By: Dr. Amanda Wang
Along with spring cleaning, now is the time to file personal taxes! Personal tax filing is due by April 30.
This year has been a bit complicated for some because the Canada Revenue Agency (CRA) portal has not uploaded tax slips in their entirety, which means if you file your own taxes using an online service, you may not be able to use autofill function to reliably fill information for you. You will have to manually fill the lines based on the slips you have received or slips you can access from employers or financial institutions. Make sure to verify your income sources! Even if you think you may be missing some slips, do not delay filing as the CRA has not granted an extension to the deadline. Better to file on time now and if there are adjustments to be made, request a change to your tax return later.
Here are some other basic tax tips to consider:
- Maximize deductions: professional dues (e.g., Canadian Medical Association, provincial college fees), continuing education (e.g., courses, seminars, textbooks), medical supplies/equipment, home office expenses (if applicable), vehicle expenses (if used for work and you drive to more than one location for work in a day). Keep receipts and a mileage log!
- Contribute to your Registered Retirement Savings Plan (RRSP) and Tax Free Savings Account (TFSA): both investment vehicles are great ways to diversify savings. Your RRSP reduces taxable income and is a major tax deferral tool. Meanwhile, your TFSA isn’t tax-deductible when you contribute to it, but any growth in it is tax-free. Track your own annual RRSP and TFSA contribution rooms! Your annual notice of assessment and your CRA account will show the room as of April, but if you have made a contribution since then, the CRA site may not update that contribution and the room showing may longer be accurate. The RRSP contribution room is dictated by your personal income for the previous tax year. The deadline for contributing to your RRSP to count for the prior tax year is 60 days after the calendar year (this year was Mar 3, 2025 for 2024 taxes). If you contribute now in April, you will be contributing against 2025’s contribution room.
- Incorporation: whether to incorporate or not is an often debated issue, especially for new grads. Do not incorporate too early! Consult with experts (like an accountant or a fee-for-service financial advisor) about the best timing for you, if that time exists. Not everyone will benefit from incorporation, and with the legislative changes (and attempted changes) against corporations the last many years, it certainly is no longer as great of a tax savings measure as it once was.
Here are some general principles to see if incorporation is for you: you are earning more than you need for personal expenses, you’ve filled your other buckets (RRSP, TFSA – both have been shown to outperform a corporation over a long term horizon), you are comfortable with your debt load in a Line of Credit (LOC) if you have one, and you don’t have any big personal costs you are saving for (i.e., wedding, car, house, family planning). Remember you need to retain money in the corporation over time for it to make sense as a tax deferral vehicle.
Though we are physicians, who are experts in a very different field from that of money management, I am a big proponent of basic financial literacy for everyone. This knowledge can only help you to approach your financial future with confidence and independence. However, if you are not ready to take it all into your hands, there is no shame in relying on expert advice!
If there are any other tax/financial tips you’d like to see or questions you may have, please leave a comment below and we can try to address some questions in a follow up post.
Disclaimer: I am not a tax professional. The information provided is for general informational purposes only and should not be considered tax, legal, or financial advice. For personalized guidance specific to your situation, please consult a certified tax professional or financial advisor.
