Kevin Greenard: Financial and tax due date calendar for 2021

Throughout every calendar year, there are set financial tasks and tax due dates that are important to remember. Below, we have compiled a calendar of the key dates that you need to know as the New Year approaches.

First Quarter (January 1 – March 31)

January 1: New TFSA contribution room.

Additional room is added to everyone’s TFSA each year on January 1. For 2021, the TFSA new contribution limit is $6,000. For anyone who took money out of their TFSAs in 2020, you’re in luck because you are now able to recontribute those funds. As well, if you have not contributed in past years, you still have that contribution room available in addition to the 2021 contribution room.

January 20: Canada Child Benefit and Universal Child Care Benefit.

Families with children under the age of 18 may receive the Canada Child Benefit (CCB) and eligible families with children under the age of six may receive the Universal Child Care Benefit (UCCB). These are usually paid around the 20th of each month. With these cash inflows, we recommend to parents of younger children to fund their children’s Registered Education Savings Plans (RESPs) to ensure they receive the maximum Canada Education Savings Grant (CESG) amount.

January 27: Canada Pension Plan (CPP) and Old Age Security (OAS) payment dates.

CPP and OAS payments are automatically deposited into your bank account. Your first payment of 2021 will be electronically transferred on January 27, 2021.

January 30: Deadline to pay interest on a family loan.

For those who have family loans, this is not a deadline to miss. Ensure that you have paid interest at the documented interest rate in order to avoid income attribution.

February 19: Canada Child Benefit and Universal Child Care Benefit.

February 24: Canada Pension Plan (CPP) and Old Age Security (OAS) payment dates.

March 1: Deadline to issue T4s, T4As, and T5s.

Employers and financial institutions have until the last day of February to issue their T4, T4A and T5 slips and file their annual information returns. This year, February 28 falls on a Sunday, so CRA will accept slips filed on Monday, March 1, 2021 as being on time.

If you haven’t received your T4, T4A or T5 by mid-March, consider following-up with your financial institution. Or, if you’ve received it and misplaced it, contact your financial institution to receive an electronic copy.

March 1: Deadline to contribute to an RRSP.

Individuals can contribute to their RRSP within the first 60 days of the calendar year and claim the related RRSP deduction on the previous year’s tax return. For 2021, taxpayers have until March 1 (first 60 days of 2021) to contribute to their RRSP and take advantage of lowering their taxes. Repayments to an RRSP for the Home Buyers’ Plan and Lifelong Learning Plan must also be made into the RRSP within the first 60 days in order to avoid penalties.

March 15: First quarterly personal tax instalment is due.

Check those CRA notices to determine what your first quarter’s installments are for CRA. Take care to make this payment because installment interest penalties can be hefty. Installment interest is charged at the prescribed rate, and it is compounded daily. As well, if your installment interest is more than $1,000 in the year, you’ll receive additional penalties.

March 19: Canada Child Benefit and Universal Child Care Benefit.

March 29: Canada Pension Plan (CPP) and Old Age Security (OAS) payment dates.

March 31: Deadline to file NR4s and T3 trust returns.

If your trust’s year-end is December 31, 2020, you have until March 31 (90 days after the trust’s year-end) to file the T3 return, the related T3 slips, NR4 slips, and T3 and NR4 summaries.

Second Quarter (April 1 – June 30)

April 15: Deadline to file U.S. individual income tax returns for 2020 or 6-month extension requests.

The deadline to file income taxes with the IRS is April 15. If you are a U.S. citizen residing elsewhere (such as Canada), you receive an automatic 2-month extension to file your taxes, as long as you don’t have any withholding tax. If you don’t have any withholding taxes, this shifts the deadline to June 15, and no penalties on late taxes will begin until this date.

April 15: Deadline to file 2020 report of foreign Bank and Financial Accounts, FinCEN report 114 (formerly FBAR), for U.S. citizens living in Canada.

If you’re a U.S. citizen living abroad and have a financial interest in one or more financial accounts worth $10,000 or more, you’re required to file this report with the IRS.

April 20: Canada Child Benefit and Universal Child Care Benefit.

