Do Newcomers Need to File an Income Tax Return?

It’s smart to file an income tax return in Canada if you arrived in 2024. If you became a permanent resident and lived in Canada, even for a short period, filing your first income tax return with the Canada Revenue Agency (CRA) can provide financial benefits. If you didn’t earn income in Canada in 2024, filing a return allows you to apply for important benefits like the Goods and Services Tax (GST) Credit, and Harmonized Sales Tax (HST) Credit, or Canada Child Benefit (CCB) you may be eligible for without you filing a tax return. In other words, you will have to file an income tax return if you:

• Want to get benefits and credit payments

• Want to claim a refund

• Have to pay taxes in Canada. 

While filing taxes in Canada for the first time may seem overwhelming, there are resources to help you (see the section below: Government of Canada Income Tax Resources). Many settlement agencies can help you complete your taxes for the first time. This is just one of many important services that settlement agencies provide.

As we approach the “tax season” in Canada and the deadline to file your income tax return, this information will help you get started.

Understanding Canada’s Tax System  

Navigating the Canadian tax system will make your life here much easier. If you’re already employed, you know that a good portion of your earnings goes to taxes, maybe more than what you were used to in your native country. 

The taxes you pay come back to you through helpful public services and many gratuities making Canada one of the most sought-after destinations for immigrants. In addition, you can recover part of your taxes and access tax credits when you file an income tax return each year.

What are Tax Credits?

Tax credits are sums that are deducted from the total taxes you owe. You may be eligible for one or more tax credits. When you claim deductions, you may receive a larger refund or reduce the taxes that you owe. Here are some tax credits and deductions that you may be eligible for:

• Child care expenses deduction

• Canada caregiver credit

• Education and textbook tax credits

• Disability tax credit

• Canada Carbon Rebate is available to residents of Alberta, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, Prince Edward Island, and Saskatchewan to offset the cost of federal pollution pricing. Currently, this credit is unavailable in British Columbia, Northwest Territories, Nunavut, Quebec, or Yukon.

When you claim certain tax credits, you must support your claim with receipts.

What Benefits Can I Receive?

When you file your income tax return, you can apply for benefits. These benefits are payments for specific expenses that can help make living in Canada more affordable. Some examples of benefits include:

• Goods and Service Tax (GST) and Harmonized Sales Tax (HST) credit: helps individuals and families with low or modest incomes to offset sales tax.

• Canada child tax benefit: a tax-free payment that helps families with the cost of raising children under 18.

• Provincial & territorial benefits & credits.

Here are some benefits you may be eligible for:

BENEFIT	MARRIED OR COMMON-LAW WITH CHILDREN	MARRIED OR COMMON-LAW WITH NO CHILDREN	SINGLE WITH CHILDREN	SINGLE AND 19 OR OLDER WITH NO CHILDREN
Canada Child Benefit	Yes	No	Yes	No
GST/HST Benefit	Yes	Yes	Yes	Yes
Provincial & Territorial Benefits & Credits	Yes	Yes	Yes	Yes

Arrive in Canada Financially Prepared

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When is the Deadline to File an Income Tax Return for 2025?

The deadline to file your 2024 income tax return in Canada is on or before Wednesday, April 30, 2025. If you owe taxes, you must pay the full amount on or before April 30, 2025. If you are self-employed, the deadline to file your income tax return is June 15, 2025. But if you owe taxes, you still have to pay by April 30, 2025.

If you owe money and do not pay by April 30, you will have to pay daily interest on the amount you owe. Penalties and interest can add up so it’s best to pay the full amount to avoid paying late fees.

Important Tax Changes for 2025

Income tax and benefit amounts will change to offset some of the rising living costs. These changes put additional money in your pocket. Some of the important tax changes for 2025 include:

• The dollar limit for the Registered Retirement Savings Plan (RRSP) will increase from $31,560 to 32,490 (with a limit of 18% of your 2023 earned income).

• The dollar limit for the Tax-free Savings Account (TFSA) will remain at $7,000 after two consecutive years of increases. It’s important to use a TFSA as an investment and not as a savings account.

• An increase to the Basic Personal Amount (BPA) you can earn without paying federal tax will range from $14,539 to $16,129 depending on your income.

