Federal Income Tax and Benefit Guide - 2018 - General information, identification and other information

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Is this income tax package for you?

This income tax package provides the basic information you need to get ready, complete and file your paper Income Tax and Benefit Return. Use this information along with the instructions on the return and schedules. It tells you what types of income you must report and which deductions and credits you can claim to help you figure out if you owe tax or if you will get a refund. Even if you had no income in the year, you have to file a return to get the benefits, credits, and refund you are entitled to.

This income tax package also applies to you if you resided outside Canada on December 31, 2018, and kept significant residential ties with Canada. To make sure you are using the correct income tax package, see Which income tax package should you use?.

What's new for 2018?

We outlined major tax changes and improvements to services below. We also noted changes to income tax rules that were announced but that were not yet law. If they become law as proposed, they will be effective for 2018 or as of the dates given. You will find more information about these changes throughout the guide. They are flagged with the word: New

The CRA’s services

Your income tax package has a new look. The 2018 Income Tax Package includes the Federal Income Tax and Benefit Guide, a Provincial or Territorial Information Guide, the return, schedules, and worksheets. Several changes were made to this package to save paper and enhance services.

These changes include:

  • using plainer language where possible
  • reducing the amount of instructions in both guides by moving some information to the return, schedules, forms, or other publications
  • reducing the number of schedules by eliminating schedules 4 and 12. You can now find any charts that were on these schedules on the worksheets
  • updating worksheets to include needed calculations that were previously found in the guide
  • creating a specific worksheet for: the return, Schedule 1, Form 428, and Form 479
  • presenting the package in order of importance and in numerical order. You still have two copies of the return and related schedules – a copy to send to the CRA and a working copy for your records

PayPal – You can make your payments using PayPal through a third party service provider. For more information, go to  Payments to the Canada Revenue Agency.

Individuals and families

For residents of Manitoba, New Brunswick, Ontario, and Saskatchewan - The Climate Action Incentive is a new refundable credit available as of January 1, 2018. For more information, see Schedule 14, Climate Action Incentive.

Employee home relocation loan deduction (line 248 of the return) – As of January 1, 2018, this deduction has been eliminated.

Medical expenses (lines 330 and 331 of Schedule 1) – Eligible medical expenses have been expanded to include a variety of expenses relating to service animals specially trained to perform specific tasks for a patient with a severe mental impairment.

Donations and gifts (line 349 of Schedule 1) – As of January 1, 2018, the first-time donor’s super credit has been eliminated.

As of February 27, 2018, registered universities outside Canada will no longer need to be prescribed in Schedule VIII of the Income Tax Regulations. For more information on qualified donees, see Pamphlet P113, Gifts and Income Tax.

Tax on split income (TOSI) (line 424 of Schedule 1) – As of January 1, 2018, in addition to applying to certain types of income of a child born in 2001 or later, TOSI may now also apply to amounts received by adult individuals from a related business. Where TOSI applies, the disability tax credit can now be used to reduce the individual’s tax payable for the year. However, income that is subject to TOSI must now be added to the individual’s net income for the purpose of calculating various deductions, credits and benefits. For more information, see Form T1206, Tax on Split Income.

Interest and investments

Investment tax credit (line 412 of Schedule 1) – Eligibility for the mineral exploration tax credit has been extended to flow-through share agreements entered into before April 2019. See Form T2038(IND), Investment Tax Credit (Individuals).

Accelerated Investment Incentive

The Fall Economic Statement 2018 introduced an accelerated deduction for Canadian development expenses (CDE) that a flow through share (FTS) investor receives from a principal business corporation (PBC). This tax measure applies to FTS agreements entered into after November 20, 2018 in regards to CDE incurred after the agreement date.

If you have invested in a FTS after November 20, 2018 and have received a statement of resource expenses from a PBC, you may claim CDE at the rate of 45% in the tax year in which such CDE is renounced to you and, thereafter, at a rate of 30%. See Form T1229, Statement of Resource Expenses and Depletion Allowance.

For more information, go to Accelerated Investment Incentive.

 

Do you have to file a return?

