Are you one of the many Canadians who hire a professional at tax time? Or are you still biting the bullet and doing your own? Taxpayers today are making more and more use of a tax professional in many ways. From doing a basic return, to extensive planning of real estate, investments, employment expenses and businesses. Tax planning is as complicated as it’s ever been. This short list is an excellent start to help clarify the benefits of engaging the services of a professional. It is based on many years of helping our clients legally reduce their tax liability.

Not Familiar With Tax Laws-The tax laws can be very intimidating to the average person doing their own taxes. About 30% of the population files their own return, while 60% of the returns filed are done by a professional. That’s over 14 million professionally filed and it is growing by estimated 100,000+ per year. That’s growth of more than the population of all three of our territories each year! Increasingly complex tax laws are only one reason this is happening. If your working full time at something totally unrelated to taxes and only dedicate an hour each year doing yours, no wonder more and more are paying the small amount to hire a professional. Also, there is more than one way mathematically to prepare a return correctly. Are you getting the most tax efficient one? That’s why a company like H & R Block has been thriving for years. If you don’t understand the tax jargon like they do, you’re likely to get lost fast!

Not Enough Time-The average Canadian is more pressed for time than ever before. Have you ever wondered why daycares and nursing homes are a booming business? It’s not so much because people don’t know how to perform these functions, but they are expected to put more time into their work than ever before. The days of 9-5 are disappearing faster than ever. Therefore, when it comes time to taxes, many just can’t get into the frame of mind to get the task done. Time management and stress reducing are big ticket education items in North America compared to 20 years ago? Why? We are just moving faster as a planet and need to delegate more.

Concerned about Paying Too Much Taxes-There are no official statistics to illustrate how much Canadians overpay in taxes, however CRA does plan for back claims with a contingency fund. Basically, you can go back up to 10 years and claim any overpaid taxes. However, the best way to avoid this is to prevent overpaying at the time of filing. Most professionals should have a checklist to help you prepare.

Changed the Way Income is Earned-Have you worked for an employer for many years and suddenly got downsized? Do you want to start a business or want buy rental property? Do you now have expenses to pay on your new job which the employer will not re-reimburse you for? These are all new changes which will dramatically change the way you are taxed.

Family Situation Has Changed-This can encompass a variety of different scenarios from getting married, divorced, living common-law, children arriving/leaving, tuition, daycare expenses, senior parents/dependants arriving/leaving, disabilities, changing residents, medical expense, donations, legal costs and more. It is too difficult to even get into this subject in this short space, as it can be very long and complicated. If you don’t understand this, you really need professional advice, as they will be your best bet for assessing the situation and listing your options.

Afraid of Being Audited-This is one of the ugliest words when it comes to taxes. Unfortunately, there is a lot of misunderstanding, more on the taxpayers part, when it comes to audits. Canada’s tax system is based on a self-assessment of income and expenses. In order to maintain the integrity of the system, they from time to time have to check receipts, especially when the return is E-filed (with no paperwork). While CRA may have confidential methods of selecting particular returns for audit but you can check out the main system at www.craarc.gc.ca/tax/individuals/topics/income-tax/reviews/menu-e.html. A good professional will prepare your return as if you will be audited. Therefore if it does happen, you simply follow CRA’s instructions which are usually providing them with details & receipts of the claim amount. Ottawa Tax Services prides itself on preparing your taxes with ‘peace of mind”. You will not have to always be “looking over your shoulder” for the taxman.

Want to Change Financial Portfolio-More and more Canadians are diversifying their portfolio from GIC’s, bonds and savings accounts to stocks, derivatives, commodities and private holdings. Why? Greater chance of returns and tax breaks. For example, gains in stocks are not only taxed at a lower rate, but the gains are deferred until you actually sell the stock. Also, there are off shore tax shelters which have certain tax reductions or exceptions. Make sure you check out their validity with an expert in this area. Ottawa Tax Services can recommend a professional if you find you’re up against this.

 Need Help sorting out a Tax Problem-If you have several years to file, have back taxes or are struggling with a few tax problems, it’s always wise to consult a pro. It’s impossible for anyone to know the answer to everything or even a great deal of problems. Certainly if you’re not in this business full time, the chances of your basic knowledge of taxes being above average are remote. While there is a lot of information, books and course out there that can help you develop the skills needed to handle your problem, you must question as to whether you can invest that much time, energy and money? Most can’t and it only makes sense to anti-up and get the right type of help.

Need to Delegate Some or all of the Tax Work-Sometimes you may not need the services of a complete tax package. Quite often, I have suggested a taxpayer delegate some of the work out and save money by doing the rest themselves. A perfect example is bookkeeping. In truth, it’s not difficult to do and you can save hundreds (sometimes thousands) of dollars. It’s a great way to get your family involved in the business and maybe even paying them for it. PTC Canada offers a range of tax and financial solutions to meet the range of client needs. One of the greatest problems a business person has, especially in the beginning, is delegating work out. If this goes beyond taxes and you need professional business advice, I suggest getting a business coach. Canadian Financial Fitness a company of business people who offer their expertise with your interest in mind. It is always a good idea to get an outside opinion of your operations to prevent your judgment from being biased. You can check out their website at www.canadianfinancial fitness.com.

When in Doubt, Get a Tax Professional-This not only applies for taxes, but in the rest of your business and life. In today’s world, it is becoming harder and harder to become a jack of all trades. The tax professional should have a variety of free materials for your use whether you want to use them or not.