Tax Season has officially kicked off!
The Do’s and Don’ts of Filing your upcoming taxes you should know!
Now that we are in to the 2022 Tax Season, it is a really good time to take a look at your goals for this year. Determining your goals will help you decide how you should file your taxes, especially if you are self employed. As I am sure you are aware, it has been increasingly difficult to get a mortgage if you are self employed as of late.
On one hand you want to lower your income by using as many expenses as you can to reduce the amount you pay in income taxes. On the other hand, doing so reduces the amount of income you have to work with for qualifying for a mortgage.
Prior to submitting your taxes, perhaps before you contact your accountant, I would suggest you ask your self the following,
· Is my mortgage coming up for renewal this year or the next year? If so, as lenders may require your income for 2022, you will want to make sure your income is high enough to qualify. Further, in a lot of cases lenders will require a 2 year average, so you will want to be sure to plan this year for a renewal in 2024.
· Do I plan to purchase a new home this year? Again, if so, most lender’s will require that your taxes are filed for 2022 for a couple of reasons. They will want to use it to determine what income they can use to qualify you. Further, they use your notice of assessment from CRA to determine if you owe any money to Revenue Canada.
· Am I planning to refinance or pull equity out of my home? Same applies as above, you will want to be sure your income is high enough to qualify. As well, if you owe Canada Revenue Agency any money, you will have a great opportunity to use your home’s equity to clear the debt to avoid any penalties and late charges.
As your mortgage advisor, whatever your goals, I can help you determine the best strategy to deal with your taxes and make sure you are put in the best possible position.
· Plan far in advance if renewing, purchasing, or refinancing in the next couple of years. Doing so can put you in the best possible position to accomplish your goals.
· Planning ahead can get you access to the best rates and mortgage products available.
· Contact a professional to help you with your taxes, especially if you are self employed. Taxes have become more complicated over the years and a professional can assist you in obtaining your goals while still getting the best return, or rather to avoid paying too much to Canada Revenue Agency.
· I can offer free advice prior to filing your taxes and offer you advice based on your specific needs.
· If you owe Revenue Canada money and you have enough equity in your home, I can help you with a strategy to clear that up.
Please feel free to contact me for your free / no obligation consultation. I would be happy to assist you.