He might be able to file below the Voluntary Disclosures Program (VDP). In response to the Canada Income Company (CRA), “the VDP grants aid on a case-by-case foundation to taxpayers and registrants who voluntarily come ahead to repair errors or omissions of their tax filings earlier than the [CRA] is aware of or contacts them about it.”
In case your boyfriend owes tax, he’ll nonetheless should pay it, however the late-filing penalties, and a few or all the curiosity, could also be waived.
For those who stay collectively, you’re in all probability thought of common-law by the CRA, Alison. That’s as a result of the company’s definition of common-law contains companions dwelling collectively in a marital relationship for not less than 12 consecutive months. Within the yr you hit that 12-month mark, you need to file your tax return as common-law. And you need to notify the CRA by the tip of the month following the month your standing modified.
Frequent-law tax advantages
Listed here are a number of the impacts of submitting as common-law spouses:
- Eligibility for some authorities advantages is predicated on household earnings as a substitute of particular person earnings
- Frequent-law spouses can mix medical bills and donations and should obtain a bigger mixed tax financial savings than when submitting as single people
- If their earnings was low, companions can declare a tax credit score generally known as the partner or common-law accomplice quantity
- Spouses can contribute to a spousal RRSP
- Spouses can cut up eligible pension earnings
In your case, Alison, your boyfriend’s low earnings in 2020 and no earnings since then might entitle you to say the above-mentioned partner or common-law accomplice quantity as a tax credit score. The financial savings for 2024 are as much as $2,356 federally and between $532 and $2,189 provincially relying on the place you reside.
Nonetheless, if you’re receiving advantages just like the Canada Little one Profit, GST/HST credit score, Canada Carbon Rebate (previously generally known as local weather lively incentive funds), or Assured Revenue Complement (GIS), there could also be a change in these advantages in the event you replace your submitting standing to common-law.
Why to get caught up in your taxes
Finally, your boyfriend might want to get his taxes sorted and updated, Alison. It’s higher to take action voluntarily, versus having the CRA assess massive penalties and curiosity. In case your boyfriend lives with you and is supported by you, his monetary state of affairs has a direct affect on yours. It additionally has an oblique affect to your tax return and authorities advantages.
If you file your tax return, you certify that the knowledge given in your return is appropriate, full and absolutely discloses your entire earnings. As such, you need to file your tax return precisely, Alison, regardless of your boyfriend being behind on his personal returns.