Tax season is fast approaching. Whether you’re filing taxes for the first time or have done it for years, understanding the process will save you time, stress, and even money! Yes, you could potentially avoid paying thousands of dollars by claiming eligible credits and deductions. 

Filing your 2024 taxes in Canada doesn’t have to be complicated. In this guide, we’ll take you through everything you need to know about filing your taxes in Canada, including important deadlines, how the process works, a checklist of required documents, and tips to maximize your tax return. 

When Can I Start Filing Taxes for 2024 in Canada? 

February 24, 2025, is the earliest date you can file your taxes online with the CRA. 

Important Tax Deadlines for 2025

For most Canadians, the last day you can file your taxes is April 30, 2025. If you owe taxes, you must also pay them by this date. 

If you are self-employed, you get an extra month and a half to file your taxes. The deadline for self-employed individuals is June 15, 2025. Since that falls on a Sunday, your return will be filed on time if the CRA receives it on or before June 16, 2025. 

If you owe the CRA money, you still need to pay by April 30, 2025, to avoid interest (whether you are self-employed or not). 

What happens if you miss the deadline?

If you owe taxes and file late, you will be charged a late filing penalty and interest on the amount due. The CRA charges 5% of your 2024 balance owing, plus 1% for each additional month you’re late (up to 12 months). 

And that’s not all–you’ll also be charged the prescribed interest rates. 

So, be sure you file your taxes well before or on time so you don’t get hit with these fees. 

If you miss the deadline to file your taxes but don’t owe any money, you won’t be penalized. However, it’s best to file on time to avoid delays for your refund. 

How Does Income Tax Work in Canada? 

Here’s a little breakdown of the Canadian tax system in case you’re not too sure how it works:

Canada uses a progressive tax system, which means the more you earn, the more you pay in taxes. Your income is taxed in brackets, so only the portion that falls into a higher bracket is taxed at that rate. 

For example, let’s say you live in Quebec and made $60,000 in 2024. Here’s how you would be taxed:

Federal Tax: 

• The first $53,359 is taxed at 15% ($8,003.85)

• The remaining $6,641 is taxed at 20.5% ($1,361.40)

= $9,365.25

Provincial Taxes (Quebec):

• The first $49,275 is taxed at 15% ($7,391.25)

• The remaining $10,725 is taxed at 20% ($2,145)

= $9,536.25

Combined Federal and Provincial Taxes (before deductions, contributions, etc.): $18,901.50

Note that these calculations are only an estimate to give you an idea of the tax rates in Canada. Everyone’s situation is different, and this does not reflect how much you will pay during tax season. For a more precise calculation, consider using an online tax calculator. 

Types of Taxable Income

Most types of income are taxable, including:

• Employment income (from a job on a T4 slip)

• Self-employment or freelance income (must be reported even if you don’t have a T4)

• Investment income (capital gains, dividends, interest)

• Government benefits (some, like EI, are taxable)

• Rental income (if you rent out property or Airbnb)

Deductions vs. Credits: How to Reduce Your Tax Bill

You can reduce your taxable income or the tax you owe through deductions and credits. If you use online tax software, it will walk you through each of these deductions, making it easy for you to claim them. 

Deductions reduce the amount of your income you’ll have to pay tax on. For example, RRSP contributions lower your taxable income, meaning you pay less tax. Other deductions can include childcare expenses, self-employment costs, and moving expenses. 

Credits directly reduce the amount of tax you owe. For example, the Basic Personal Amount gives you a tax-free portion of your income (around $15,000). Other credits can include the disability tax credit, medical expenses, and tuition credits. 

Refund vs Balances Owed

After filing your taxes, you’ll get a Notice of Assessment (NOA) from the CRA, which tells you whether you will get a refund (if you overpaid taxes throughout the year) or owe money (if you didn’t pay enough in taxes). 

Your refund depends on how much tax was deducted from your paycheques vs what you actually owe based on deductions and credits. 

What Do I Need to File My Taxes in Canada? 

Before you start filing your taxes, you’ll need the following documents:

• Personal Info: SIN, address, banking details (for direct deposit)

• Income Slips: T4 (employment), T5 (investments), etc. 

• Deductions & Credits: RRSP contributions, medical receipts, etc. 

• Previous year’s Notice of Assessment (NOA): Helps verify past tax info. 

If you’ve filed your taxes before, most online tax software automatically imports your details and the previous year’s information, so you don’t need to manually collect it. 

