Ask a Money Coach: Which Tax Software Would You Recommend?

Posted on: March 18, 2020

Few people look forward to tax time, but with the help of a good software program it doesn’t have to take long or be painful. Most of the well-known options available to Canadians are quite similar, so how do you choose which one to use? The differences arise around support and which features are offered at what cost. Here is a quick overview of some of the most popular options.

Turbo Tax

If Turbo Tax is the first product to come to mind when thinking of tax software don’t be surprised, it’s the most popular program in Canada. It’s available in many versions (Free, Standard & Premium) and also has a package specifically tailored to those who are self-employed. All versions of the program are up-to-date on the latest changes to the tax rules. New this year, is a Turbo Tax Mobile App available for use on all package levels.

Key features of Turbo Tax

All versions of Turbo tax will give you the following:

  • Auto-fill to import your CRA tax data directly into your return
  • Provide an Express Notice of Assessment after successfully submitting through NETFILE
  • Store your returns online for 7 years
  • TLS Data encryption protection
  • NETFILE certified
  • Supports filing in Quebec

Here is what you can expect with the paid versions:

  • The program will identify tax saving opportunities by searching 400+ credits and deductions for you
  • General guidance on tuition, RRSP income, contributions and family benefits
  • New this year —SmartLook™ which connects users on demand with a TurboTax specialist

What to consider

The free version is best for people with very basic returns only, as you will miss out on great options like the credit and deduction search and on demand assistance. Although the Turbo Tax website does have an online discussion community, be mindful of where you are getting advice.

If you could use guidance on investment income and expenses or rental property income and expenses, you may benefit from the Premier package which will provide information in those areas.

If you are your own boss, the Turbo Tax Self-Employed version offers guidance on reporting income and expenses. This version is also good for part-time side-hustle income and home based businesses.

The website lists the paid online versions as follows:

  • Standard $19.99 per return
  • Premier $34.99 per return
  • Self-Employed $44.99 per return

Simpletax

First available in 2012, Simpletax is one of the newer kids on the tax software block. This well designed platform caught the attention of Wealthsimple which acquired Simpletax in 2019. One of the very attractive features of Simpletax is that it forgoes the tiered price point versions and has one free offering. After you file your return there will be a request for financial support for the product, but how much you pay—or even if you pay—is completely up to you, no strings attached.

Key features of Simpletax

  • Online and easy to use
  • Your refund is calculated as you go
  • Simple lists of questions to help you maximize your return
  • RRSP calculator
  • Auto-fill your CRA tax info
  • NETFILE certified
  • Secure Encryption and offers two-factor authentication
  • Up to 20 returns per account
  • Offers translation to French
  • Supports Quebec returns
  • Express notice of assessment

What to consider

They offer search functions and tutorials to help you find forms, deductions and credits, but general info may not be enough if you have a complex tax situation. That said, it can still be very helpful for folks who are self-employed or those with rental or investment income. And you certainly can’t beat the price.

UFile

UFile has been around for 20 years and has an excellent reputation. Ufile is free for those with income under $20,000 and for students regardless of income. It’s also free for newcomers to Canada filing their first tax return. Those who don’t qualify for the free version file at $19.99 per return. Those with investment or property rental income will appreciate the ease of use for these more complex returns.

Key Features of UFile

  • Auto-fill your CRA tax info
  • Secure bank level encryption
  • NETFILE certified
  • Supports Quebec returns
  • Automatically allocates deductions and credits to calculate optimal pension split
  • Stores your returns for 9 years
  • Express notice of assessment
  • Offers a refile service if you need to make changes on previous returns

What to consider

UFile is good for small business owners and the self-employed without a higher price point. Works well for people with multiple sources of income. Unlike some other tax software products that keep a visible running total of your return as you progress, you will need to toggle back and forth with the Tax Return Tab to view that information. But also unlike some other software, UFile doesn’t bombard users with upsell requests.

StudioTax

Around since 2004, StudioTax is totally free for all users. They say if you are happy with their software you are welcome to make a donation. There is no online version, it’s strictly a downloadable product for Mac and Windows (not available for smartphones or tablets) and you then file through NETFILE. When you first visit their site you may be thrown by its dated look, but it is a respected option in the tax software world.

