Bank of Canada governor Mark Carney believes this new comfort with high debt is caused by an “illusion of affordability” where inflated home values paired with bottomed-out interest rates give a false impression you can manage your money even if you’re living beyond your means. The trouble is in a highly uncertain economy home values could fall, which in turn would cause mortgage rates to rise. As a result Canadians would see their debt-to-income ratio increase without even spending a dime.

This uncertain market therefore makes it essential to manage your money in a smarter way to reduce your personal debt-to-income ratio as much as possible. While you can’t do anything about home values falling, you can decrease your non-mortgage or unsecured debt in order to improve your financial standing. Consider the current debt-to-income ratio average in Canada is still over 150 per cent. This means the average Canadian spends about $1.50 for every $1.00 they earn. This upside down budget strategy will only put your finances into a tailspin.

To start improving your own personal debt-to-income ratio, the key is to take an assessment of how much debt you have. You specifically want to look first at unsecured debts, such as your credit cards. While it’s important to pay your mortgage on time to keep your home, paying extra will not actually improve your budget each month because your mortgage works on a fixed payment schedule. On the other hand, credit card payments decrease as you pay your debt off, so you receive a benefit in reducing your total debt, but you also see a benefit now by freeing up more money in your monthly budget.

This brings us to the second point in decreasing your debt-to-income ratio—you need to have an accurate monthly budget in place in order to be financially successful. You may think you can keep everything straight in your head, however creating a budget by listing every expense allows you to see the hard numbers for where your money is actually going. This helps you to identify areas where you can cut back to find more money to pay off debt. In turn, paying off a credit card frees up money in your budget, so you have more to work with as you pay your debts down. This allows you to build momentum to get your finances where they need to be.

If you assess your debts and create a budget, but you can’t see any way to make the numbers work, don’t wait to get help. Contact a credit counselling agency to discuss your situation. A trained credit counsellor can help assess your situation and provide options to help you find a way to move forward. Even better, many credit counselling agencies are not-for-profit, so you can get the advice and discuss your options without adding another bill you have to pay back.

Connie Solidad has been writing about finances and debt consolidation for years. She’s an expert in the industry and writes about debt management and credit counseling options and resources. When Connie is not working, she loves playing with her two dogs in Tampa, Florida. To learn more about debt management refer to ConsolidatedCredit.ca.

Three Big Tools for Small Business

1. For those in the creative industries, media files can take up a lot of space on your PC. “Google Play” offers the perfect cloud solution to this. As a media storage system it’s one of the more recent entrants to the market place, but it should prove essential for media professionals and businesses. It allows you to access the files from any device connected to the Internet so you can free up space on your PC, Mac or laptop and still have the files available for clients whenever you need them.
2. For those who rely on documents for business “Drop Box” provides an excellent solution. This cloud computing system allows you to store your documents securely online – which means that they can be available whenever and wherever you need them. The system also allows for file sharing between co-workers, and this means that documents can be worked on by co-workers and that amendments are available to all users. Leaving that important paperwork in the office will become a thing of the past!
3. Software that allows you to do accounting online is an absolute must for businesses of any size. It can be especially useful to the smallest of businesses. As with IT, most of us are not accounting experts and online accounting systems take much of the strain when it comes to preparing accounts and invoices. It can also reduce software conflicts with your accountant and your records can be made available to them online – saving time, resources and money for both parties.

Home Time

This very brief selection of cloud computing tools is only the tip of this particular iceberg. While there are many others that may be very useful to individual business sectors, media, document and accounting cloud computing software are the most significant for the majority. The key advantages to all of these products is that they reduce time spent on maintaining software, you are no longer reliant on the health, or otherwise, of a single computer, and they reduce software conflicts between co-workers and other professionals. The smallest businesses are likely to be those who gain the most benefits from cloud computing as it reduces the need to be a big IT expert and stores your data safely and securely in the event of computer disasters. Until now these have been challenges that only large firms could easily manage and were out of the reach of those running small firms or working alone. The fact that access to work or documents is via the Internet can also allow you much greater freedom – meaning less trips back to the office at the end of the day to catch up on paperwork and the chance to make it home before the kids have gone to bed!

Simon Wilson is a freelance writer and blogs about business, entrepreneurs and technology covering everything from QuickBooks Online Essentials to social media management tools. He loves reading great entrepreneurs biographies and speaking at conferences about how the Internet can help small businesses.

