Account and says I owe $1350 in taxes because I worked 2 jobs, but I only worked 1 of those jobs for 4 weeks

[calena7582]

Hear me out, I know it’s not tax season. In short, I make $60k a year.

Last year I left my main job for 4.5 weeks to work at a sister company, this was not a self-employment job. I did not make any more money from this, I made the same amount as I’d make at my current job.

My accountant is now saying I’ll owe $1200 in taxes for doing this. That’s basically what I made from working those 4.5 weeks.

I did the same thing in 2017 and didn’t have to pay this much.

How is that possible?

 

[jaspers]

@calena7582 Common problem when you have more than one job. Payroll for 1st job takes into consideration the $14(k) non refundable tax credit. Basically doesn't tax you on the 1st $14(k) of income. 2nd job is doing the same thing. When you do your taxes you only get the one deduction. Every employee has to complete a TD1 to state all the personal tax credits they are entitled to. Long form, very few read it. But on the second page there is a box to state that you have more than one employer and then you would be taxed appropriately.

 

[freak217]

@calena7582 Hi thank you for confirming you worked two jobs publicly. Pay us.

 

[garfield156]

@freak217 I accept best Buy gift cards

 

[djkword]

@calena7582 Taxes are not based on jobs they are based on income. Look up a tax calculator for your province and you will see how much you owe in a year on your income.

What your job tries to do is estimate your taxes and withhold them so you don’t have a big tax bill at the end of the year.

The problem is your job doesn’t know your whole situation. They only know how much they pay you nothing more. They don’t know if you have other income or other tax credits.

So sometimes they estimate incorrectly and you owe some more or owe some less.

It’s not a penalty or a punishment it just means your paycheques were higher than they should have been all year.

 

[robbu]

@calena7582 Was the pay the same at the 4 week job? If so, were they deducting the same amount of taxes as your regular job?

 

[tobymacfanz]

@calena7582 By "basically what I made," do you actually mean "basically 25-40% of what I made" at that other job? 60k a year is 5k a month. So let's say you earned 5k over those 4 weeks. Your total deductions from that 5k should be around $1500 or so. But also, your primary employer did not deduct enough, most likely if they planned for your absence during that time.

So how much did you earn over those 4 weeks, and how much did you actually take home? Did you receive a pay stub? How much did you pay in deductions for that work?

 

[keeper978]

@calena7582 Maybe that second job did not take taxes out for you, but did the other year? Pretty common if they know you will be paid less than $10000.

 

[barryn]

@calena7582 Most likely both jobs taxed you at rates calculating that the income you would earn is all that you would earn for the year. Which means you had 5K of improperly taxed income, which would result in the taxes you are seeing.

Your taxes are pretty easy to calculate with your T4s. You can download the forms, or use a tax software like UFile to get a better sense of how much you owe ($20 vs $100 tax agency).

Pro tip, find ways to reduce your taxable income. The easiest way I’ve found is to contribute to my RRSP. Another easy way is to take a college class each term. If you reduce your income and don’t fill out the adjustment forms, you will almost always get money back. Always more pleasant than owing.

If you follow the above method some people will say, rightly, that you are loaning the government money interest free, and realistically it’s less than the cost savings of learning to do your own taxes in interest and probably worth the peace of mind. Plus you’ll have more skills, which should translate to higher income, and will be able to afford retirement. You’ll come out ahead.

 

[nessa719]

@calena7582 trust the pro

 

[garfield156]

@calena7582 Because you filled out your td1 wrong probably

 

[caxyxn]

@calena7582 You need to educate yourself on how taxation works. Your taxe bracket is calculated on total income.

You've mostly likely fallen into a higher tax bracket and haven't cumulatively paid enough because each employer taxed you at a lower rate.

Next time you simultaneously work two jobs you need to calculate which tax bracket you will fall into and plan accordingly. Either you set money aside for tax season or you ask one of the employers to deduct more taxes.