Everything you need to know about the T1

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The T1 taxpayer's form is also known as the Income Tax and Benefit Return. Here is an overview of everything Canadians need to know about the T1 form, including who should fill it out, where to get it, and its various sections.

What Is a T1 Form?

The T1 form is a summary of all income taxes you pay to the CRA. All Canadians are required to fill and submit this form, which also declares all income you have generated for the specified calendar year. Think of the T1 as a kind of summary of all the other forms you complete for your income taxes, as well as all the information required to file. 

You need the T1 form to apply for various services like the Canada Child benefit, GST/HST refundable tax credits, and other benefits. You may also be required to provide the T1 general income form when applying for major credits, such as a mortgage.

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Who Should Fill Out a T1?

Every Canadian has to file a T1 every year. Business owners, such as sole proprietors and partnerships, are also required to complete the T1 business form. However, if you are a corporation, you should complete the T2 which is provided for corporate income.

How Do I Get a T1 Online?

There are various places to get a copy of the CRA T1 form. The easiest way to get your T1 is online. 

If you have a CRA My Account, you can find your T1 for the current year, as well as the past 11 years that you filed, by looking under the “tax returns view” section. If you look for anything older, you will need to contact the CRA directly at 1-800-959-8281 to request a copy.

You can also conveniently complete your T1 tax returns through tax preparers and certified tax calculators like SimpleTax. These tax forms are named after the calendar years they are required for, so you should use the 2020 T1 form to report personal income for the 2020 tax year.

How to Calculate Income?

There are three main parts to calculating your taxable income for the T1 form. These include:

  • Gross Income/Revenue

    The gross income refers to the sum of all wages, salaries, profits, interest payments, rents, and other forms of earnings, before any deductions or taxes.

  • Net Income/Revenue

    Once you have the gross income, you should subtract the cost of goods sold, as well as any expenses, depreciation and amortization, interest, and taxes, to find your net income, also known as your profit. For instance, if your free-range walnut milk business generated $150,000 in 2019, but your production costs and taxes amounted to $100,000, then your net income will be $50,000 ($150,000 - $100,000).

  • Taxable Income

    The last step involves subtracting other allowable expenses from your net income. The CRA allows you to deduct various expenses, including rent, utility bills, the business use of a car, and other amounts. Travel expenses, bonuses offered to employees, and other costs of running your business are generally considered allowed expenses you can subtract from your net income, pending taxation. The final amount you’re left with represents your taxable income.

T1 Breakdown

The T1 general income tax isn't as elaborate as others. It also uses entries from other taxpayer forms and has five main parts to fill. These include:

SectionMeaning
IdentificationIn this section, you provide details such as your name, address, social insurance number, and marital status. If you have a business, you will be required to fill the business identification section. Taxpayers with multiple businesses must fill a separate T2125 form.
Total IncomeHere you declare all your income sources, including income from employment, self-employment, foreign income, disability benefits, and more. This is also known as your gross income.
Net IncomeThis is the amount you're left with after expenses are subtracted from the total income. You can deduct various allowable expenses from your total income, so you should check for the ones you are allowed to remove from the taxable income on the CRA site.
Taxable IncomeThe CRA allows you to subtract other amounts, such as capital losses, from your net income. The taxable income refers to the final amount you get after all allowed deductions have been made. It is the income CRA will tax using existing rates for the calendar year.
Refund or Balance OwingThis section is where you determine if you are eligible to get some money back or required to pay more. A positive number in this section implies you owe CRA money while a negative number means you will receive a refund.

Where Do I Send My T1?

The easiest way is to complete the T1 form submission online through services like SimpleTax. Online form submission is facilitated using NETFILE, the CRA-recommended service for submitting CRA-issued taxpayer forms. You can also download the PDF form, fill and mail it to CRA offices in your province.

When to Submit and Pay for T1

Canadian taxpayers are required to file the T1 by April 30. T1 submissions follow the general calendar year. If you want to file the T1 for the 2020 tax year, you have until April 30, 2021, to submit the income statement.

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Last Updated January 11, 2021

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