It’s only when the time comes to explain certain concepts to our children that we realize that we, parents, do not know everything. As tax season approaches, our kids will hear us say the words taxes and reimbursement many times and they will most probably have lots of questions. In order to give them the right answer, we asked Gerry Vittoratos, tax expert at UFile, to help us answer the most frequent questions our children ask.
What are taxes?
Taxes are the sums of money the government deducts from our salary in order to fund the services it provides us.
Why do we need to pay taxes?
We need to pay taxes in order for the government to have the funds necessary to pay for the services it provides us. For example, your school, your favourite park, the municipal library; the government pays for all these services with the money it generates from the taxes we pay.
How does it work?
The government can collect taxes by keeping part of our annual salary (income tax) or by charging us an additional amount on the products we buy (sales taxes).
Does everyone pay the same amount of taxes?
No, it depends on your annual salary and on your total purchases during the year. The higher your salary and the more products you buy, the more taxes you will pay. The tax rate increases progressively during the year depending on the revenue you generate.
What happens if I do not pay my taxes?
The government will not be very happy. It can even be mad at you! In this case, it can charge a penalty fee (an extra amount you will need to pay) in addition to the taxes you already have to pay.
At which time do we have to submit our tax declaration?
For income taxes, we have until April 30th of the following year to file our declaration. For example, for the 2016 taxation year, we have until April 30th, 2017 to file.
This year, let’s talk tax with the expert! UFile is launching a microsite offering tips and tricks devoted to taxpayers for every stage of their life, offering moments of learning and discovery by means of questions and answers, of know-how, of stories, of convincing evidences and of points of view. Learn everything you need to know on taxes and share the information. Let’s talk tax!
* Content developed in partnership with UFile.