1. Remove the seal on every envelope that hold your tax and financial documents (mortgage, interest, dividends) and put them back into the envelope for your accountant. This is bound to bother the accountant and they would like to empty the contents of all the envelopes before disposing the torn wrapping, themselves.
2. Taking an appointment from in advance so as to allow your accountant to be well prepared is significant. In order to infuriate your accountant, call him/her at the nick of time and demand an immediate appointment. This insistence, like many others would definitely be based on some prior commitments due to which an earlier slot was not asked for. In addition to this, expect that the accountant will oblige you and be ready with all the documentation.
3. Another way of being successful in causing your accountant a sufficient amount of displeasure is by reaching his/her office with all your very important papers over stuffed and disorganized in a shoebox or a large envelope. Hence, the accountant will have to initially settle all the documents in a structured way before handling your finances. This might just act as a breath of fresh air in the otherwise, mundane job.
4. There are some papers which are vital for the maintenance of your assets. Ensure that you forget some of these documents. When you meet your accountant, formulate a record of the items you forgot to include in your filing, and having left the office, conveniently lost the list. Make contact with the accountant to learn the entries on the list. Subsequent to receiving this information, send these papers through email or fax, but do so one by one on multiple numbers of days. Make certain that you do not assemble them and send them in an orderly fashion.
5. Email, text or call your accountant as often as possible while he/she is in the middle of preparing and classifying your documents to ask whether he/she is ready with it or not. Bore it in your mind that he/she has no plans of getting in touch after they are done filing and hence, it is your duty to retrieve knowledge with regards to the ongoing process. Therefore, make sure that you contact him/her through mails or phone calls to be informed when they are through with your work. You can also leave really time-consuming voicemails which are absolutely out of context and believe that your accountant will like this disruption and unnecessarily long intrusive communication.

Margaret is a blogger by profession. She loves writing on diyhealth and cellphonebeat. Beside this she is fond of books. She recently did an article on acute renal failure. These days she is busy in writing an article on HTC Incredible S review.

Doing one thing at a time

You may believe that you perform best when you pay undivided attention to a specific task at any given time. Tackling multiple activities at once might not be your cup of tea. You may think that tax filing deserves your undivided attention and it’s not worth hurrying up and it might take a back seat as compared to other items in your list.

Interest and Boredom

Interest and boredom lies in the things people engage in doing. Like other works including shopping online, booking holidays and tickets and paying bills, people find filing tax a boring job. Also, numbers are boring for many people and they try to avoid playing with numbers. Since, tax filing is very calculative; they wait until last minute to make their mind to pay taxes as they do not find any other option (It is compulsory to pay).

A laid back attitude

Some individuals do not rush around anything in their life whether going for a party or filing taxes. Folks could also be too occupied at their workplace to file taxes. They have a relaxed attitude rather than a frantic attitude. But do not compare them with the folks who have a lazy attitude because such personalities never get the things done. A laid back attitude is a stress free attitude. A person could feel stress by looking at the tax forms and filing procedures, though technology has made things easier today and one can opt to file taxes online.

An individual tends to shift the mindset to concentrate on what makes one self-happy than on what makes the other person happy or what someone else expects. Since the income tax department is liberal enough to give sufficient time to file taxes, people tend to opt for the last few days to file returns. An individual’s income tax documents may prove to be too intricate to file them in advance. One can choose to file taxes online or with help of a Professional Accountant if need be, for an early declaration.

Margaret is a blogger by profession. She loves writing on environment and automotto. She recently did an article on Tata Venture. These days she is busy in writing an article on most expensive watch.

The Canadian Revenue Agency (CRA) and Canadian government officials worry that some citizens will take these myths to heart; they worry that citizens might listen to the rumors and follow only part of the tax code, or avoid paying their taxes all together. I’d like to explain some of the myths behind parts of the Canadian tax code so citizens can feel more informed.

Belief: I can refuse to pay my federal income taxes because of its questionable constitutionality

This is perhaps the most widely circulated myth regarding federal income taxes. Some people incorrectly believe that the federal government does not have the explicit power to levy taxes on an individual, but those powers are specifically described in the Section 91 of the Canadian Constitution. There is a question of whether provincial governments or the federal government can impose direct taxation on a citizen, but the answer is that both can do so. There is no question that the federal government is within its constitutional rights to impose an income tax.

