Preparing Your 2024 Personal Income Taxes

Chris Hanley, CA, CPA, CFP® and Denika Heaton, BBA, JD, TEP, CEA
Mawer Tax and Estate Planning Specialists

Tax season is fast approaching, and the deadline to file your 2024 personal income taxes is just around the corner. For most Canadians, the filing deadline is April 30, 2025. If you or your spouse/common-law partner are self-employed, you have until June 16, 2025 (though any taxes owed must still be paid by April 30 to avoid interest charges). This practical guide will help you organize your documents and make informed tax decisions.

Note: This guide is general in nature, and everyone's income tax situation is unique. We recommend consulting with a qualified tax advisor to ensure you prepare everything needed based on your personal tax situation.

If You Were Employed or Self-Employed

Employment income will be reported on a T4 slip, but if your employment contract required you to pay expenses, you might be eligible to deduct work-from-home costs or other employment expenses. Self-employed individuals will need to complete their accounting of income and allowable deductions, including vehicle expenses if you use your car for work purposes. For those new to self-employment, consulting a tax advisor can provide valuable guidance on organizing this information effectively.

What to gather:

• T4 slips
• Form T2200 (Declaration of Conditions of Employment, if applicable)
• Records of employment or self-employment income and expenses
• Mileage logbook for vehicle use related to employment or business
• Union or professional dues

If You Made, Held, or Sold Investments

Investment income and capital gains must be reported whether or not an income slip is received, and whether your investing activity is made with a traditional investment brokerage, through a private investment, or a cryptocurrency exchange. Also, remember to claim any contributions to registered accounts, such as RRSPs, pension plans, or the new First Home Savings Account (“FHSA”), as well as any reporting requirements for foreign investments.

The federal government has postponed the planned increase to the capital gains inclusion rate that was outlined in the 2024 Federal Budget until January 1, 2026. The proposed change was originally set to take effect on June 25, 2024, and would have increased the taxable portion of capital gains over $250,000. The Canada Revenue Agency has confirmed it will continue applying the current inclusion rate.

Since this adjustment was announced after tax slips had already been issued, you may see 2024 slips and gain/loss summaries divided into two periods. However, all capital gains for the year will still be taxed at the existing 50% inclusion rate.

What to gather:

• RRSP and pension contribution receipts
• FHSA contribution records
• T3, T5, and T5013 slips (and details of income for which no slips were issued)
• Details of capital gains or losses
• Records of cryptocurrency transactions
• Documentation for investment management and counsel fees
• Interest paid on investment-related borrowings, including prescribed rate loans for family income splitting
• Foreign reporting information if the cost of your foreign investments exceeded CAD $100,000 (for example, foreign bank accounts, non-Canadian listed securities, or foreign real estate holdings other than a personal vacation property)

If You or a Family Member Enrolled in Advanced Education

Furthering one’s education can unlock valuable tax savings, some of which can be transferred among family members. Students and their families should ensure they’re claiming all available tuition credits, as well as provincial or territorial benefits where applicable.

What to gather:

• T2202A or TL11A forms (for tuition)
• Rent or residence receipts (for provincial tax credits, if applicable)
• T4A slips (for RESP withdrawals)
• Lifelong Learning Plan withdrawal information
• Details for claiming the Canada Training Credit
• Statements for student loan interest paid

If You Have or Sold Real Estate

Whether you bought or built your first home, made renovations to add a second unit or improve access for a qualifying family member, or earned income from rental properties, it is essential to gather the right documentation. If you began renting your property during the year, consulting a tax advisor can provide valuable guidance on organizing the income and expense information effectively.

Buying, building, renting, or renovating a residence (whether for personal use or rental), may also have GST/HST implications to discuss with your tax advisor. If you sold a property you owned for only a short period of time, you should also discuss whether the sale is subject to new property flipping rules.

What to gather:

• Home Buyers’ Plan withdrawal records
• Details for claiming the Home Buyers’ Amount Credit (available to first-time buyers)
• Receipts for eligible moving expenses
• Receipts for accessibility renovations, or for creating a self-contained secondary unit, for a qualifying senior or person with a disability
• Sale documentation for properties (including a principal residence, and a deemed sale such as a gift to family members)
• Rental income and expense records (for long-term or short-term rentals)
• Details of ownership and use of your properties (for underused housing or vacancy taxes, if applicable)

If You or Your Spouse Received a Pension

Eligible pension income offers opportunities for tax savings through splitting with a spouse and claiming the pension income credit. Ensure you have the necessary slips and details for any foreign pensions.

What to gather:

• Pension slips (e.g., T4A, T4RIF)
• Details of foreign pensions and related tax withholding

Other Credits and Deductions That May Be Applicable

Many Canadians can benefit from additional credits and deductions to help reduce their personal income taxes. Ask your tax advisor which credits can be combined with your spouse or dependents to maximize benefits.

What to gather:

• Receipts for medical expenses (expenses incurred in any 12-month period ending in 2024 can be used)
• Records of charitable donations (consider combining with your spouse) and political contributions
• Childcare expense receipts
• Statements for digital news subscriptions
• Proof of spousal support payments made

Disclaimers:

This communication is an overview only and it does not constitute financial, business, legal, tax, investment, or other professional advice or services. It is not intended to be a complete statement of the law or an opinion on any matter. If you (or any of your family members) are a U.S. citizen, hold a U.S. green card, or are otherwise considered a U.S. resident for U.S income/estate tax purposes, the Canadian and/or U.S. tax implications could be substantially different from those outlined herein. No one should act upon the information in this communication as an alternative to legal, financial or tax advice from a qualified professional. No member of Mawer Investment Management Ltd. is liable for any errors or omissions in the content or transmission of this email or accepts any responsibility or liability for loss or damage arising from the receipt or use of this information.

While we endeavour to ensure that the information in this communication is correct, we do not warrant or represent its completeness or accuracy. This communication is not updated, and it may no longer be current. To the maximum extent permitted by applicable law, we exclude all representations, warranties and conditions relating to this communication.