreal, we can help assess and to optimize your RRSP contributions.

4. Find your trusted tax accountant as soon as you can

Many people can file their income tax themselves using software like TurboTax, Ufile or ProTax, but not everybody is comfortable doing so. In addition, this requires having basic knowledge of provincial and federal tax rules and having enough time to spent preparing your tax return, with the possibility of making some mistakes. That’s why I strongly advise to hire a professional accountant.

If you haven’t yet hired an accountant, it might be difficult to find a good one before tax season officially starts on February 20th. The reason is the busiest period for accountants is from January to June, and most accountants will stop accepting new clients soon as they want to focus their effort on existing clients with who they have already established a trusted relationship. Therefore, my advice is to start looking for your tax account as soon as possible since you may also know it is not easy to choose the right tax professional.

5. Check if your tax accountant is a CRA authorized representative and Revenu Quebec professional representative

To help relax and have a peace of mind during 2023 tax season, I will advise you hire a tax accountant who is a CRA and Revenu Quebec representative. A representative is accredited by the CRA or Revenu Quebec to prepare income taxes, submit electronically and represent the interests of their clients on tax issues. With your authorization, a representative can easily access your tax information at the CRA and Revenu Quebec to make sure all information are considered when preparing your income tax.

To give authorization to your CRA representative, you need to have access to your CRA online Account, and add his Rep ID to your profile as an authorized representative. For more information on an authorized representative responsibilities, click here.

For a Revenu Quebec authorization, you must sign an authorization form called MRW-69.RP to allow your representative to access your online file. Your representative will need several information such as your full name, address, and Social Insurance Number.

Lastly, it is important to mention that the information your share with your tax accountant is quite sensitive. Therefore, you need to make sure your information will be kept confidential and secure. For these reasons it is very important to have a trusted tax accountant who will help fulfill one of your most important duties as a Canadian resident, with professionalism and confidentiality.

If you haven’t yet found your trusted accountant and representative, feel free to contact SJT CPA, your CPA in Montreal. We are trusted and high rated professional accountants in Greater Montreal. For more information, please call (438) 725-5736.

With these advice on hand, I am confident that you will be soon enjoying your 2023 tax season with complete peace of mind, 😊.

Happy New Year and Happy 2023 Tax Season!

More topics to come during this year. Stay tuned!

Souleymane Junior Traore CPA

Founder of SJT CPA, your www.cpainmontreal.com