Belief: Canada’s income tax system is based on a citizen’s voluntary compliance because the laws are really unconstitutional

While it’s true that the tax system is based on voluntary compliance, that doesn’t mean that you can voluntarily stop paying your taxes. And the voluntary compliance is certainly not due to the law’s unconstitutionality—the tax laws are constitutional. The government assumes that its citizens will comply with all the necessary tax regulations, but make no mistake: the government assumes that you will pay your taxes if you have taxes to pay. If you do avoid your taxes, provisions outlined in the Income Tax Act (1985) give the government the authority to penalize you. So pay your taxes when they’re due!

Belief: I haven’t filed a tax return in years

Every once in a while you’ll hear some person say that they’ve avoided paying their taxes this year for such and such reason. They might claim that the government “doesn’t really care” if you miss paying your taxes, or they’ll say that the government lacks the resources to track people who evade their taxes. Again, this is just a myth. The Canadian government is fully equipped to deal with perpetrators who go out of their way to avoid or make fraudulent claims with their taxes. Again, the Income Tax Act gives the government the power to punish citizens who knowingly avoid or make fraudulent claims about their taxes. In short: don’t cheat your taxes, it’s not worth it.

Belief: You can negotiate your taxes with the CRA

This claim is just ridiculous. Levels and percentages of taxation are determined by Parliament and regional legislators. Once these government officials pass a law regarding the amount of a tax, that amount is declared law. No legitimate figure within the CRA will allow a citizen to manipulate the rates and numbers of their personal taxes just to save some money. If you know anyone who has done such a thing, then they are committing a criminal offense and subject to severe penalties.

Mariana Ashley is a freelance writer who particularly enjoys writing about online colleges. She loves receiving reader feedback, which can be directed to mariana.ashley031@gmail.com.

Find Out Who Went to Prison for Not Paying Taxes

The truth is that although many celebrities owe the government money these days, only a few of them will be prosecuted and send to prison for tax evasion. We all remember that about two years ago, Paul Hogan, also known as “Crocodile Dundee,” was leading the top of debtors, being forced to pay government the amount of $150,000,000. The second position was occupied by Halsey Minor, with a debt of $14,120,479. The third position was taken by Chris Tucker, with an owed amount of $11,500,000. And the top continues with many other renowned celebrities. None of these artists went to jail. However, there were a few unlucky celebrities, such as:

• Wesley Snipes: He was incarcerated in December 2010 for not paying his taxes for 1999, 2000, and 2001. The actor pleaded innocent, stating that he was duped by his tax advisers. However, the court denied his appeal, putting him in jail for tax evasion.
• Richard Hatch: Richard Hatch, the former winner of the television show, “Survivor,” went to prison for nine months for not paying the taxes on the prize he got. He even made a public plea, hoping that his action could help him to raise money and repay his debt.
• Joe Francis: This actor tried to cheat the IRS with $20,000,000. This “strategy” cost him a full year in prison for fraudulent deductions.

It seems that we can apply the expression “nothing is certain but death and taxes” in all these situations. Although only the aforementioned celebrities went to prison for not paying their taxes, many more are still swimming in hot waters. Some of these celebrities are Nicholas Cage, Pamela Anderson, Martha Steward, Marc Anthony, Sinbad, Willie Nelson, Darryl Strawberry, Boris Becker, Sean Connery, Richard Hatch, Jamie Presley, and many others. All these people are in a “tax situation” – this is how they call tax evasion. However, in most cases, their only fault is the fact that they allow their tax advisers to handle different tasks without checking them. At the end, they pay for their negligence.

Celebrities and Their Tax Problems

Year after year, the tabloids highlight the names of numerous celebrities, who face different tax problems. The people, who encounter such problems, will definitely have run-ins with the authorities. Obviously, the smart people pay their debts and clean their names as soon as possible. However, others prefer to deny their debts and even go to jail in order to defend their position. Unfortunately, some people are victims of different mistakes that tax authorities make.

This is because, in our money-driven world, “Uncle Sam” has the last world. “He” does not care how many Grammys, Emmys, or Oscars an artist has. “He” only knows one thing, namely that the artist must pay the taxes. Therefore, even though many people do not agree with this position, the reality shows us that regardless of how respected and loved some actors are, they must pay the taxes on time if they want to win “Uncle Sam’s” admiration and respect.

