Tax Literacy Tool Kit

Students can earn Deputy TaxDetective® status

... and have fun while they learn about tax

How can students learn about tax?

By doing sample tax returns. TurboTax® or UFile® are both available online and they are both free for students to use in the computer lab or at home. Students can use a fake SIN#. The secret is that it isn't necessary to pay until (or if) you file the return, which of course, they won't be doing.
By using case studies. Stories are still the best way to learn, see the case studies below. Then it's possible to change the return to see what happens 'if'' and how the tax payable or refundable changes as a result.
By reading real life tax stories. CANLII is an organization that has made it their mission to make those stories (they call them judgements) available at www.canlii.org
My new Student WorkBook allows students to work in the 'cloud', so there's no need to prepare a lab, all that's required is an internet connection. Students save their work to the 'cloud' and then access any computer with an internet connection to continue their work.

Why would I want to teach kids about tax?

Because learning about tax, it's how most of us got the big picture about how people earn a living. They see the various categories, consider the options, and just maybe, a light goes on.

Most of us learn about tax after high school, taking tax courses, at a local college, or through the CGA program.

The basic course on personal tax is 10 lessons.

The advanced course about corporations, tax free rollovers, shareholder loans and benefits, partnerships, trusts and death, is 10 more lessons.

After that, you're an expert (ha).

CRA did a survey to learn about young adults and their knowledge about tax: CRA: YA and taxes (prepare to be depressed).

I read this report and decided to create a curriculum about learning tax. My criteria, it had to be hands on, and there had to be stories; and it had to be fun.

To my surprise, my husband, who teaches high school math in Vancouver informed me he is responsible to teach tax as a part of the math curriculum. What's included is very basic, there's little time devoted to tax.

There's a module on preparing a paycheque, a T4Slip and a T1 personal tax return. If you're lucky, a 90 minute lesson.

I offered to take his Math 11 Essentials class through an online discovery in a computer lab with Intuit's TurboTax® and UFile® software both free and online.

Word spread. Other students, Grade 12's and staff from the admin office appeared in the doorway, asking to join. Soon every computer in the lab was in use. Tax was a pretty hot topic, especially for kids who work after school and tax was being taken off their paycheques. We were able to help by introducing TD1's and how they work.

Here's what happened in the 90 minute lab

Registering each student for access took 10 minutes. Each student registers, which requires access to an email address (they can all use the same one), sets up their unique User ID and password, chooses and answers a skill testing question.

Then they set up their fake tax return with a fake SIN#.

You can use the basic exercise from the textbook T4 if you want. After that, it was an easy step to playing 'what-if'. Imagination took over as they made up stories to create tax returns.

The 90 minute class was over almost before it started. This experience inspired me to create a Student WorkBook, some case studies, and videos to walk students and their teachers through the process, step by step, to introduce this idea to teachers at their financial literacy PD day on Friday.

The Student WorkBook has Basic Case Studies like these:

Student, paper route, mom drives on rainy mornings, sister helps out
Student, works at MacDonalds as a cashier
Student, works as waitress in pizza parlor, tips, no tax taken at source
Student: away at University, moves home for summer job, moves back to go to school
Young Adult: first full time job

Click here to find Links to Resources for Five Basic Case Studies

The Student WorkBook will have links to videos explaining how to log in, showing step by step instructions, plus a video of each case study will walk the teacher through the case study. Teachers may use the videos to walk the class through or leave the students to work on the cases independently. The videos can be provided to students through the school library.

Students will be able to access the videos to learn about tax by watching someone do tax, and then by working in the free software at their school computer lab or on their library or home computer.

In the Student WorkBook, there are five case studies, links to the video for each case, links to reading/resources, questions for students to answer and solutions to those questions.