How to File Taxes in Canada for the First Time 

If you’re filing for the first time, don’t worry–it’s easier than you think! Generally, you have three options for filing your taxes. We strongly recommend filing them online, as that’s the fastest and easiest way. 

Option 1: File Online (Recommended)

Here’s a very brief summary of how to file taxes online:

1. Log into CRA My Account.

2. Choose a tax software appropriate for your situation (e.g., Wealthsimple Tax, TurboTax).

3. Go through the guided process and enter your income and deductions as prompted. 

4. Review and submit your return. 

5. Wait for your Notice of Assessment to confirm your refund or balance owing. 

Option 2: File by Paper

Opt-into the paper return option, and you should receive it by mail by February 24, 2025. 

Where can you mail your tax return in Canada? Fill out the tax package and mail it to the appropriate CRA tax centre. 

Option 3: Hire a Tax Professional

If you have a complex tax situation (e.g., you own a business or have rental properties), you might want to consult a tax professional to maximize deductions and simplify the process. 

For a more detailed official resource, check out this post on filing your taxes for the first time. 

How to Maximize Your Tax Return in Canada 

Everyone wants to get the biggest tax refund possible. Here are some strategic ways to ensure you’re paying only what you owe and claiming all the credits and deductions available:

• Contribute to an RRSP before the deadline. Any contributions you make before March 1, 2025, can be deducted from your 2024 taxable income. 

• Claim all eligible tax credits. Some commonly overlooked credits include the tuition tax credit, home office expense deduction, and medical expenses credits. 

• Apply for the Canada Workers Benefit (CWB). If you made a low to moderate income last year, you might be eligible to receive over $1,000. 

• File your taxes on time. It might seem obvious, but filing your taxes late can mean you owe more to the CRA if you’re not expecting a refund. 

• If you’re self-employed, claim all eligible expenses. Keeping detailed records throughout the year and claiming expenses such as business supplies, vehicle expenses, and, in some cases, rent payments, can save you thousands. 

Pro tip: Use Chexy to pay rent and bills with your credit card to easily keep track of your payments (and earn some rewards!). 

How to Pay Taxes Owed Online

If you owe taxes instead of getting a refund, you’ll need to pay them before the April 30, 2025, deadline to avoid penalties and interest. The good news is that there are many ways to pay your income tax online, which include: 

• Bank transfer 

• Debit card

• Pre-authorized-debit payments

• Through the mail

• Using a third-party service provider

Learn more about the different ways to pay the CRA. 

Filing your taxes doesn’t have to be stressful. With free tax software, online resources, and a little preparation, you can file your taxes stress-free and maximize your return. 

If you’re a renter, using Chexy can help you track rent payments, improve your credit score, and simplify tax filing when claiming applicable credits. 

Get started with Chexy today. 

Subscribe to our newsletter below for up-to-date credit card, travel, and rental content.

Common FAQs About Filing Taxes in Canada

What does it mean to get audited? Will I be audited?

A tax audit is when the CRA reviews your tax return in detail to ensure you filed your taxes correctly and didn’t report anything below what you actually made. Most people don’t have to worry about audits as they are random and only likely if:

• Your credits or deductions are higher than average for your income level 

• You’re self-employed or have cash-based income

• You reported large charitable donations or business expenses

• Your tax return is largely inconsistent compared to previous years

If you’re audited, the CRA will ask for supporting documents like bank statements and receipts. As long as your return is accurate, you shouldn’t have anything to worry about. 

What if I lived in two provinces last year? 

If you lived in more than one province last year, you’ll need to file your taxes for the province you lived in on December 31, 2024. For example, if you moved from Ontario to Quebec in August 2024, your tax return should be based on Quebec’s tax rates. 

If you’re in Quebec, keep in mind you’ll need to file two separate tax returns: a federal return for the CRA and a provincial return for Revenu Quebec. 

You may also be eligible for moving expense deductions if your move was for work, business, or full-time education. 

Do I have to file taxes if I didn’t work in 2024?

Even if you had no income in 2024, it’s still a good idea to file a return. You might be eligible for government benefits, like the GST/HST credit or the Canada Child Benefit. If you also paid tuition, you can claim the tuition tax credit and carry it forward for future years. 

How do I check my tax return status?

Once you file your tax return, you can check the status through the CRA My Account, CRA’s automated phone line, or your tax software. Most tax returns processed through NETFILE take about 2 weeks, while paper-filed returns can take up to 6-8 weeks to process.