Currently, many people are in jail for different tax-related charges. In most cases, the government is interested in getting restitution, which means integral payments that include penalties and interest rates. In order to get money, the government is ready to seize assets and any future profits. If the debtor is going to pay off the required amount, he or she can avoid prosecution and jail. Therefore, going to jail for not paying taxes is definitely possible. However, it is essential to bear in mind that this action is usually reserved only for those individuals who do not want to pay. This is because the act of not paying taxes is considered criminal, entailing prosecution and prison.

This is a guest post by David Veibl, occasional guest blogger on health issues, business, SEO, sports and technology. David now writes for Wallace & Associates. WallaceAPC is a boutique-style CPA tax accountant firm located in Encino, CA. They provide a wide variety of tax return preparation, accounting, and planning services. Their expertise in both US and international taxation issues, paired with advanced business and taxation degrees our staff possesses, makes them an invaluable resource.

The following smart phone apps get my pick as top Canadian tax apps for 2012:

1. Go! Tax Canada (Free for iPhone)

Your tax return is nothing to stress about in 2011. Luckily for Canadians there is Go! Tax Canada, a completely free app that will help you fill out your tax return correctly, and file it quickly and conveniently! This app was actually designed by income tax specialists, so you know you are in good hands when you follow the advice of an accredited Canada Revenue Agent. Use Go! Tax Canada to fill out your tax forms correctly, take photos of all forms so you can retain the original documents for your personal files, ask a revenue agent questions via info@gotaxcanada.ca, file your tax return securely at a low cost, and even deliver a complete summary of your tax return to your email account after your finished. Filing taxes was never so easy!

2. Canadian Sales Tax Lite (Free for Android)

For tax time and every day use, the Canadian Sales Tax app is an HST (with combines the GST and Provincial sales tax) calculator that applies to shopping in Ontario, Montreal, Calgary, Newfoundland, British Columbia, and every other Canadian province. Currently the Canadian Sales Tax Lite app has been rolled out in English only, with the Calculatrice TVQ app better-utilized by French speakers.

3. Canadian Tax Man (Free for iPhone)

The Canadian Tax Man will be in your pocket, literally, no bribes or begging necessary, when you download this app! The Canadian Tax Man app is an income tax calculator with a simple, user-friendly interface. Key in your numbers to quickly estimate your total annual income for 2011 or to keep a running tally all year long to ensure you don’t pay in to the real tax man at year’s end. You can also use this app to deduct any charitable donations. Right now, this app is available for all provinces and territories within Canada except for Quebec.

4. H&R Block Mobile App (Free for Android)

The experts at H&R Block, the popular global tax filers, have outdone themselves by introducing their H&R Block Mobile Tax app exclusively for Canadians. This app provides tax advice, a tax preparation check list, a list of e-file reminder dates, a tax glossary of hundreds of alphabetized terms so you can translate all of those hundred-letter tax terms, a tax refund estimate, an H&R Block office locator that uses GPS to find the closest location to your home, plus quick answers to the most frequently asked questions (FAQs) by Canadian tax payers.

Bio: Jane Johnson is a writer for GoingCellular, a popular site that provides cell phone related news, commentary, reviews on popular providers like T-Mobile.

The following 5 apps will take the sting out of your rear end after Uncle Sam has had his way with you—helping you complete the tally on both simple and complex tax filings, figure in how your personal and business expenses, answer any last-minute questions you might have concerning tax deductibles like donations, and even digitally file your tax return for you! Won’t it be nice for once to be prepared for this year’s tax man?

1. H&R Block Tax Answers (Free – for iPhone)

For the majority of us filing taxes, we need more than just a simple W-2 tax form. The tax experts at H&R Block offer free tax guidance for your more complicated financial questions thanks to the H&R Block Tax Answers app. This app will help you tally your earnings, your tax exemptions (for things like charity donations and educational expenses), and answer all of your tax queries within 24 hours time. Plus, the app features a handy FAQ section with predefined categories (such as work earnings, education, small business questions, and etc) so you can search and see if your question has already been answered. It also features a handy tax glossary, which lists definitions of the most common financial terms that accountant types throw around willy-nilly, but regular folk like you and I can’t understand.

2. Tax Book (Free – for Android)

Oftentimes tax season is so overwhelming when you look at all of that paperwork and all of those receipts that you just don’t bother to file your tax deductibles for the sake of your sanity. The Tax Book app is here to help you out. So instead of sorting through all of those receipts come tax time, the app lets you manually record tax-deductible expenses as they occur and keeps a running tally. It also lets you categorize expenses (i.e., gas mileage, charity donations, home renovations, education, etc.) then uses the data (with your yearly earnings) to estimate your tax payment.