File a return for 2018 if:

  • you have to pay tax for the year
  • you want to claim a refund
  • you want to claim the working income tax benefit (WITB) or you received WITB advance payments in the year
  • you or your spouse or common-law partner want to begin or continue receiving the following payments (including any related provincial or territorial payments):
    • Canada child benefit (CCB)
    • GST/HST credit 
    • guaranteed income supplement (GIS) If you have a spouse or common-law partner, they also have to file a return.
  • the CRA sent you a request to file a return
  • you and your spouse or common-law partner are jointly electing to split pension income. See Line 115 of this guide
  • you disposed of capital property (which could be a principal residence) or you realized a taxable capital gain in the year
  • you have to repay all or part of your old age security or employment insurance benefits 
  • you have not repaid all the amounts you withdrew from your registered retirement savings plan (RRSP) under the Home Buyers’ Plan or the Lifelong Learning Plan 
  • you have to contribute to the Canada Pension Plan (CPP) for 2018. This can apply if your total net self-employment income and pensionable employment income is more than $3,500
  • you are paying employment insurance premiums on self-employment income or other eligible earnings
  • you have incurred a non-capital loss in the year that you want to be able to apply in other years
  • you want to transfer or carry forward to a future year the unused part of your tuition fees
  • you want to report income that would allow you to contribute to an RRSP, a pooled registered pension plan (PRPP), or a specified pension plan (SPP) to keep your maximum deduction limit (see Schedule 7) for future years up to date
  • you want to carry forward to a future year the unused investment tax credit on expenditures you incurred during the current year

Deceased persons

If you are the legal representative (the executor, administrator, or liquidator) of the estate of a person who died in 2018, you may have to file a return for 2018 for that person. When there are no legal documents, you may request to be the deceased’s representative by completing an Affidavit form for intestate situations. For more information about your filing requirements and options and to know what documents are required, see Guide T4011, Preparing Returns for Deceased Persons, and Information Sheet RC4111, Canada Revenue Agency – What to do following a death.

Due dates, penalties and interest

Due dates

Your 2018 return and payment are due on or before the following dates:

Person Return due date Payment due date
Most people April 30, 2019 April 30, 2019
Self-employed persons (and their spouse or common-law partner) with business expenditures that relate mostly to a tax shelter investment April 30, 2019 April 30, 2019
Self-employed persons and their spouse or common-law partner (other than those stated above) June 17, 2019* April 30, 2019
Deceased persons and their surviving spouse or common-law partner

See Guide T4011, Preparing Returns for Deceased Persons

*Since June 15, 2019, is a Saturday, your return is due the next business day (June 17, 2019).

Note

Form T1135, Foreign Income Verification Statement, must be filed on or before April 30, 2019, or June 17, 2019, if you or your spouse or common-law partner carried on a business in 2018 (other than a business whose expenditures are primarily in connection with a tax shelter). For more information, see Form T1135.

Did you know: Benefits

Did you know... 

Filing early ensures your benefit and credit payments are not delayed or stopped. These include:

  • guaranteed income supplement (GIS)
  • GST/HST credit 
  • Canada child benefit (CCB)
  • related provincial and territorial programs

If you have a spouse or common-law partner, they also have to file a return. For more information, see Booklet T4114, Canada Child Benefit, and Guide RC4210, GST/HST Credit.

Penalties

The CRA may charge you a penalty if any of the following applies:

  • you filed your return late and you owe tax for 2018
  • you failed to report an amount on your return for 2018 and you also failed to report an amount on your return for 2015, 2016, or 2017
  • you knowingly or under circumstances amounting to gross negligence have made a false statement or an omission on your 2018 return

For more information, go to Taxes.

Interest

Interest you must pay to the CRA

If you have a balance owing for 2018, the CRA charges compound daily interest starting May 1, 2019, on any unpaid amounts owing for 2018. This includes any balance owing if the CRA reassesses your return.

Note

The CRA may cancel or waive interest if you cannot meet your tax obligations because of circumstances beyond your control. To make a request, get and complete Form RC4288, Request for Taxpayer Relief – Cancel or Waive Penalties or Interest. For more information, go to Taxpayer relief provisions.

Interest paid to you by the CRA

The CRA will pay you compound daily interest on your tax refund for 2018. The calculation will start on the latest of the following three dates:

  • May 31, 2019
  • the 31st day after you file your return
  • the day after you overpaid your taxes

Cancel or waive penalties or interest

The CRA may cancel or waive penalties or interest if you cannot meet your tax obligations because of circumstances beyond your control. To make a request, get and complete Form RC4288, Request for Taxpayer Relief – Cancel or Waive Penalties or Interest. For more information, go to Taxpayer relief provisions.

Gather all your documents

Gather all the information slips, receipts, and supporting documents you need to report your income and claim any deductions or credits.

What if you are missing information?

