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TAXED?!?!?!? or NOT TAXED?!?!?!?

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Post by bosn181 on Wed 20 Mar 2019, 22:14

i been trying to get my taxes sorted out for 11 years now and i am sure one of these years i will get a refund instead of having to try and fix it year after year. joy's of having it paid to you from 4 different places.

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Post by eodtech on Wed 20 Mar 2019, 19:00

That's great info. I talked to CRA again this morning, and they assure me that when I DID increase my CF pension federal income tax contribution, that overrid the need to have Manulife take taxes off. No matter where the taxes are taken from, I'm finally paying enough now to 0 out by the end of each year. And just for S&G's...I called Manulife and they confirmed what you've written here. Yes....they don't remove federal income tax UNLESS YOU SPECIFICALLY fill out a form REQUESTING...that they remove taxes. Oh well...six and one half...because I just used the value Manulife WOULD HAVE taxed me...and had that amount increased to be taken off my CF pension. So, in the end, they get their money. Apparently, everything is copacetic. We'll see; for the 2019 return next Feb/Mar.

I was all over the map yesterday WRT the horrible incompetence of how things are so inefficient in the civvy world. Living under the CF umbrella for so long...is a perfect example of your own complacency. Every thing is done for you. Pay, medical appts, EXCHANGING AND RETURNING THINGS w/o hassle (compared to civvy street), etc. Once you leave the gate for the last time...it's like a bucket of ice cold water dumped on you every day. Feeble excuses everywhere. "I don't know".  I hardly ever knew that statement. The answer wasn't "I don't know". The answer was and is..."I'll find out and get back to you." Civvies in the service industry just look at you with a blank face...with something like..."What do you want ME to do about it?" "I don't know how that works/how to do that." Unbelieveable.

I'm not saying this because I think I'm smarter or better than anyone else...it's just a shocker when you've never been in the civvy "system" and you go from relatively smooth flowing daily routine...to a brick wall in a nanosecond. 4 years and I'm still wondering....

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Post by Nemo on Wed 20 Mar 2019, 17:19

I am am 100% agreement Propat... It is whatever method you feel comfortable using.
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Post by propat on Wed 20 Mar 2019, 15:39

yes buds a few ways out there to do it the best way is as always the most comfortable way for the individual . don't get me wrong I fully believe in paying taxes at the rate we pay. Im just using the best way for me that's all . depending on the year I can pay anywhere from 5 to 15 grand at years end and I gotta tell ya even with having the money in hand the act of handing over that kind of cash really hurts . when I worked I did it monthly maybe got a refund and although I knew exactly how much taxes I paid but it never really registered . IT REGESTERS NOW lol.

but I think its I good thing . if everybody were forced to pay it in one shot for just one year I bet you a lot of people would be shocked and voter participation would hit the high 90 percentile range .

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Post by Nemo on Wed 20 Mar 2019, 13:01

Yeah, that's good too Propat. Key is is that you are preparing to pay them and then when you have to when you file, you have the funds set aside. No big surprises. That is also why I like to pay my town taxes, vehicle and house insurance monthly taken direct out of my account. Less painful by the month as opposed to coming up with 5K at one time.
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Post by propat on Wed 20 Mar 2019, 11:40

ya nemo gives a really post on the matter here that should be acceptable to most . I go a slightly different route ive implemented for many years . figure my taxes owed at years end and divide by 12 . monthly I deposit that amount into an account I use for investments for the sole purpose of paying taxes . the profit from this covers the small penalties and taxable investment income and leaves me with an additional amount that varies from year to year and a few years have left pretty good chunks .I leave the extra there and don't figure it in to my next years calcs . this year I hope to have twice the amount I need to pay my tax just through the accumulations and interest from the years of extra amounts .

I hope i live long enough to have the annual interest on these accumulations be enough to cover my taxes so I will not need to add to it monthly . I could get there faster via TFSA but its more fiscally prudent I use that for other investments .

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Post by Nemo on Wed 20 Mar 2019, 09:51

I think the rule with CRA and taxes (and yes SISIP is all taxable) is that if you have more than 3k taxes owing when filing, then you have to do installment payments UNLESS you know that you won't be paying 3K plus when you file next time. You only have to fill out a simple form TD1 and submit it to whichever souce you want to take more taxes out. So if you know that you normally pay another 3k (or whatever amount it is) when you file, fill out that tax form TD1 to take more taxes off. Ideally you should be within a couple hundred dollars and not thousands when you file your taxes. My spouse gets a bit of taxes back and I pay a bit but we end up getting about $500 back so that's just about right considering some years we might have less in medical expenses to claim. It took my two years to fine tune it when spouse finally retired. And Manulife will take whatever tax you want off SISIP payments as it is taxable. I did send in an updated TD1 to SISIP the year after it was increased as I then paid a lot of taxes on filing. But all sorted out now.

And one other thing I have found helpful is estimating taxes using a free software like studiotax. You can input your income and deductions during the year and get an idea what you might owe at the end...or maybe get back. But remember 3K is the key for owing taxes when you file. If you owe 3K plus then you must do installment payments or you will be penalized by paying a penalty.

