There are all kinds of reasons why Canadians either do or, in some cases, don’t file their taxes annually, according to a study released by Toronto-based BMO Nesbitt Burns Inc. on Friday.
BMO’s Psychology of Taxes Study found that 94% of Canadians file their personal income tax returns each year. Of those Canadians, 52% file their taxes on time every year because “it is the right thing to do.”
Another 28% of people surveyed said they file on time because they expect a refund, while 22% believe that not filing annually would only make their taxes more complicated in future. For 11% of Canadians the fear of being audited is what keeps them meeting the April 30 deadline.
There are still 6% of Canadians who don’t file annually, according to BMO’s study. Of those, 24% use the excuse that they are two busy to send in their tax return while another 17% say they don’t make enough money for it to be worthwhile. Twenty per cent of Canadians claim they don’t know how to file their taxes.
Advisors who suspect their clients are avoiding filing their taxes because they find the task daunting should introduce the individuals to a tax professional, says John Waters, vice president, head of tax and estate planning, wealth planning group, BMO Nesbitt Burns, so they can avoid paying any interest or penalties.