Tax Season for Therapists - Owl Practice Blog

Tax Season for Therapists

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With tax season coming up quickly, are you ready?

Doing your taxes—both your personal taxes and those of your private practice—can make for a stressful time. Maybe it’s being presented with a deadline, worrying about money, or just having to do “math”, but most people find doing their taxes to be an overwhelming experience.

The key to getting your taxes done quickly and efficiently is organization. If you have all relevant documents, invoices, bills, and financial information at the ready, doing your taxes is not much more than plugging numbers into a program. The trick, of course, is having all of that information prepped and ready to go. Here’s where Owl Practice can be super useful for those who want to streamline their tax season experience!

Have Your Due Dates Front-of-Mind

No one likes to be presented with a deadline, but if you don’t get your taxes submitted and paid by a specific date, you could be facing significant penalties.

Here are the upcoming important dates for your personal 2020 income taxes:

April 30: Tax filing deadline.

June 15: Tax filing deadline if you are self-employed.

April 30: Tax payment deadline.

Yes, you read that right. If you are self-employed, you’ll need to pay your taxes before the deadline to file your taxes. If you own your private practice and are technically self-employed, this is vital to keep in mind.

Forget About the Shoebox

It’s astounding how many people still keep all of their financial information, including bills, receipts, invoices, and T4 slips, in a shoebox.

With just a tiny bit more organization, you can reduce your tax prep from hours to minutes! A big part of that is using Owl Practice’s invoicing and billing tools. Rather than needing to dig through paper copies of everything, you can find all of your invoices in your Owl Practice account. Our system keeps track of balances owing, paid invoices, and many other financial documents. If you’re a fan of having paper copies, you can just print them off!

Even better, thanks to our regular backups, you can rest assured that you’ll never lose any essential documents. Like everything else in your account, we keep multiple secure backups on our dedicated Canadian servers.

The Impact of COVID-19 on Your Taxes

The pandemic has undoubtedly complicated things for everyone, especially when it comes to finances.

By introducing various new tax credits and several emergency benefits, municipal, provincial, and federal governments across Canada have been helping folks get through the pandemic. Unfortunately, these benefits and credits will serve to complicate your taxes.

There are two things that you should be aware of:

  1. If you moved into a home office at the beginning of the pandemic—and still work there—you likely qualify for a home office tax credit. You could potentially write off a percentage of your utilities, supplies, and other necessary things you needed to work from home. To learn more, we highly recommend contacting a professional accountant.
  1. If you applied for CERB back in 2020, you should know that taxes were not withheld on payments. That means that taxes will be deducted when you are preparing your income tax returns. With this in mind, don’t be surprised to see a little less money than you would otherwise expect.

Hire Someone to Help

The best way to reduce or eliminate potential stress from doing your taxes is to hire a professional to do them for you. If you’re a busy therapist, the time and energy this strategy can save you are more than worth the cost of the accountant. In fact, the accountant might even be able to find you some savings that could more than pay for their professional services!

Unfortunately, time is rapidly running out. If you want to find a qualified accountant to handle your personal income taxes—and perhaps the taxes of your private practice as well—we recommend doing it soon.

Thankfully, if you use Owl Practice, your accountant should have all important documents right at their fingertips, minimizing the time it will take them to complete your taxes on time!

With the passing of the pandemic’s first anniversary, many people across the country are feeling more strained than ever. Doing your taxes ASAP can help reduce your stress levels and get you a little ahead of the game. And Owl Practice is right here to help you along the way with our robust invoicing and billing features!

If you’d like to learn more about everything Owl Practice has to offer, you can sign up for a 14-day free trial! If you have any questions or comments about our services, please contact us at support@owlpractice.ca.

As Always,

Practice Wisely

 

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