Links to the resources will be found on a separate webpage to facilitate correction of links gone bad as is wont to happen from time to time on government websites. (See link to separate page)

The Student WorkBook uses the internet in real time. Students work in the 'cloud', so there's no need to prepare a lab, all that's required is an internet connection. Students save their work to the 'cloud' and then access any computer with an internet connection to continue their work.

I've thought about creating an advanced Workbook (but only if there are orders in advance as each case takes a few hours)

Samples of potential Advanced Case Studies

Teacher, single parent with child & mother lives with them
Teacher, married with spouse/partner in University, student loans
Inventor earns a million dollars, has surgery in Texas
Dad works full time, Mom runs a daycare, family has tenant in the basement suite
Senior, single, pensions & dividends, can't walk, lives in retirement home

What are some other ways to learn about preparing taxes?

Teachers are encouraged to register their school at www.intuiteducation.ca. Intuit Canada provides a class set of educational software and everything needed to set up a lab, including special installation key codes for the computer lab. This approach requires lab preparation time.

The Intuit education package utilizes older software versions. If internet connection speeds from your internet provider are slow and causing the students frustration, this may be an excellent alternative.

UFIle® also provides free student access and a sample SIN #. It's a great idea to compare and contract how the two software work to determine which suits you best.

CRA programs for learning

CRA educator products

Once you complete the questionaire,

This page appears with the three programs

Here's the course overview for learning about taxes

Keep reading right to the bottom of this page to go more indepth:

1. Explore how various government Ministries interact to create and administer tax

2. Explore the Income Tax Act and Regulations

3. Review the authorization process, My Account and Represent a Client

Can you access Income Tax law?

Yes, you can. The Income Tax Act is found on the Minister of Justice's website. You can hunt through the Table of Contents to find a section, or you can change the address right at the end, to change to the section you want to see (there are 248 sections).

Here's the link to section-1, all that's required is to click the link, and then edit the section number, for example, edit the -1 and make it -2 or -69 or -118.2 (medical expenses)

http://laws-lois.justice.gc.ca/eng/acts/I-3.3/section-1.html

The Act comes with ancillary Regulations found here and note that it's by page, so changing the page # will move you through, as will the Table of Contents

http://laws-lois.justice.gc.ca/eng/regulations/C.R.C.,_c._945/page-1.html

Page 121 is where you'll find Regulation 5700 with a listing of the medical devices and equipment referenced by S. 118.2(2)(m)

Page 122 is where you'll find Retention of Books and Records in Regulation 5800

Supreme Court in Canada Trustco case, explained that the Income Tax Act should be read in such as way as to concern ourselves with content, context and purpose. That requires knowledge about how the Act is constructed in total, how each part relates to the other and why it was set down as law in the first place. That's a tall order.

You could think of the Income Tax Act as an algebraic formula written in prose. The same formulas appear over and over again. Reading it out loud helps, and it's important to always look for the mathematical connecting words

Those little connectors, like "Or", "And", "Less" and "the Sum of" help us determine the formula to use.

Tax Research Education

The rest of this page is for teachers who want more than just an hour in the computer lab to learn how the software works and to play what-if. What follows is a complete curriculum outline for learning about our taxation system and how we communicate about tax. The following activities engage students in planning, mathematics, law and internet research while exploring taxation in Canada.

—Target age range is 16-18 (grades 10 to 12)

—These activities allow for creative exploration of government websites, and can be used individually or sequentially.

—These activities may be assessed using the provided evaluation tools. Where possible, suggestions for modifications are provided.

