Conquering my fear of taxes was not an easy feat. Growing up, one of my Dad’s favourite expressions, aside from “pull my finger”, was this: “There are only two things certain in life; death and taxes.” Needless to say, I didn’t view taxes in the most positive light.
For many years, I delegated my income taxes to someone else — my dad, my husband, my accountant. When I started my own business though, I really felt that in order to understand my business inside and out, I should do my own. Doing so presented an opportunity for me to analyze my business, as well as do some financial planning for my future. While I can’t say I relish tax time, I have come to appreciate it as a time for financial self-reflection.
My former fear of taxes isn’t uncommon. In fact, according to a TurboTax survey, a full 41% of Canadians aren’t comfortable filing their own taxes. Fearing they lack the knowledge, and worrying they’ll miss something, many Canadians pass the task on to someone else. Some other interesting facts to come out of the TurboTax survey include:
- Approximately 3.2 million Canadians would rather get a colonoscopy if it meant getting out of doing their own taxes.
- Another 3.2 million would rather deliver a presentation in their underwear than do their own taxes.
- Finally, almost one-quarter of Canadians would prefer to retake their driving test instead of filing their own taxes.
How then do we change the narrative and make tax time less intimidating? For me, that meant taking the following steps.
The whole receipts in a shoebox thing is just a really bad idea. I know, because that’s essentially what I would do, throwing everything in a big box and ignoring it for a year. No wonder I would feel completely overwhelmed trying to sort through it come tax time.
Part of getting a handle on my own taxes meant getting the paperwork under control. I now file receipts monthly, and keep all expenses I’ll be deducting organized. In addition, I keep a file labelled Current Tax Year in my office where I keep all relevant family deductions that include medical expenses, charitable receipts, RRSP slips, and more. Staying organized throughout the year, prevents me from doing a last-minute scramble to find what I need.
Giving Myself Time
I am not a tax expert, so I don’t put undue pressure on myself by thinking I’ll sit down and fly through my taxes in an hour. With TurboTax, I start early and when I feel like I need a break, I save it and come back to it later with fresh eyes.
This year, I’ll also be taking advantage of TurboTax Live. TurboTax Live is a new tax preparation experience that brings an extensive virtual network of TurboTax Experts to my fingertips. With TurboTax Live Assist & Review, I can quickly connect to a live TurboTax Expert on the screen to ask questions at any point while I’m filing my tax return.
This provides me with a massive boost in confidence this year, especially since I’ll be able to screen share my questions with a TurboTax tax expert through SmartLook. This will allow my expert to highlight next steps right on my screen, and can help me find credits and deductions to maximize my refund, meaning there is no confusion for me.
Nothing opens your eyes to your own financial situation then adding up how much you spent eating out during the year, or how short you were in meeting your RRSP Contribution Limit. This is the biggest benefit of doing my own taxes. It means I have to take a hard look at where my money is going.
The reality is that a third-party tax provider will never tell me I’m spending too much or not saving enough. Their goal is to simply get my taxes done, not provide financial advice.
Since taking over my taxes, I have acquired more confidence in all aspects of my financial situation. I’m more willing to invest, and I’ve become much more aggressive with my savings. I now use tax time to track financial goals and as an annual check-in to ensure I’m meeting them, which actually makes doing my own a good thing. Fear of taxes be gone. I have full control over my financial situation.
If you’re ready to jump in and do your own taxes this year, visit TurboTax Canada to find out which product is right for you. A simple quiz on their site will help determine your comfort level and can determine if you need a little help (you can do it on your own), some help (you need an expert to consult), or a lot of help (TurboTax Live Full Service will prepare, review, and file your return entirely on your behalf.)
Disclosure: I was compensated by TurboTax Canada to share my tax story. All opinions expressed within are mine alone
Enjoyed your article. Much truth in what you stated. The older I get, the more I realize the more I have ME together, the better my finances become. When i allow things to get a bit off track with myself, then my finances soon follow.