File your return on time even if you do not have all of your slips or receipts. You are responsible for reporting your income from all sources to avoid any penalties and interest that may be charged. If you have not received your slip by early April or if you have any questions about an amount on a slip, contact the payer.

Did you know: Missing Slip Pay Stub

Did you know...

If you know you won’t be able to get a missing information slip by the due date, use your pay stubs or statements to estimate your income and any related deductions and credits you can claim. Enter the estimated amounts on the appropriate lines of your return.

Need help doing your taxes?

Community Volunteer Income Tax Program (CVITP) - If you have a modest income and a simple tax situation, volunteers from the CVITP can complete your tax return for free. To find out if you qualify for this service and to locate a tax preparation clinic near you, go to Free tax clinics or call the CRA at 1-800-959-8281.

If you want to become a volunteer, go to Volunteer to do taxes for people in your community.

Tax Information Phone Service (TIPS) - For personal and general tax information by telephone, use the CRA’s automated service, TIPS, at 1-800-267-6999.

By phone (individuals) - If you are calling from Canada or the United States, call 1-800-959-8281. The CRA’s automated service is available 24 hours a day, 7 days a week. The CRA agents are available Monday to Friday (except holidays) from 9 a.m. to 5 p.m. From the end of February to the end of April, these hours are extended to 9 p.m. on weekdays and from 9 a.m. to 5 p.m. on Saturdays (except Easter weekend).

By phone (businesses) - Call 1-800-959-5525. The CRA’s automated service is available 24 hours a day, 7 days a week. The CRA’s agents are available Monday to Friday (except holidays) from 9 a.m. to 6 p.m.

Teletypewriter (TTY) users - If you have a hearing or speech impairment and use a TTY, call 1-800-665-0354. If you use an operator-assisted relay service, call the CRA’s regular telephone numbers instead of the TTY number.

Ways to file your return

NETFILE – Use the CRA’s secure service to complete and file your return electronically using certified tax preparation software or a web tax application. Go to NETFILE – Overview for a list of software and applications, including some that are free.
EFILE – This is a secure CRA service that lets authorized service providers, including discounters, complete and file your return electronically. For more information, go to EFILE for individuals.

Note

Auto-fill my return – This secure CRA service allows you or your authorized representative to automatically fill in certain parts of your current-year return. You must be registered with My Account (or your representative must be registered with Represent a Client) and be using a certified software product (NETFILE or EFILE) that offers this option. For more information, go to Auto-fill my return.

File my Return – This is a free and secure CRA service available to eligible individuals who have low or fixed income and whose situations stay the same from year to year. If you are eligible, you will receive an invitation letter in the mail. You will then be able to file your income tax and benefit return simply by giving the CRA some personal information and answering a series of short questions through an automated phone service. You do not have to fill out any paper forms or do any calculations.

Filing a paper return – In the next section, find out which income tax package you need.

Which income tax package should you use?

Use the income tax package for the province or territory where you resided on December 31, 2018. However, there are exceptions, such as if you have residential ties in another place. For more information on these exceptions, see the chart below.

If you resided in Quebec on December 31, 2018, use the income tax package for residents of Quebec to calculate your federal tax only. You must also file a provincial income tax return for Quebec.

In the following situations, use the income tax package specified

Exceptions
Your situation
(see the definitions on the chart)
Use the following:
A. On December 31, 2018, you had residential ties in more than one province or territory. Income tax package for the province or territory where you have your most important residential ties. For example, if you usually reside in Ontario but were going to school in Alberta or Quebec, use the income tax package for Ontario.
B. You are filing a return for a person who died in 2018. Income tax package for the province or territory where that person resided at the time of death.
C. You emigrated from Canada in 2018. Income tax package for the province or territory where you resided on the date you left.
D. You resided outside Canada on December 31, 2018, but kept significant residential ties with Canada; you may be considered a factual resident of Canada. Income tax package for the province or territory where you kept your residential ties. Also, get and complete Form T1248, Information About Your Residency Status – Schedule D.
E. You resided outside Canada on December 31, 2018, and are considered a deemed resident or a non-resident of Canada. Income Tax and Benefit Guide for Non-Residents and Deemed Residents of Canada. However, if you earned income from employment in a province or territory, or earned income from a business with a permanent establishment in a province or territory, use the income tax package for that province or territory.
Definitions
Residential ties

Significant residential ties to Canada include:

  • a home in Canada
  • a spouse or common-law partner in Canada
  • dependants in Canada

Secondary residential ties that may be relevant include:

  • personal property in Canada, such as a car or furniture
  • social ties in Canada, such as memberships in Canadian recreational or religious organizations
  • economic ties in Canada, such as Canadian bank accounts or credit cards
  • a Canadian driver's licence
  • a Canadian passport
  • health insurance with a Canadian province or territory

To determine an individual’s residence status, all of the relevant facts in each case must be considered, including residential ties with Canada and length of time, object, intent, and continuity while living inside and outside Canada.