April 28: Canada Pension Plan (CPP) and Old Age Security (OAS) payment dates.

April 30: Deadline to file personal income tax returns for 2020 where the taxpayer or taxpayer’s spouse/common-law partner does not have self-employed business income.

April 30 is the due date for the majority of Canadians to file their income tax returns with the CRA. This is a key date not to miss because there are large penalties associated with filing late if you owe taxes. If you owe taxes for the year, and do not pay the balance owing by April 30, you will be charged five per cent of the balance owing, plus one per cent of the balance owing each month thereafter, to a maximum of 12 months.

May 20: Canada Child Benefit and Universal Child Care Benefit.

May 27: Canada Pension Plan (CPP) and Old Age Security (OAS) payment dates.

June 15: Second quarterly personal tax instalment is due.

Similar to the March 15 installments due above – it is strongly recommended to make your tax installment payments on time to avoid compounding interest charges.

June 15: Deadline to file personal income tax returns for 2020 where the taxpayer or taxpayer’s spouse/common-law partner has self-employed business income.

If you have self-employment income, you have an additional six weeks to complete your income tax return. After June 15, the same penalties will apply, so make sure your income taxes are filed by this date.

For business owners, not only do they have to keep track of the deadline to file their personal income tax return, and other key personal dates, but they also need to keep track of dates relating to their business. These may include corporate tax deadlines, instalment payments due, GST remittances, provincial sales tax, payroll, tax slip remittances, corporate bill payments and insurance, to name a few.

June 15: Deadline to file GST returns for self-employed individuals with a December 31 year-end.

If you’re self-employed, your personal income taxes are due on this date, and so is your GST return – it’s a perfect time to complete and file them together.

June 15: Deadline to file 2020 U.S. individual income tax returns for U.S. citizens or resident aliens residing abroad and U.S. non-residents with no withholding tax.

As mentioned above, if you have no withholding taxes, you can use the automatic two-month extension and file your U.S. income taxes by June 15.

June 18: Canada Child Benefit and Universal Child Care Benefit.

June 28: Canada Pension Plan (CPP) and Old Age Security (OAS) payment dates.

Third Quarter (July 1 – September 30)

It is summertime and naturally things are quiet in the third quarter – even the CRA needs a vacation. There is only one deadline, but a couple of other key dates to note:

July 20: Canada Child Benefit and Universal Child Care Benefit.

July 28: Canada Pension Plan (CPP) and Old Age Security (OAS) payment dates.

August 20: Canada Child Benefit and Universal Child Care Benefit.

August 27: Canada Pension Plan (CPP) and Old Age Security (OAS) payment dates.

September 15: Third quarter personal tax instalment is due.

By now, you will have received your CRA notice of assessment and your installment payments will have been adjusted accordingly. Make sure you update your payments accordingly to the new amount to avoid any interest charges.

September 20: Canada Child Benefit and Universal Child Care Benefit.

September 28: Canada Pension Plan (CPP) and Old Age Security (OAS) payment dates.

Fourth Quarter (October 1 – December 31)

October 20: Canada Child Benefit and Universal Child Care Benefit.

October 27: Canada Pension Plan (CPP) and Old Age Security (OAS) payment dates.

November 19: Canada Child Benefit and Universal Child Care Benefit.

November 26: Canada Pension Plan (CPP) and Old Age Security (OAS) payment dates.

December 13: Canada Child Benefit and Universal Child Care Benefit.

December 15: Fourth quarter personal tax instalment is due.

This is the fourth and final installment payment of the year – you’ve made it this far, don’t stop now and make this installment payment on time!

December 22: Canada Pension Plan (CPP) and Old Age Security (OAS) payment dates.

December 29: Last day to settle trades in calendar year 2021 for Canadian and U.S. tax-loss selling.

If you have realized capital gains in 2021 and are looking to offset some of these with some losses, December 29, 2021 is your last chance.

December 31: Contribution deadline for Registered Education Savings Plans (RESP).

If you have Canada Education Savings Grant (CESG) money sitting on the table because you haven’t maximized the 2021 RESP contribution for your children or grandchildren, it’s time to act fast and make that contribution.