So best thing is to fill out that TD1 and get enough taxes taken off so that you are within a couple hundred dollars negative or positive for a refund or payment on filing. The taxes have to be paid and it feels less painful getting them taken out every month as opposed to paying a big chunk when you file.
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Post by Guest on Wed 20 Mar 2019, 04:39

I also understand this frustrating situation. I have a suggestion. Log in CRA account and make installments or extra "one time tax" payment. I did it monthly from June until December in 2018. I am not computer savvy and its really easy and takes me about 30 seconds.

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Post by eodtech on Tue 19 Mar 2019, 22:44

Complete arseholes!!!! Evil or Very Mad Evil or Very Mad Evil or Very Mad Evil or Very Mad Evil or Very Mad Evil or Very Mad Evil or Very Mad Evil or Very Mad Evil or Very Mad Evil or Very Mad

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Post by Whodunit on Tue 19 Mar 2019, 19:34

Eod - I'm in the same boat... Since I release, I've averaged 5k in taxes yearly - can't say the mfr's haven't done well off me. And I've always paid it in full. But, CRA sent me letters (multiple times over the years) telling me I had to pay by installments. So I never did because I always paid in full, AFTER, my taxes were completed so I would know exactly how much I owed. Well, funny enough, the mfr's tax the installment payment if you don't pay it... ex: pay x amount in march, june, september - but I didn't. So for not paying in March - you get taxed on the amount (they decide you owe), then if you didn't pay in June, you get taxed on that amount as well and same for Sep. In the end you pay tax 3 times over for not paying on the dates they decide for the amounts they decide. When I contacted CRA they told me it's in the tax law and there's nothing you can do. So hows that for BS!! And yes, same here, never had to pay while serving and have done nothing but pay since release...
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Post by eodtech on Tue 19 Mar 2019, 18:45

All of us are former military. It is totally inconceivable to me...how even departments w/in the gov't....i.e. CF Pension office (who had royally screwed my deposit one month*) can't GTST WRT deposits, the amounts, timing etc! In my entire 36 years in the military...never ONCE did I not receive my pay in full and on the scheduled payday. And I was taxed at the appropriate rate every year. So that, if I didn't 0 out at the end of the year...I was refunded a token amount. Never ONCE did I owe CRA any money while I served. As soon as I retired...everything went to shit...and I'm still trying to sort it out. Why can't these entities GTST??? They're given all the info they need when someone retires. I've never had to be a civvie...AND DO OTHERS PEOPLES LEG WORK FOR THEM until now. I had heard competency levels on civvy street were bad...but I never expected what I still see after 4 years retired. I shook my head on day 1...and still haven't stopped being bewildered by the way civvies do things. Such gross inefficiency and incompetence. And when it comes at the cost of what little disposable income I have if someone says...*"oh well...our people are only human...you should see your deposit within 10-14 days..." 10-14 days?!?!?!? What the F am supposed to tell my creditors?!?!?!? YOU f'd up my deposit...and I now have to BEG them to wait for payment because of YOUR mistake?!?!?!?

So again...a tirade. But...I'm wondering if any of you guys out there have experienced similar mind-boggling incompetence. Am I an exclusion to an otherwise "smooth-running" system....or....is this systemic and people are "just putting up w/it"?

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Post by bigrex on Tue 19 Mar 2019, 17:05

Yes, the problem with getting income, from several different sources, is that each one is likely taxed at the lower rates, because each one alone, is less than a certain amount. But once you add all of the sources together, it suddenly bumps you up into a higher tax bracket, for your over all income.

CPP - $12000/ yr x 15% tax = $1800
CF pension  - $18000/yr x 15% tax = $2700
ELB/CIA/CIAS - $63000 x 22% = $14000

So you've paid $18500 in taxes.

But if the taxes on your total income of $93000 are 26%, taxes owed would be over $24000. These are not actual numbers, or anywhere close to actual figures, but just an example of how that in the end, you could still end up owing taxes, even if SISIP is taxed.
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Post by eodtech on Tue 19 Mar 2019, 16:20

Thanks everyone. Thanks for listening to my rant. Instead of going to my tax preparer...F**K IT! I just got off the phone wCRA. Who told me in no uncertain terms that absof**kin'LUTELY...it is taxable income. And if Manulife is either not taking taxes off...or not taking ENOUGH tax off...YOU....the individual (after going thru all the security bullshit) must "authorize" them to either increase the tax amount...or start taxing period. To which they also said..."either way...EVEN THOUGH....you've increased your Mil Pension tax contribution...you would/will STILL end up owing us." So, obviously, my next call tomorrow will be to Manulife to BEGIN taking off income tax...and the correct amount. To stop these 'harassing' CRA Amount Owing statements.

Thanks for all yer help. There is no doubt now. Only took 4 years. Lol.

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Post by Newfiegal on Tue 19 Mar 2019, 15:33

eodtech. Yes it is TAXABLE. I have receive LTD (Sisip) since 2005 and I have taxed deducted every month. No they don’t deduct enough mine you. Maybe you are below tax line from what you receive from manulife to pay taxes on it. One option if you can do is if you have a spouse you could start a spousal RSP and you get tax break instead of paying CRA. That’s what hubby and I had to do

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Post by bigrex on Tue 19 Mar 2019, 15:01

It is supposed to be a taxable benefit. Anybody who was part of the SISIP lawsuit will attest to that, because we ended up losing several thousand dollars, or more, from our settlements, for taxes. And then we were penalized, during tax time, for not paying the taxes on the retroactive payments, back when we were supposed to get it.
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