Key features of StudioTax

  • NETFILE certified
  • Supports Quebec returns
  • Express notice of assessment
  • Handles self-employment and rental income
  • Step by step interface easy to use
  • Up to 20 returns
  • No income restrictions

What to consider

The fact that there is no online platform can be seen as a pro or a con. StudioTax presents it as a pro, siting the fact that your personal info is stored at home on your computer and not at risk to hackers in the cloud. That of course means your info is only as safe as your home computer. If you decide to use StudioTax also make sure you save and create back-ups of your returns for at least 7 years.

CloudTax

CloudTax offers a free and paid option. What makes them stand out is the unlimited chat support offered on their free version.

Key Features of CloudTax

  • Unlimited support chat
  • Auto-fill your CRA tax info
  • NETFILE certified
  • Mobile and tablet options
  • Audit protection ($2.99 a month)
  • Express notice of assessment
  • Optional audit protection for $2.99 a month
  • Digital return storage
  • Secure encryption

What to consider

The free version doesn’t handle business or rental income, for that you will need the paid version at $39.00 per return. Currently CloudTax is not available for Quebec, Yukon, the Northwest Territories and Nunavut.

Choose what’s important to you

Look through the options and see what resonates with your needs. If you have been using a program but not happy with it, see if any of the features above address what you were dissatisfied with.

If this is your first time filing online, and you have a very simple return, any of the free options will probably suit your needs. But if you have a more complex situation, are self-employed or just generally want more guidance, a paid version will probably help you maximize your return.

Whichever product you end up choosing, it’s important that you are prepared. To assist you we have created a Tax Time Checklist that will help you to get all your information gathered and organized. You can get the list here.



Category(s): Ask Your Money Coach, For your information, Money Coaching, taxes
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9 Responses to Ask a Money Coach: Which Tax Software Would You Recommend?

  1. What about H & R Block tax software. Any good, it’s not listed
    Thanks

  2. Cathy Currie says:

    We are a retired couple with pensions and investment income (capital gains/losses, dividends & interes). We have used Turbo Tax for years and wonder if we should be using the premier version rather than the standard.

    • Hello Cathy,
      I think it would be worth your while to try the Premier version for this year. It only costs $20 more than the Standard version and may help you with your investments. If you find that no value was added, you could go back to the Standard version next year.
      Have a poke around the internet as you can get discount codes for TurboTax through various personal finance websites and blogs.
      Let us know how you make out!
      Steve Bridge

  3. Have used UFile since 2008, when TurboTax’s predecessor made a massive cut to number of returns. Totally inexplicable how someone could have concluded it’s become less friendly and requires intimate knowledge of taxes to benefit. If anything, it’s become way better, as its summary of T-slips is indispensable, and now even posts the 100% and spousal-split values for every box on the slip.
    I have a USD pension, and handling variable exchange rates is a snap. The pension-sharing optimizer is far superior, and takes into account claw-backs of social benefits in its calculations.
    The base version covers all situations for $22, whereas TuurboTax costs $70 to handle even mildly complex returns.
    They added free support to the base version (no toll-free) to keep up with competition, and 12-returns only costs ten bucks extra.
    They do have the wart in allowing you to declare a spousal split on T3 or T5, without defaulting to auto-add to spouse’s return without clicking on a drop-down confirmation, and the CRA caught this unreported income, but we escaped without a penalty, just paying unreported liability and interest, unlike commenter who got a penalty imposed. I’m very careful in verifying — but the T-slip summary is a godsend in this regard!

    • Thanks Davie215 for your comments. I agree with you about UFile. I think it will suit many tax-filers. I especially like that it captures data from previous returns. That can help with tax planning going forward. And the price is right. As always, I recommend speaking with a Money Coach or tax professional for more complex tax questions or situations.

  4. Gillian Villeneuve says:

    What about Taxtron? I’ve used it for years.

    • MoneyCoach says:

      Hi Gillian,
      We haven’t used this software. How have you found its functionality?

      • Gillian Villeneuve says:

        Like I said, we’ve used it for years as it was the first tax software available for Mac. We’re accustomed to it and it works well for us. In the past their support has been top notch, tho’ I don’t know about this year. But I’m not an expert either.

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