Note
You are a factual resident of Canada for tax purposes if you keep significant residential ties in Canada while living or travelling outside the country.

For more information, see Income Tax Folio S5-F1-C1, Determining an Individual’s Residence Status.

Deemed resident

You are a deemed resident of Canada for income tax purposes if:

  • on December 31, 2018, you were living outside Canada, you are not considered to be a factual resident of Canada because you did not have significant residential ties, and you are a government employee, a member of the Canadian Forces including their overseas school staff, or working under a Canadian International Development Agency (CIDA) assistance program. This can also apply to the family members of an individual who is in one of these situations
  • you stayed in Canada for 183 days or more in the tax year, do not have significant residential ties with Canada, and are not considered a resident of another country under the terms of a tax treaty between Canada and that country
Non-resident

You are a non-resident for tax purposes if one of the following applies to you:

  • you normally live in another country and are not considered a resident of Canada
  • you do not have significant residential ties in Canada, and one of the following applies to you:
    • you live outside Canada throughout the tax year
    • you stay in Canada for less than 183 days in the tax year

You may need to use one or more of the following publications if you did not live in Canada all year

Other publications you may need
Your situation Use the following:
You were a non-resident, and you earned income from employment or you earned income from a business with a permanent establishment in Canada. Guide T4058, Non-Residents and Income Tax
You were a non-resident, and you received rental income from real or immovable property in Canada. Guide T4144, Income Tax Guide for Electing Under Section 216
You were a non-resident, and you received certain other kinds of income from Canada (including pensions and annuities). Pamphlet T4145, Electing Under Section 217 of the Income Tax Act
You were a newcomer to Canada in 2018. Pamphlet T4055, Newcomers to Canada
You emigrated from Canada during 2018. Go to  Individuals - Leaving or entering Canada and non-residents
At any time in 2018, you were a non-resident of Canada receiving an old age security pension. Form T1136, Old Age Security Return of Income. For more information, see Guide T4155, Old Age Security Return of Income Guide for Non-Residents.

Step 1 – Identification and other information

Use the instructions provided on your return to complete Step 1. This will provide the CRA with information about you and your spouse or common-law partner, if you have one, as well as other information needed to process your return.

In this section of the guide, you will only find information you may need to supplement the instructions provided on the return.

Email address

If you would like to receive email notifications from the CRA, read and agree to the terms of use for email notifications below, and enter an email address. You can also register by going to My Account at My Account for Individuals and selecting the “Notification preferences” service.

Terms of use for email notifications – The CRA will send email notifications to the email address you have provided in order to notify you of any CRA mail available in My Account, and to notify you of certain changes to the account information, and other important information about the account. The notifications that are eligible for this service may change. As new types of notifications are added or removed from this service, you may not be notified of each change.

To view CRA mail online, you must be registered for My Account, and/or your representative must be registered for Represent a Client and be authorized on this account. All CRA mail available in My Account will be presumed to have been received on the date that the email notification is sent. Any mail that is eligible for electronic delivery will no longer be printed and mailed.

It is your responsibility to ensure that the email address provided to the CRA is accurate, and to update it when there is any change to that email address. CRA email notifications are subject to the terms of any agreement with your mobile carrier or Internet Service Provider. You are responsible for any fees imposed by them.

These email notifications are sent unencrypted and unsecured. The email notifications could be lost or intercepted, or could be viewed or altered by others who have access to your email account. You accept this risk and acknowledge that the CRA will not be liable if you are unable to access or receive the email notifications, nor for any delay or inability to deliver notifications.

These terms of use may be changed from time to time. The CRA will provide notice in advance of the effective date of the new terms. You agree that the CRA may notify you of these changes by emailing either the new terms, or notice of where the new terms can be found, to the email address that you provided. You agree that your use of the service after the effective date of any change to these terms constitutes your agreement to the new terms. If you do not agree to the new terms, you must remove the email address provided and no longer use the service.

Information about your residence

Enter the province or territory where you lived or of which you were considered to be a factual resident on December 31, 2018. The CRA needs this information to calculate your taxes, benefits, and credits correctly.