3. TaxCaster (Free – for iPhone)

Want quick-and-dirty tax calculation of how much you are going to have to pay? Or how much you can expect as a tax return? TaxCaster does just that in, oh about, five minutes. Just because you don’t have your W-2 in front of you, the TaxCaster app can predict a range of exceptions—such as your estimated earnings and expenses (like education, family deductibles, rent, and small business tax deductibles).

4. IRS2Go (Free – for iPhone and Android)

Who better to have as an ally in your tax preparation than the IRS? I bet you didn’t know that the tax man has a smart phone app that provides video, news updates, and answers to tax questions that help you file your taxes the right time, the first time. IRS2Go puts you in direct contact with the IRS using your mobile device, so you are up-to-date on all the latest public tax cuts, new government tax legislation, and all the tax tools you’ll need to keep the IRS happy. You can also check the status of your refund or request a transcript of your tax via your smart phone within a few days.

5. TurboTax SnapTax ($9.99 – for iPhone and Android)

The SnapTax app brilliantly and automatically completes tax forms using a standard W-2 for those of us who are less than mathematically inclined. Just follow these easy steps:

1. Upload your W-2
2. Let the app automatically ask you questions about tax deductibles (education, kids, medical expenses, etc.)
3. III. Let TurboTax file your tax refund

So try SnapTax for less than it costs to file your taxes at the mall kiosk or by using most other types of tax preparation software.

Bio: Jane Johnson is a writer for GoingCellular, a popular site that provides cell phone related news, commentary, reviews on popular providers like T-Mobile.

Replacing things like releve-4 and other credits, this new credit is decided through family income and is given to those who do not even owe any income tax. Knowing where you stand with what you owe (or are owed) can be tough, and this will probably make a big difference to that so it is imperative to know what it means.

What is it replacing?

• The QST credit
• The credit for individuals living in northern villages
• The property tax refund

By streamlining three credits into one, everyone is able to save both time and money.

How Quebec solidarity tax credit works

Paid monthly, this new system can be claimed by residents of Quebec who have legal status and are aged 18 or above. This is a pretty standard system for tax, and the government is hoping that this tax credit will:

• Benefit 200,000 more households in Quebec than the three previous credits – meaning that 2.7 million families can be helped.
• Protect the buying power for medium or low income households.
• Earn the average household around $42 each month – or around $500 a year.

How do you get your credit payments?

As stated above, there are certain hoops that need to be cleared to be allowed payment, but once that is done all you need to do is a direct deposit registration. This can be done through the online service that offers a simple registration package. Alternatively, you can send a VOID blank cheque to Revenu Quebec that shows your social insurance number and name or completing a form and handing it in at the offices.

Once you are ready to get your payments, then sit tight and wait for the credit that will start hitting accounts this July – ending in June 2013.

With the Quebec solidarity tax credit meaning that every household can look forward to extra income this year, it is important to know how to work other taxes in your favour. By using a website like Rate Supermarket you can find top tips on reducing taxation and increasing savings, but there are plenty of simple things to consider.

• Any income you earn in a registered retirement savings plan (RRSP) is exempt from tax as long as the funds remain in the plan. RRSPs help you save for your retirement and get a break at tax time too.
• As long as you stay within your contribution room limit, you will not pay tax on any income you earn from investments in your tax-free savings account.
• Does someone in your family regularly take the bus, train, subway, or ferry to work? You may be able to get a non-refundable tax credit for the cost of the transit passes by claiming the public transit amount.
• Have you retired and now receive a pension? You can split up to 50% of eligible pension income with your spouse or common-law partner to reduce the overall taxes you pay. See pension income splitting for more information.
• Do you work in the trades? Tradespeople can deduct part of the cost of eligible tools purchased throughout the year.
• Did you buy your first home in 2011? Check out the home buyers’ amount to see if you qualify.
• Are you a single parent receiving the Universal Child Care Benefit (UCCB)? The Government of Canada released new UCCB measures may allow you to designate the UCCB income in your child’s name instead of adding this amount to your income.
• Medical expenses: You may be able to claim a non-refundable tax credit based on the medical expenses paid for any 12-month period ending in 2011.
• Child care expenses: Did your children attend daycare or another program such as a summer day camp in 2011? You may be able to claim the amounts you spent on eligible childcare in 2011.

Source: Canada Revenue Agency