Taxes: Why so complicated?

Don't get me wrong, I know we need to pay taxes. I'm not even going to suggest that we get rid of taxes, because I know they are necessary in our society. What I am saying is that he taxation system has gotten way too complex!

I am a university student. I live at home and work 4 months of the year. In September I leave home and head north to North Bay where I rent an apartment, attend classes, and stop working for 8 months of the year. One would think that my taxes would be simple because; a) I only work 4 months of the year, b) I live in a university residence, and c) Most of my money comes from the government (student loans and grants). Unfortunately, the lack of communication amongst government departments and the total incompetency of our taxation system makes it incredibly difficult.

Lets start with income. I work 4 months. That income is obviously reported. Then comes the loans, scholarships, grants and bursaries, almost all of which come from the government. Some of them say that I have to claim them on my income tax, others say that I don't need to claim them, and others say nothing at all. This is where it gets complicated. I get a loan from the Government of Canada, a loan from the Government of Ontario, a bursary from the Government of Canada, and a bursary and grant from the Government of Ontario. The one thing these all have in common is that they come from the Government.

Lets be clear. The Government doesn't forget that they have given me this money. They keep records of this stuff. So why then do I have to claim this on my taxes? Shouldn't the government know they gave me the money? In short, no. The grants, bursaries and loans come from various departments in various levels of Government, and do you think they will share this information with the Canada Revenue Agency (CRA)? No. They won't. They won't communicate with each other at all. In fact, they barely communicate with me! I don't know what needs to be claimed and what doesn't!

Next, I have a billion credits to wade through to find that I'm eligible for barely any of them. Education credit? Sounds simple enough. I just have to get a T2202A form that the university has already submitted to the CRA- wait. Already submitted? The Government already knows how much I paid for tuition? Yes. Actually they knew before taxes because the University has already told the Ontario Student Assistance Program (OSAP). Then the University told them again by submitting the T2202A to the CRA. And now I have to tell them.

Now,what about the textbook credit. Does the CRA make the assumption that I bought textbooks while at University? No, I have to tell them that.

And what's with all those questions that have absolutely nothing to do with me. Do I own rental properties? I do believe I have already been asked that by OSAP. Am I married? OSAP knows. Did I move? Well I'm not commuting 4 hours everyday to go to school, and OSAP knows where I go to school.

Lets look at the Ontario Property Tax Credit. To be eligible you must be over 16, check. Must pay property tax or rent, check. Must not be a dependent, check. Seems to me that I am eligible for this credit. Why shouldn't I be? I paid for my residence, the equivalency of over $700/month for 8 months! But no, apparently paying rent to the residence isn't the same as paying rent to any other landlord in the province. Apparently all I'm eligible for is $25 for living in residence. $25. Thanks Ontario.

Now what happens when you need help with this monstrosity we call taxes? Not a whole lot. I had the above predicament happen to me this year, so I called the CRA to ask them. Their response: "Thank you for calling Canada Revenue Agency. No one is available to take your call right now. Please try again later." Click. Thanks. 5 phone calls later I finally get through, and a lady tells me that of course I am eligible! "Just call the university and get them to send you a signed letter stating how much you paid." So I call the University and they tell me no, I am not eligible and they will not provide me with a letter or a tax receipt. So I call CRA another 4 times and a different lady tells me that I am probably not eligible. Probably? The letter I have says they want to see this receipt within 30 days. I don't have time for probably. So I call back and yet another lady tells me that I am most likely not eligible. She says that I am however most likely eligible for the $25 residence credit.

So I wrote a letter to CRA, using a lot of "maybe's" and "probably's." I probably did my taxes wrong, and I might have to ask them to make changes to it. Maybe. I faxed it to them, so I know they have it now. I'm still waiting for their response.

Taxes will never be a fun time of year, but it doesn't have to be so painful and complicated. If the Government could get some interdepartmental communication going, and simplify all these tax credits than perhaps people wouldn't mind doing taxes every year. I don't think I'm asking for much. I just want the Government to communicate with itself, and the taxation system to be streamlined.

How much money could the Government save it they shared information? Hey, they might even be able to lower taxes with all those savings!