Money Matters, Every Dollar Counts! -Filing Your Taxes

By: Eddie Twumasi-Smith, (P.Eng, PMP, CPA, MBA )

Greetings to all both near and afar. For some years now, I have been burdened by the rate of change across many nations and within geopolitical space, and across other continents and its impact towards racialized minorities. Out of these changes, there have been some government responses to implement new rules and adapt to increase the economic activities, external climate and improve the standard of living of all citizens. However, it is fair to say that these governmental strategies haven’t been equally advantageous or beneficial to all within the country and elsewhere.

Statistics Canada reports shows that, in 2021, 19.5 percent of Black people living in Canada were living below the poverty line. This is compared to 8.2 percent of White people, and 8.1 percent of Asian people. Now the question that comes to mind is, are these governmental legislations, rules and programs not applied consistently across the ethnic groups? Or are some people able to utilize and effectively optimize or leverage the external drivers or rules to their advantage more than others? I hold the believe that, as the good old book has stated, for lack of knowledge my people perish!

Further into the Bible, Ephesians 5:1516 adds to the above saying, “you live not as unwise but as wise, making the most of every opportunity, because the days are evil”.

The definition of “evil” in current context will be, the times and seasons are changing and these changes are coming fasters than we may think or are prepared for. So it is about time, we as our community take another looks at how we plan, prepare and perform financially in order to take advantage of government legislations and programs that are available so that our generation and future generations will benefit from it.

Report from Brookings Institute at www.brookings.edu/research suggests that

Black Americans born poor are much less likely to move up the income ladder than those in other racial groups, especially whites. Why? Many factors are at work, including educational inequalities, neighborhood effects, workplace discrimination, parenting, access to credit, rates of incarceration, and so on. But there is always a way that we can leverage the external factors and perform better than others; through wisdom, understanding, seeking knowledge and acting in a way that will benefit us and our families.

This column will be sharing and presenting some of the strategies we can adopt to improve our wealth to build a better future and re-write the current narratives which does not show that the black community is doing better as compared to others. But there is hope and together with one purpose, we can win this fight and make things better if we collectively think, strategize and act on what is worthy.

In today’s discussion, I would like to present the why we have to file our taxes and why it is important for us to recover some of these taxes that were taken out of our pay checks or other incomes: Some of the reasons why we need to file our taxes are as follows:

• When we dispose of capital property (for example, sold real estate, a principal residence, or shares) or realized a taxable capital gain;

• When we are required to repay all or a portion of any Old Age Security benefits or Employment Insurance benefits received;

• When we have withdrawn amounts under the Lifelong Learning Plan or the Home Buyers’ Plan that have not been repaid;

• When we are required to make Canada Pension Plan contributions, because pensionable employment income and/or selfemployment earnings total more than the basic CPP exemption ($3,500 for 2022);

• When we are paying Employment Insurance premiums on self-employment and other eligible earnings (by choice);

• When we have applied for and received advance Canada Workers Benefit payments in the current tax year or want to apply for advance payments in the next tax year;

• Elected to split pension income with their spouse or commonlaw partner;

• Claimed a capital gains reserve on last or prior year’s return;

• Incurred a non-capital loss and want to be able to apply it to other years;

• Want to carry forward unused amounts from the current year return, such as tuition fees or RRSP/PRPP contributions;

• Want to claim the Canada Workers Benefit for the current tax year;

• Want to report income in order to keep their RRSP/PRPP deduction limit up to date (also applicable to very young individuals);

• Want to receive the Goods and Services Tax credit or Harmonized Sales Tax credit (GST/HST credit) or any related provincial or territorial credits;

• Want to begin or continue receiving the Canada Child Benefit or any related provincial or territorial benefits (in this case, if the individual is married or living commonlaw, the individual’s spouse or common-law partner must also file a return);

• Want to receive or continue receiving the Guaranteed Income Supplement or Allowance Benefits from the Old Age Security program; or

• Want to claim the Climate Action Incentive (Alberta, Saskatchewan, Manitoba, and Ontario only).

• Want to claim a refund;

• Received a demand to file a return from the CRA.

The above are some of the reasons why we need to file our taxes and earn something back, since the government provide all avenues for residents in Canada to get back what is “unduly” an over taxed income and hence from this, we can invest into other portfolios or investments to improve our social and financial resources and hence our ability to cover some routine expenses and needs

As acommunitywe should take another look at how we plan, prepare and perform financially in order to take advantage of government legislations. Finally, lets be wise and show the usefulness of knowledge as stated in the good old book, for the lack of knowledge my people perish!

Please Note: For any comments, corrections or recommendations, please forward all to my email: eddiesmith77@gmail.com

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