With tax returns due for filing in April just a friendly reminder on the documents to keep at tax time. Delays on approval for mortgage applications in most cases occur for the same reason, lack of documents for mortgage approval.
For those who are paid hourly or with fluctuating hours each pay period or on commission, the lenders need to see 2 years of income with your T1 General tax returns and/or Notice of Assessments (NOA). The NOA is the piece of paper you get back from Canada Revenue Agency after you filed your tax return. The NOA confirms your income as filed, if taxes are owed and your RRSP contribution level. You would receive this by mail within a few weeks after filing your tax return.
Documents to keep at tax time
In many cases after tax season, we as tax payers will file away the T1 General tax return with the T4 and when the NOA comes in the mail it goes in a drawer somewhere. Many people don’t keep all their tax information in a file so when they need the documents for mortgage approval it can be a challenge to locate them. Or you need to contact the accountant or CRA to obtain the most current tax filing or NOA.
Remember documents to keep at tax time include your T4 (from your employer), your T1 General tax return (provided by your accountant) and the NOA (from CRA after filing). Keep them for at least 7 consecutive years in the event of a CRA audit.
When in doubt of what documents you need for your income from employment, business for self-employment or rental income, consult with your mortgage broker.
To learn more about getting ready to file your 2013 tax return visit http://www.cra-arc.gc.ca/getready/