Only 7% of Canadians Reviewed Their T4 Details When Filing Taxes Last Year; Less Than 1 in 5 (17%) Plan to This Tax Season, Reveals H&R Block Canada Study

When it comes to reviewing paycheques, only 9% feel confident they would notice any errors, yet data indicates that more than half of employees are exposed to payroll errors  

CALGARY, AB, March 26, 2025 /CNW/ - Only 13% of Canadians who receive a paycheque say they pay attention to the details on their paycheque to ensure any deductions such as tax, insurance, and pension-related contributions are correct, reveals a new survey by H&R Block Canada. Furthermore, more than one in four (27%) say they don't feel the need to review their paycheque information as they assume their employer is correct in their pay and any deductions. When it comes to filing their taxes, while 65% of Canadians believe they'll get a refund this year (of which 35% anticipate they will get the same or bigger refund than prior years), a significant number of Canadians say they have no idea whether they'll get a refund or owe money.   

"H&R Block is a big advocate of financial literacy in Canada," said Yannick Lemay, Tax Expert, H&R Block Canada. "We don't typically learn about how to interpret paycheques or how to maximize your tax return at school. It's important for Canadians to have the right conversations with the right people no matter what life stage they're at to better understand their pay and tax situation, whether that's at work or with a tax expert."

Key Study Findings Among Canadians That Receive a Paycheque:  

Only 12% of Canadians know how much tax should be deducted from their paycheque. The study indicates that a primary reason for why Canadians aren't reviewing their paycheques or T4 details might be because they're unsure what the accurate amounts and deductions should be. Only 12% (just over 1 in 10 Canadians) say they have a good understanding of their income tax bracket and how much should be deducted for tax purposes on each pay slip.

Less than 1 in 10 Canadians think they would spot an error on their paycheque. Only 9% of Canadians say they feel confident that they would notice an error when it comes to tax deductions on their paycheques. This inevitably means that Canadians would also be challenged to review their T4s to ensure accuracy of tax deductions when it comes time to file their taxes.

More than 1 in 4 Canadians assume their employer is bulletproof when it comes to payroll. More than a quarter of Canadians (27%) say they don't feel the need to review their paycheque information as they assume their employer is correct when it comes to any deductions such as tax, employment insurance, and pension-related contributions.

Separate global data shows more than half of employees experience payroll issues, of which 29% relate to incorrect deductions. While there's a lack of Canadian-specific data on the issue, a global study conducted by Remote, an international talent management company, on the 2024 State of Payroll¹, concluded that 53% of employees said they had experienced a payroll issue in their career. The most common mistake among those that had experienced an issue was they were underpaid (42%), and the second most common mistake was incorrect deductions (29%).   

Around 37% of Canadians aren't confident in knowing how to maximize their tax return. While roughly 10 million Canadians taxpayers (65%) expect a refund this tax season, around 37% don't feel confident in knowing how to leverage all available tax credits and benefits they may be eligible for, to maximize their refund.    

Reviewing your T4 slip before filing your 2024 tax return is crucial to ensure accuracy and avoid potential issues or delays in getting your return.

H&R Block highlights some key tips:

1. Verify your personal information to ensure your name, address, and Social Insurance Number (SIN) are correct. Similarly, check that your employer's details are correct. If there are any mistakes, ask your employer for a corrected T4 before filing your taxes to avoid any issues or delays in filing your taxes and getting your refund.
2. Ensure your 'Employment Income' for 2024 in Box 14 on your T4 matches your total earnings for the year. Compare to your final pay stub or total salary to ensure accuracy.  
3. Review deductions for accuracy; which you can compare with your year-to-date deductions of your final 2024 pay stub. This includes the Canada Pension Plan (CPP) / Quebec Pension Plan (QPP) in Box 16, Employment Insurance (EI) in Box 18, and Income Tax in Box 22. 
4. Check that deductions on capped contributions don't exceed the max amounts for 2024 income, including:
   1. Canada Pension Plan (CPP) in Box 16 has a maximum contribution amount for 2024 income of $3,867.50. Quebec Pension Plan (QPP) maximum contributing amount for 2024 is $4,038.40.
   2. Employment Insurance (EI) in Box 18 should be capped at $1,049.12 for 2024.
   3. If you overpaid, the good news is you can claim it as a refund on your tax return.
5. Verify taxable benefits and deductions in Box 40 for accuracy and to ensure nothing has been missed; this includes employer-paid life insurance, company car or transportation benefits, and medical/dental benefits.
6. Review pension related contributions for accuracy, if applicable. While your T4 doesn't directly show your Tax-Free Savings Account) contribution, it does include your Registered Retirement Savings Plan (RRSP) contributions – but only if your employer contributed to a Group RRSP and it's a taxable benefit. 
   1. Box 14 may include your employer RRSP contributions in your total income.
   2. Box 20 shows your Registered Pension Plan (RRP).
   3. Box 40 may include your employers RRSP contributions as part of your 'Other Taxable Benefits.'
   4. Box 52 shows your Pension Adjustment (PA) and reflects the total value of both your contributions as well as those from your employer if you've contributed to a workplace RRSP or pension plan.
   5. This box will show your total contributions going toward your RRSP contribution limit.
7. If you have more than one job, ensure you received a T4 from each employer you worked for in 2024.
8. If you're self-employed or a gig worker (either as a side income or your sole income), you won't receive a T4 for this source of income. Instead you'll need to complete Form T2125 (Statement of Business or Professional Activity). 
9. Speak to a tax expert if you're unsure how to navigate the more than 400 tax credits and benefits that are available and ensure you minimize your taxable income and maximize your return. There's no one-size-fits-all approach. 
10. Don't procrastinate filing your taxes once you're confident that your T4 is accurate. The filing deadline for income tax returns is April 30, 2025. Don't forget - the earlier you file, the earlier you get your refund!  Penalties for filing late are now 5% of your 2024 balance owing, plus an additional 1% for each month that you file your return after the deadline up to 12 months.

"Filing taxes is both a great way to save money and put money back in your pocket – in the form of a tax refund and access to credits and benefits," said Lemay. "There are a lot of changes this tax season that benefit Canadians. Our advice is to work with a tax expert make sure you know every tax credit, benefit and deduction you're entitled to, based on your unique situation – and file as soon as possible to get your maximum refund."  

About the survey

The online survey commissioned by H&R Block was conducted by H&R Block in French and English from February 12-13, 2025, among a nationally representative sample of 1,790 Canadians members of the Angus Reid Forum. For comparison purposes only, samples of this size would yield a margin of error of +/- 2.3 percentage points at a 95% confidence level.

About H&R Block Canada

A trusted partner of Canadians for over 60 years, H&R Block Canada is Canada's tax leader. Serving almost 1,000 locations across Canada, H&R Block's team of Tax Experts use the latest in technological advances combined with real-world expertise to help people file taxes in office, through drop off service, upload their documents remotely, or use do-it-yourself Tax Software. H&R Block Canada can support in the preparation of personal, small business, corporate, U.S., rental, and estate taxes. H&R Block's comprehensive education program, Tax Academy, trains new experts and ensures our Tax Experts continually update their skills. Learn more at www.hrblock.ca or 1-800-HRBLOCK.

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¹ 2024 State of Payroll Report: the hidden costs of payroll mistakes

SOURCE H&R Block Canada Inc.

For more information, contact: Katie Duffy, H&R Block c/o Ketchum, [email protected], 647-772-0969