How to Fill Out a Personal Tax Return: Step-by-Step

Whether this is your first time filing or you’re a newcomer to Canada, this clear, step-by-step guide will walk you through completing your tax return.

Most Canadians file electronically using tax software. According to the Canada Revenue Agency (CRA), 92% of taxpayers filed online in 2022. You can still use a paper return and mail it to the CRA, but processing takes longer. Below are the practical steps to prepare and file an accurate return.

Part 1: Collect all the documents you need

Before you begin, gather your personal information and tax documents: Social Insurance Number (SIN), all T slips (T4, T5, T3, etc.), receipts for deductions and credits, and details for any dependents you claim. Newcomers should also have their date of entry documented.

Log into the CRA’s My Account and your financial institution portals to make sure you’ve received every slip. Keep supporting documents—receipts for medical expenses, childcare, moving costs, tuition, and charitable donations—in a physical or digital folder, since the CRA may request proof of claims.

Part 2: Choose to file online or by paper copy

Filing with CRA-certified Netfile software automates calculations and often helps identify eligible deductions and credits. Software comes in free and paid versions; CRA publishes a yearly list of certified providers. Note: you cannot use older versions of software to file the current year’s return.

If you prefer paper, the CRA mail package is sent to previous filers, or you can print forms from the CRA website, order forms, or call the CRA at 1-855-330-3305. Be sure to use the provincial form that matches your province of residence on December 31 of the tax year.

Part 3: Decide whether to do it yourself or hire a professional

If your taxes are straightforward—employment income, standard deductions, no rental properties or complex investments—you can likely complete your return with software. For complicated situations (business sales, multiple properties, significant investments, disability claims, retirement decisions such as delaying OAS or taking CPP early) professional advice from a qualified accountant or tax advisor can be worthwhile.

If you hire a preparer or use a free tax clinic, review the completed return before it’s submitted. Confirm all personal details, income figures, and claimed deductions are correct. You remain responsible for your return, and the CRA may request documentation later. If an error occurs, you can file an adjustment.

Part 4: Fill out your tax return

Using tax software guides you through each section and often offers a questionnaire to identify credits and deductions you may qualify for. Read each section carefully to ensure you don’t miss new credits—this year’s example is the multigenerational home renovation tax credit for households building secondary units.

If filing on paper, double- and triple-check all calculations. One incorrect number can affect many entries.

Download the Income Tax and Benefit Return if you want to follow along with the form while reading these steps.

Step 1: Identification and other information

Identification

Provide your mailing address, email, SIN, date of birth and marital status. Newcomers record their date of entry; emigrants record their date of departure.

Residence

Report the province or territory where you lived on December 31 of the tax year—this determines your provincial tax rates and applicable provincial credits.

Spouse or common-law partner

Include your partner’s information and net income so calculations for spousal amounts, benefits or repayment can be completed accurately.

Elections Canada

Canadian citizens can authorize the CRA to share their contact details with Elections Canada to update voter rolls.

Indian Act exempt income

If you received income exempt under the Indian Act, complete Form T90 so benefits calculations and refundable credits are recorded correctly.

Climate action incentive payment

If you live outside listed areas, check the box to claim the correct climate action incentive payment amount.

Foreign property

If you owned foreign property worth more than $100,000 CAD during the year, you must file Form T1135 by the tax filing deadline (for example, April 30, 2024).

Consent to share contact information and donor registry (Ontario)

Ontario residents can authorize the CRA to share name and email with Ontario Health to receive information from the Trillium Gift of Life program about organ and tissue donation.

Step 2: Total income

You’ll enter amounts on numbered lines and boxes. Employment income from T4 slips goes on line 1 (box 10100). Then add other sources such as:

• Employment Insurance and other benefits (T4E)
• Pensions, public and private
• Dividends and investment income (T5, T3, T5013)
• Capital gains or losses
• RRSP withdrawals
• Scholarships, fellowships, bursaries and artists’ grants (T4A box 105)

Self-employment income

Report income and expenses from any business or side hustle. Keep receipts to claim expenses and report net income, which is generally subject to CPP contributions. Business losses can offset other income. Note the new anti-flipping rules: profit on the sale of a principal residence sold within one year may be treated as business income unless an exception applies—consult Guide T4002 or a tax professional.

Step 3: Net income

From total income, subtract allowable deductions to arrive at net income. Common deductions include:

• Pension contributions (T4A)
• RRSP contributions
• Union or professional dues
• Childcare expenses (Form T778)
• Moving expenses (Form T1-M)
• Employment expenses (see Guide T4044)

Income-tested benefits like EI or OAS can be subject to repayment (“clawback”) if your income exceeds thresholds. Complete the Federal Worksheet if required.

Step 4: Taxable income

After net income, apply additional deductions such as northern residents’ deductions, capital loss carryforwards, or capital gains deductions for qualifying small business disposals to calculate taxable income.

Step 5: Federal tax

Calculate net federal tax in three parts:

Part A: Federal tax on taxable income

Apply the federal tax brackets and formulas to your taxable income to determine the base federal tax.

Part B: Federal non-refundable tax credits

Reduce federal tax with non-refundable credits such as:

• Basic personal amount
• Age amount
• Spousal and dependent amounts
• CPP/QPP and EI contributions
• Home buyers’ or home accessibility credits
• Tuition (Schedule 11), medical expenses, and donations (Schedule 9)

Part C: Net federal tax

Apply less common credits and carryforwards here, such as the dividend tax credit, minimum tax carryforwards, and political contribution credits. Record any advance Canada Workers Benefit received by lower-income earners.

Step 6: Refund or balance owing

This section aggregates taxes payable, credits, and amounts already withheld. Self-employed taxpayers should add CPP and EI premiums payable. Include social benefits repayment amounts, provincial taxes, and refundable provincial credits.

At the top of the final page of the T1 General, report tax already deducted, any instalments made, and eligible rebates and credits (CPP/EI overpayments, Canada Workers Benefit, Canada Training Credit, educator supply credit, etc.). If credits exceed taxes payable, you’ll receive a refund; otherwise a balance owing will be shown.

Pay any amount owing online via banking, credit card or pre-authorized debit. Refund timelines: electronic filers typically receive refunds within two weeks, paper filers within eight weeks, and non-resident filers may wait longer. Sign up for direct deposit for the fastest delivery.

If you’re uncertain about any entry, consult a qualified accountant or tax professional. Tax software helps catch many errors, but it cannot replace professional advice for complex situations or audit representation.

Step 7: Review your Notice of Assessment (NOA)

After filing electronically, you can usually receive a Notice of Assessment within two weeks; paper returns can take up to eight weeks. Filing online through Netfile-certified software and registering for CRA My Account may give you an immediate “express NOA.” Review your NOA carefully for any adjustments or follow-up from the CRA.

Reap the rewards of filing your tax return

Filing your return can result in a refund and ensures you remain eligible for government benefits. After your first complete filing, the process becomes easier each year as you keep records and become familiar with applicable deductions and credits. Filing electronically is generally the fastest and most convenient option.

Read more about personal income taxes in Canada:

• How to file your taxes online in Canada
• Can you file multiple years of income taxes together in Canada?
• How to avoid tax on severance pay in Canada
• How to build a tax-efficient retirement income plan