York U. Students, Faculty Team Up with RevCan to Help Needy Navigate Tax Returns

TORONTO, March 1, 2000 -- As pundits, politicians, and advocacy groups continue to pore over Finance Minister Paul Martin's budget brought down earlier this week, Canadians are beginning to turn their minds to their own budgets -- and to the task of filing their annual income tax returns.

That task may be a chore to many Canadians, but to the more vulnerable members of our society, it's a daunting prospect, especially to those unfamiliar with, or intimidated by, the forms, figures and officialese of Revenue Canada. But there is guidance -- gratis -- thanks to the good will and good thinking of Professor Joanne Magee, who teaches income tax law at York's Atkinson College where she is also Associate Dean.

For the sixth consecutive year, York University is running four free tax clinics throughout March as a community service provided by volunteer Atkinson College accounting students who help low-income individuals prepare their tax returns free of charge. Fourth-year students work in pairs to manually prepare returns. Every year they complete about 100 returns, which Magee personally reviews. Revenue Canada provides free training and materials to these York students throughout February.

Three clinics will be held on March 2, 7, and 14th from 2 to 5 p.m. at the community centre of an apartment building in the Jane-Finch area. A fourth clinic will be held March 10th, 1-4 p.m., at Northminster United Church in the Bathurst-Finch area.

"The tax clinics allow student volunteers to use their skills and expertise to help low-income people benefit from the tax benefits to which they are entitled. It is important to provide students with these opportunities and mentoring," said Magee who came up with this idea after being inspired by the volunteer tax clinics run by the Institute of Chartered Accountants of Ontario since 1969. "These experiences allow them to use their skills and give something back to the community through volunteer work. They benefit from hands-on learning and they see how others live," she said.

Magee said about eight students will be working on about 24 returns at each clinic, adding that some of the volunteers have come back year after year to offer their assistance to the York clinics. She said the York students perform an invaluable service to people, many of whom would suffer needless extra hardship without the guidance they get at the clinics.

Consider, for example, the case of one low-income senior in her late sixties who had been widowed and left bankrupt by her husband the previous November. Since she was bankrupt, the trustee was entitled to her refund (Ontario Tax Credits) but not her late husband's refund. The students helped her apply for the Guaranteed Income Supplement (GIS) for the first time. (She had virtually no income after being widowed, but hadn't qualified for this supplement while her husband was alive.) While working with her on the two returns, the students noticed how very frail she was so they walked her through applying for a disability tax credit, worth about $1,000. The students then claimed the disability tax credit on her husband's final return and Professor Magee helped her apply to go back several years to claim it on his previous returns, even driving her to the doctor when Revenue Canada queried the credit and asked for further information from her doctor.

Magee said this case illustrates some of the common problems that low-income seniors have with the tax system: filing a tax return for the first time -- often because the spouse who filed the return dies or because they are new to the country; filing a deceased taxpayer's return (more complex than a regular return); failing to realize that they may qualify for the disability tax credit; navigating the tax system.

Magee said the ever-changing tax system becomes more complex every year, adding that she considers it to be "very harsh." As an example, she points to an 85-year-old disabled person who missed reporting interest income on two slips and was assessed a 10 per cent penalty and interest charges on top of the additional tax she owes. Magee says this problem can be resolved by making a claim to waive interest and penalties under the fairness provisions, but suggests that many people end up paying needless interest and penalties because they simply do not know how to get help or are unaware of entitlements such as disability tax credits.

Magee adds that it's important that these individuals get their returns prepared as soon as possible so that they can apply for the GST credit, Child Tax Benefit, Ontario Tax Credits and the Old Age Security Guaranteed Income Supplement. Otherwise, she notes, they will pay tax discounters to prepare their returns and lose some of their badly needed refund.

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For more information or to arrange interviews with students or clients, please contact:

Prof. Joanne Magee, FCA
Associate Dean, Atkinson College
York University
(416) 736-5220

Sine MacKinnon
Senior Advisor/Director, Media Relations
York University
(416) 736-2100, ext. 22087
YU/023/00