GST credit

Reasons to file a tax return even if you don’t have to pay taxes

April 20, 2017

By Sheryl Smolkin

Because you were not employed in 2016 or you earned less than the basic personal deduction ($15,843 in Saskatchewan) you may not be worried about meeting the May 1st income tax deadline. But there are many good reasons to file a tax return even if you don’t have any income to report. For example:

  1. Get a refund: If you worked for some period of time and your employer deducted income taxes you actually didn’t have to pay it is the only way to get a refund.
  2. TFSA contribution room: It is the easiest way to establish contribution room for a Tax-Free Savings Account although contribution room is not affected by taxable income.
  3. Earned income for RRSP purposes.  Even if you do not wish to contribute to an RRSP currently, “earned income” amounts can be carried forward indefinitely. For RRSP purposes, earned income includes net employment income, net rental income from real property, CPP/QPP disability benefits and taxable alimony received.
  4. Refundable tax credits: There are some federal and provincial refundable tax credits that may be payable to you even if you have no earnings and paid no tax. For example, see the federal Working Income Tax Benefit.
  5. GST/HST credit: Generally, Canadian residents age 19 or older are eligible to receive the federal GST/HST credit, which is paid quarterly to eligible recipients.  Those under 19 may be eligible, if they have (or previously had) a spouse or common-law partner, or if they are a parent and they reside with their child.
  6. Canada child benefit payments: You or your spouse or common-law partner want to begin or continue receiving Canada child benefit payments, including related provincial or territorial benefit payments.
  7. Non-capital loss: You have incurred a non-capital loss (see line 236) in 2016 that you want to be able to apply in other years.
  8. Education credits: You want to carry forward or transfer the unused part of your tuition, education, and textbook amounts. See line 323.
  9. GIS: You receive the guaranteed income supplement or allowance benefits under the old age security program. You can usually renew your benefit by filing your return by April 30.  However, if you choose not to file a return, you will have to complete a renewal form. This form is available from Service Canada,
  10. Provincial benefits: You want to be eligible, or continue to be eligible, for provincial benefit programs.  See the Government Programs, Benefits and Services information for your province.

Also consider having your children file a tax return reporting income from various types of part-time work (paper route, baby-sitting, lawn mowing, etc.), even if they do not have to pay income tax, so they can create their own RRSP contribution room.