Debunking 8 common tax myths and misunderstandings (part 1)

Countering bad tax advice is crucial

It’s getting to be that time of the year again— Tax Day is approaching and you start hearing conflicting things from friends and family about what is—and what isn’t—okay when filing your taxes. There’s a lot of misinformation out there about various deductions, loopholes, and write-offs that can get you into hot water if you blindly follow someone else’s bad advice.

We’ve all heard people saying the rich don’t pay taxes, and the government is robbing us, or horror stories of being taxed at over 50% once your income is more than $100,000. Social media has amplified the problem, spreading myths as fast as truth and making it difficult to know what’s fact and fiction. Add in recent changes in the tax laws and you are left feeling confused and unsure of where to go for the right answers.

Countering bad advice, especially during tax season, is crucial. So we reached out to expert and tax specialist Réginald Pierre-Louis to bust several tax myths and give you the facts to help ensure that you file accurate returns.  His expertise can help ensure that you receive money the government owes you and avoid penalties for underreporting.

In this episode, Marcelo and Réginald break down common tax mistakes and misconceptions, explore why these tax myths are so widespread, and share the facts you need to know as a Canadian investor.

Thank you for listening!

8 Common Tax Myths

• Réginald’s extensive background as a tax specialist (1:21)
• Réginald’s passion for teaching and what sparked his interest in tax (3:00)
• Myth #1: If we’re not living together, we’re not common-law partners (5:44)
• Myth #2: I have no income, so I don’t need to file taxes (9:39)
• Myth #3: My accountant is no good – I had to pay taxes (10:54)
• It’s your responsibility to share all relevant information with your accountant (14:04)
• Myth #4: I make above $100,000/year, so my tax rate will be 50% (16:41)
• Myth #5: I won’t accept this salary increase or work overtime since my tax is more than the salary increase (23:07)
• Examples of situations which might lead to an unexpectedly large tax bill at the end of the year (29:00)
• Myth #6: I work at a bar/restaurant. Aren’t tips tax-free? (32:17)
• Myth #7: RSPs are useless because future withdrawals are taxed (35:46)
• The emotional and psychological aspects of finance (43:39)
• Myth #8: Québec is the most taxed place in Canada (47:47)

Mentioned in this Episode:

• Réginald Pierre-Louis  on LinkedIn
• L’investisseur transformé
• Épisode 18: Mythes et croyances populaires en fiscalité (partie 1)
• Épisode 19: Mythes et croyances populaires en fiscalité (partie 2)
• Revenu Québec Guidance | Employees Who Receive Tips
• Tulett, Matthews & Associates
• Keith Matthews’ Book | The Empowered Investor: A Guide to Building Better Portfolios