• Tax bracket changes: all five federal income tax brackets have been adjusted by 2.7% to help Canadians maintain buying power as the cost of goods increases:

FEDERAL TAX RATE FOR 2025	TAXABLE INCOME THRESHOLD
15% on the portion of taxable income that is:	Less than $57,375 or less, plus
20.5% on the portion of taxable income that is:	Over $55,375 up to $114,750 plus
26% on the portion of taxable income that is:	Over $114,750 up to $177,882 plus
29% on the portion of taxable income that is:	Over $177,882 up to $253,414 plus
33% on the portion taxable income that is:	Over $253,414

How to File Your Income Tax Return

You can file your income tax return for 2024 online in two ways: 

EFILE	NETFILE
– EFILE is a secure CRA service that lets authorized service providers complete and file your return electronically.	– This electronic tax-filing service lets you do your personal income tax and benefit return online using certified tax preparation software and submit it directly to the CRA.

You can also complete your income tax and benefit return by paper. Click here to get a 2024 T1 (personal) income tax package. Be sure to order the package for the province that you reside because the tax system can vary by province.

Use Free Certified Online Tax Software to Simplify the Process:

Here are some free tax software products that you can use. These are great if you have a simple tax return to file:  

Wealthsimple Tax	TurboTax	CloudTax
– Free autofill tax software allows you to complete a simple tax return – Provides a helpful guide to claiming deductions – Offers paid plans for different tax needs.	– Offers free & paid tax returns – Free tax return service applies to simple tax returns but does not include income, credits, and deductions such as:  – Employment expenses (meals, lodging, etc) – Donations -Medical expenses – Investment income and expenses – Rental property income and expenses – Self-employed income and expenses.	– Free and paid services – Offers free ‘how-to’ videos and a step-by-step guided application.

Find Free Tax Clinics:

You may be eligible to use the Community Volunteer Income Tax Program if you have a modest income and a simple tax situation.

Avoid Fraud and Income Tax Scams

Unfortunately, scammers try to get Canadians to pay debts they do not owe. And tax season is a prime time for scammers. Newcomers can be vulnerable to these scams, especially when it comes to receiving a call or letter from a government agency demanding money for payment. However, you can protect yourself if you know when and how the CRA may contact you.

Click here to learn about scam protection and the CRA to protect yourself from fraud. This information will help you to respond if you get an email, phone call, letter, or text from the CRA that seems suspicious. 

Government of Canada Income Tax Resources

RESOURCES	DESCRIPTION
Newcomer Factsheet	Did you leave another country to settle in Canada in 2024? This information will help you understand the Canadian tax system and what you require to complete your first income tax and benefit return as a resident of Canada.
Benefits and Credits for Newcomers	Discover what benefits and credits you may be eligible for even if you just arrived and have no income.
Get Ready to Do Your Taxes	Get a quick overview of the documents you need to file your income tax return.
Common Tax Terms	Glossary of terms to learn about your taxes.

Learn How to File Your Income Tax Return

Canada Revenue Agency provides online learning resources to help you learn about personal income taxes in Canada. The Learn about your taxes course consists of seven online learning modules:

• One: Purpose of taxes
• Two: Starting to work (why you need a social insurance number, what’s on your pay stub and T4 slip)

• Three: Preparing to do your taxes (what to know before you do your taxes, different ways to do them)

• Four: Completing a basic tax return (an introduction to a basic income tax and benefit return)

• Five: After completing a tax return (understanding a notice of assessment, paying off a balance, working with the CRA)

• Six: Using My Account (how to use CRAs online portal)

• Seven: Accessing your benefits and credits.

In summary, if you arrived in 2024 and lived in Canada even for a short period, it’s smart to file your first income tax return. And with the deadline approaching on April 30, 2025, there is still time to file your income tax return. This will allow you to claim deductions and apply for future tax benefits that will put money in your pocket!

WRITTEN BY

Corinna Frattini

Senior Editor, Prepare for Canada

Corinna Frattini is the Senior Editor and Content Director for Prepare for Canada. She contributes articles to help newcomers achieve their goals in key areas related to living, working, and settling in Canada. With an extensive background in human resources and leadership development, her articles focus on what Canadian employers seek and how newcomers can continue their careers in Canada.

© Prepare for Canada 2025