If you’ve recently decided to immigrate to Canada or you’ve just arrived, adapting to a new country is a big milestone. Getting to grips with taxes in Canada is one of the first important responsibilities you’ll encounter. This guide is here to help you confidently file your taxes during your first year as a Canadian resident, and to make your interactions with the Canada Revenue Agency (CRA) as straightforward as possible.

From organizing paperwork to choosing how to file, we’ll walk you through the essentials. Let’s begin your tax journey in the Great White North with clarity and confidence.

Understanding Canada’s Tax System

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Canada uses a progressive income tax system. This means the more income you earn, the higher the rate of tax you pay. This tax structure helps fund vital government services like healthcare, education, and infrastructure. The Canada Revenue Agency is the main government body responsible for collecting taxes and delivering benefit programs across the country.

Should You File a Tax Return as a Newcomer to Canada?

As a newcomer to Canada, you may still need to file a tax return—even if you only lived in the country for part of the year. Here are some common reasons why filing a return is necessary:

  • You Owe Tax: If you earned income in Canada and owe taxes, filing ensures you meet your legal obligations.
  • You’re Eligible for a Refund: If you had income tax deducted from your pay, you might be owed a refund. Filing your return allows you to claim it.
  • You Want to Access Benefits: Some government credits and benefits—like the GST/HST credit—require you to file a return, even if you had no income.

Free Help with Filing Taxes

For newcomers with low to modest incomes, there are free tax clinics available:

  • Community Volunteer Income Tax Program (CVITP): Volunteers help eligible individuals complete and file their taxes free of charge.
  • Volunteer Tax Assistance in Quebec: A similar program designed for residents of Quebec who need help with income tax preparation.

Support for the Self-Employed

If you’re self-employed, the CRA offers a Liaison Officer Service to help you understand your tax responsibilities, from what records to keep to how and when to file.

Who Qualifies as a Newcomer to Canada?

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The term “newcomer to Canada” covers various immigration statuses, including:

  • Permanent Residents: Those who have received official confirmation of permanent resident status from IRCC, including individuals approved in principle.
  • Refugees: Individuals recognized as protected persons fall into this group.
  • Temporary Residents: This includes international students, temporary foreign workers, and individuals with temporary resident permits.

Canadian Residency for Tax Purposes

Tax residency is different from immigration status. For tax purposes, you're considered a resident once you establish significant residential ties in Canada. This usually happens once you arrive and start settling in.

If you're uncertain about your residency status, you can submit CRA Form NR74, “Determination of Residency Status (Entering Canada),” before filing your return. This form allows the CRA to assess your situation and provide an official decision. You can also consult CRA’s Income Tax Folio S5-F1-C1 for detailed guidance.

Having Residential Ties in Canada

The CRA uses residential ties to determine if you’re a Canadian resident for tax purposes. These ties fall into two categories.

Primary Ties:

  • Housing in Canada: Owning or renting a home in Canada is a strong indicator of residency.
  • Family in Canada: If your spouse, partner, or children live with you in Canada, it strengthens your residential status.

Secondary Ties:

  • Personal Property: Having personal belongings like a car or household items in Canada shows intent to stay.
  • Community Involvement: Membership in local clubs or organizations shows integration into Canadian society.
  • Financial Ties: Canadian bank accounts, credit cards, or investments indicate economic connection.
  • Official Documents: Holding a Canadian driver's license, health card, or passport also supports your tax residency claim.

Note that no single factor determines your status. The CRA evaluates your overall circumstances when assessing residency.

Your Canadian Social Insurance Number (SIN)

Every newcomer to Canada must obtain a Canadian Social Insurance Number (SIN). This nine-digit number is essential for identifying you for income tax and benefits purposes. Keep it secure and only share it when legally required.

Why Is a SIN Important?

The CRA uses your SIN to track your income and eligibility for tax benefits. You must provide your SIN on any tax documents, including your T4 slip (statement of employment income).

Do You Need a New SIN?

If you're transitioning from temporary to permanent residency, and you previously used a:

  • SIN starting with “9”
  • Temporary Tax Number (TTN)
  • Individual Tax Number (ITN)

Then you must apply for a new permanent SIN from Service Canada. Once received, discontinue using any temporary numbers.

How to Apply for a SIN

There are three ways to apply:

  • Online: Submit your application through the official Service Canada website with digital copies of your documents.
  • In Person: Visit a Service Canada office with the required documents.
  • By Mail: You can also mail in your application.

Choosing the Right Tax Package

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The Canada Revenue Agency provides tax packages that are customized by province or territory. These packages help ensure that you file your taxes correctly based on where you live as of December 31 of the tax year.

What’s in a Tax Package?

A tax package includes several key resources:

  • Federal Information: A guide to tax rules and credits that apply across Canada.
  • Provincial/Territorial Details: Information specific to your region, including local tax rates and benefits.
  • Income Tax Forms: The necessary forms to complete your T1 Income Tax and Benefit Return.
  • Filing Instructions: Step-by-step directions to help you file correctly and claim eligible credits.

Why It Matters

Choosing the right tax package is of great importance. Here’s why:

  • Accurate Tax Calculations: Provinces have different tax rates. Using the right package ensures your return is accurate.
  • Claiming Benefits: Certain provincial tax credits and deductions are only available if you use the correct forms.

Filing Your Tax Return: Online or Paper?

There are two primary ways to file your taxes in Canada: electronically or on paper.

Electronic Filing

Electronic options are secure and can speed up processing:

  • NETFILE: Allows you to file directly with the CRA using certified tax software or web apps - many of which are free.
  • EFILE: A service used by authorized tax professionals to file returns on your behalf.

Paper Filing

If you prefer a traditional approach, you can complete your return by hand and mail it to the CRA. Make sure to send it to the correct tax centre to avoid delays.

FAQs

When is the Deadline to File my Taxes in Canada for 2025?

The deadline for most individuals to file their income tax and benefit return for the 2024 tax year is April 30, 2025. This is also the last day to pay any taxes you owe. Filing and paying on time helps you avoid late-filing penalties and interest charges from the Canada Revenue Agency.

What Benefits Might I Receive After Filing?

Filing your return can make you eligible for several benefits and credit programs. These include:

  • GST/HST Credit: A quarterly payment that offsets some of the taxes you pay on goods and services.
  • Canada Carbon Rebate: A payment for individuals in provinces affected by federal carbon pricing.
  • Canada Child Benefit: Monthly payments to support families raising children under 18.

You must remember to file every year to continue receiving these benefits, even if you had little or no income.