December 31: Deadline to make charitable donations to be claimed for the 2021 tax year.

If you’re looking to make some charitable donations and claim the associated donation tax credits on your 2021 tax return, today’s the last day to donate.

Change in CRA deadlines

Under unusual circumstances, the CRA has the ability to amend their due dates. For one example, the personal income tax filing deadline was deferred from April 30, 2020 to June 1, 2020 in this current year due to COVID-19. We encourage everyone to keep an eye on these deadlines throughout the year in case this has happened.

Important reminders

- The 2021 TFSA limit is $6,000.

- The maximum 2020 RRSP limit is $27,230. You still have the first 60 days of 2021 to make contributions that can be applied to your 2020 tax return.

- For 2021, the RRSP limit has increased to $27,830. For people who know their 2021 RRSP limits already, why not make the contribution as early as possible and benefit from compounding growth.

It is also important to note that if any of the above deadlines fall on a Saturday, Sunday or a holiday, taxpayers have until the next business day to file.

The stock market is not open all year round. There are holiday closures both in Canada and the United States. With a stock market closure, you will be unable to buy and sell securities on these days, and settlement times may be affected. Here is a list of Canada and U.S. stock market closures for 2021:

** The Canadian Bond Markets close at 10 a.m. PT (1 p.m. ET) before each of the above listed holidays.

** The U.S. Bond Markets close at 11 a.m. PT (2 p.m. ET) the day before the above noted holidays.

The standard trading day is from 9:30 a.m. ET (6:30 a.m. PT) to 4 p.m. (1 p.m. PT). Before certain holidays, the fixed income markets and some stock markets may close early. If you have important trades to make, it’s always recommended to check the listing of both full and early market closures.

For 2021, there is one day where the NASDAQ and the NYSE close at 10 a.m. PT (1 p.m. ET) which is as follows:

Personalized deadline profile

I think you will agree that there are a lot of dates and deadlines to remember each year. When you factor in other personalized dates such as maturing GICs, insurance premiums, car insurance, annual car maintenance, property taxes, phone, internet and cable bills, heat and hot water bills, etc., it can be hard to keep track of them all.

We recommend setting up reminders on your phone or computer to alert you to these coming deadlines. Set these reminders not just on the day they are due, but also a reminder a week or a month in advance to ensure adequate time to pay, file, plan, or make a change. This can greatly simplify your personal due dates and make sure you never miss one again.

Full service

Our comprehensive team approach enables us to manage many of these payments for our clients. We can make quarterly CRA installments and insurance premium payments on behalf of our clients. In addition, we can proactively fund our clients’ TFSAs and RRSPs early in the year.

Other items to note

Many employers will pay their employees via direct deposit. We suggest marking these dates on your personalized calendar so you can check your bank account balance and make any applicable bill payments and transfers at that time.

If you have a Pre-Authorized Contribution (PAC) set up from your chequing account to your investment or savings accounts, we also suggest marking this date in your calendar in case you need to transfer any funds between your bank accounts before the PAC occurs.

It is also worth paying annually, if it’s financially feasible at the time. Not only can it help streamline your monthly personal due dates, but it can be cheaper to pay annually as well. For example, life insurance premiums when paid annually are often at an eight per cent discount. Car insurance also receives a discount, albeit smaller.

If you don’t have the money up front to pay annually, then we encourage individuals to automate as many of their household payments as possible, including credit cards, mortgage payments, monthly utility bills etc.

You’ll perhaps have noticed in the above article that I didn’t mention the word “budget” once. By staying on top of these deadlines, they can be integrated into your budget. As well, by diarizing these important deadlines, it can even help your budget – you won’t be caught off guard with forgotten expenses, or unplanned interest and penalties.

Here’s to a smooth and well-planned 2021.

Kevin Greenard CPA CA FMA CFP CIM is a Portfolio Manager and Director, Wealth Management with The Greenard Group at Scotia Wealth Management in Victoria. His column appears every week in the TC. Call 250-389-2138. greenardgroup.com