New blog post
You and Tax Credits, a paradigm shift?
Do you jump for joy, say woo hoo! and take your significant other out to dinner every time you withdraw money from the bank? Why are you so happy when you receive a tax refund? Are you, like most people, happy when you receive a tax refund because you feel you’ve just received a windfall and gotten something for free?
I find peoples reaction to getting a tax refund puzzling, or at least interesting. This is after all your own money that you had deposited with the bank of Canada, interest free!
Now lets think about it? Tax refunds are your money! May I say that again? Tax refunds are your money! The government is not giving you their money or your neighbours money. They return to you your own money! The government will even return to you some of the last 10 years of deposits you have made…. uhm.. without interest. While they make it easy (through payroll deductions) and sometimes mandatory (through instalment payments) for you to make regular deposits, making a withdrawal is a bit more complicated. The only way you can withdraw your money is by filling out a withdrawal slip (filing a tax return or tax adjustment) and claiming the credits you are entitled to. Unfortunately, many of you file your tax returns and get less tax returned than you should because you do not claim all the credits you are entitled to. Sadly some of you don’t think you ‘deserve’ all your credits and disproportionately contribute to the Canadian economy. N.B. The CRA will not likely ask you to file if they know you will be making a withdrawal. We all have to contribute, but if you get a refund, that means you’ve deposited too much money!