Information about you

For more information or to apply for a social insurance number (SIN), go to Employment and Social Development Canada.

Marital status

“Married” means you have a spouse. This applies only to a person to whom you are legally married.

“Living common-law” means you are living with a person who is not your spouse, but with whom you have a conjugal relationship, and to whom at least one of the following situations applies:

a) They have been living with you in a conjugal relationship for at least 12 continuous months.

Note

In this definition, 12 continuous months includes any period you were separated for less than 90 days because of a breakdown in the relationship.

b) They are the parent of your child by birth or adoption.

c) They have custody and control of your child (or had custody and control immediately before the child turned 19 years of age) and your child is wholly dependent on them for support.

Did you know: Common-law and Involuntary seperation

Did you know...

You are still considered to have a spouse or common-law partner if you were separated involuntarily (not because of a breakdown in your relationship). An involuntary separation could happen when one spouse or common-law partner is living away for work, school, or health reasons or is incarcerated.

Information about your spouse or common-law partner

Enter the amounts that are, or would be, reported on your spouse’s or common-law partner’s return. For the net income, enter the amount that is, or would be, reported on line 236 of that return, even if it is zero.

Note

Your spouse or common-law partner may still have to file a return for 2018, even if you enter this amount on page 1 of your return.

Residency information for tax administration agreements (page 1 of your return)

In some provinces and territories, you are also required to identify whether or not you resided on the settlement lands of an Aboriginal government on December 31, 2018.

These Aboriginal governments are:

  • Nisga’a Lisims Government (in British Columbia)
  • Nunatsiavut Government (in Newfoundland and Labrador)
  • Tåîchô Government and Délı̨nę Got’ı̨nę Government (in the Northwest Territories)
  • eleven self-governing Yukon First Nations

Individuals who resided on the settlement lands of an Aboriginal government in Yukon, the Northwest Territories, and British Columbia may also have to respond to another question in this section of the return, identifying if they are a citizen or member of one of these Aboriginal governments.

Your response to these questions will not impact the amount of tax you pay; however, it will ensure that the Aboriginal government receives the correct tax revenue in accordance with its personal income tax administration agreement. For more information, go to Information on the tax exemption under section 87 of the Indian Act.

Elections Canada (page 1 of your return)

Ticking the “Yes” boxes in the Elections Canada section is an easy way to keep your voter registration up to date, if you are eligible to vote.

Elections Canada will use the information you provide to update the National Register of Electors (the Register), the database of Canadian citizens eligible to vote in federal elections and referendums. Elections Canada uses the information in the Register to prepare voters lists for federal elections and referendums, and to communicate with voters. Other uses of the information permitted under the Canada Elections Act include providing voter information to provincial and territorial election agencies for uses permitted under their respective legislations, and providing voter information (not including birth dates) to members of Parliament, registered political parties and candidates at election time.

Only persons who have Canadian citizenship and are 18 years of age or older are eligible to vote. Generally, you are a Canadian citizen either by birth or if you have obtained Canadian citizenship through the formal process of becoming a Canadian citizen (naturalization). If you are unsure about your Canadian citizenship status, refer to the Immigration, Refugees and Citizenship Canada website at See if you may be a citizen.

These questions are optional. You will not lose your right to vote, regardless of whether you answer the questions or leave them blank. The CRA does not use this information for the purpose of processing your return.

If you have Canadian citizenship and authorize the CRA to share your name, address, date of birth, and Canadian citizenship status with Elections Canada, tick “Yes” to both questions. If you do not authorize the CRA to share your information with Elections Canada, tick “No” to question B.

If you do not have Canadian citizenship, tick “No” to question A and leave question B blank.

If during the year you change your mind about the CRA sharing your information with Elections Canada, call the CRA at 1-800-959-8281 to remove your authorization. To be removed from the Register, contact Elections Canada.

If you tick “No” to question B

  • The CRA will not give any of your information to Elections Canada
  • Elections Canada will not remove your information from the Register or from voters lists, if your name is already there
  • If there is an election or referendum and you are not already registered with Elections Canada, you will have to register before you vote

Deceased persons

Do not complete this section for a deceased person. If you are completing a return for a deceased person who consented to provide information to Elections Canada on their last return, the CRA will notify Elections Canada to remove the deceased person’s name from the Register.
For more information, visit elections.ca or call 1-800-463-6868. Teletypewriter users can call 1-800-361-8935.

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