Learning Outcomes

Explore how Finance, Justice and Canada Revenue Agency interact
Explore the Income Tax Act and Regulations
Explore how tax law is applied to real people in Tax and Supreme Court cases
Open your own tax history using "My Account"
Learn how to research tax questions

Curriculum Connections

Planning 10
Law 11
Math 10 Essentials
Math 11 Essentials
Business Information Management 12
Entrepreneurship 12

Course Content

Finance
Parliament
Justice
FINTRAC
Courts
Canada Revenue Agency
Tax compliance software
Researching tax questions
Non compliance = convictions
Voluntary disclosures, penalties and interest, civil penalties

Activities:

How laws are made: (Let's follow the TFSA through the process

Finance FAQ
Finance creates amended legislation
- TFSA creation in 2008 budget
- Notice of Ways and Means in a Press Release March 11, 2026
- Explanatory Notes in a Press Release March 14, 2026
Parliament posts Bill
TFSA included in Bill C-10 January 27, 2026
- Received First Reading in 40th Parliament 2nd Session which commenced January 26, 2009
Follow the status of Bill C-10 at Status of House Business
Open the Bill to read it under House Government Bills (list of Bills C-10)

Once the Bill is passed and the Senate approves the Bill, Justice amends Income Tax Act and adds Regulation 5000 and 5001 to describe Prohibited investments to TFSA's

Long before the Bill is passed, CRA acts like the law is already in place in order to create the forms, guides, publications, and systems to administer the TFSA as if it is law already

CRA advises Registered Plan Administrators about TFSA
CRA advises individuals about TFSA
CRA creates publication RC4466, an information sheet and advises of other publications that may have an impact (see bottom of RC4466 where IT Bulletins and Form RC240 (not yet created) are listed)

Where to find information about income tax:

Site Map
Forms and publications
Online services
Individuals:
- Child and family benefits
- Being employees
- What to do when someone has died
- How to report on a trust and what types of trusts there are
Business hires an employee
Landlord reports rental income
Investor accounts for capital gains on sale of investment
Seniors
- pension splitting rules
- CPP, OAS, GIS
Self employed persons
- Keeping records
- Records
- Business Records
- GST/HST
Persons with Disabilities
Corporations
- records employee taxable benefits
- files T2 corporate tax return
Non-Profit Organization reports
Charity reporting and whether or not an organization is a charity

Where to find information about court cases:

Law student assist taxpayer with research about a landmark Supreme Court case on how to read the Income Tax Act (Canada Trustco)
www.Canlii.org

Assessment

Knowledge / Understanding

Does student demonstrate

awareness of major concepts?
understanding of major concepts?

Thinking and Research

Does student

use major tax concepts in an insightful manner?
make links between major tax concepts that are strong and relevant?
understand how to use the CRA search engine and site map?

Communication

Can student organize and present major tax concepts effectively?

Does student use "tax language" to research queries?

Can student determine when they require more information and contact CRA help to ask for more information?

Application

Does student complete and document appropriately:

TD1 for employee with T4 income, a spouse, one child or a parent over 65 who lives with them
A T4, T4 Summary and ROE for an employee
Self-employed income schedule including asset acquisitions, vehicle and home office cost claims
Rental income schedule
Capital gains Schedule
Investment Income Schedule
Medical expense claim form
Donation tax credit claim form
Tuition and education claim and S11, BC S11 transfers to spouse, parent, grandparent
Child care expenses
Child fitness tax credit claim

Course introduction

Who plays a role in the establishment of our laws?

Politicians
Finance Department
Parliament
Senate

What are the laws?

Federal Statutes
Provincial / territorial Statutes
Municipal By-Laws

Where do we find information?

Canada, Provinces/Territories
Finance
Parliament
Justice
Statistics Canada
Industry Canada
Canada Business
FINTRAC
Proceeds of Crime, Money Laundering & Terrorist Financing Act
Canada Revenue Agency
CanLII.org

Who enforces the law?

Auditors
Officers of the Courts
Courts Administration Service
RCMP, provincial or local Police
Attorney General
Judges via the Court system
Jail, fines, penalties

Why do we need law?

Social order
Public programs
Services, infrastructure
Protection from harm

How do social policies and federal tax laws define acceptable financial behavior?

Self-assessing system in Canada
Ignorance is no defence,
Guilty until proven innocent
Expected to know and comply with law

Activities to engage in to protect ourselves from harm:

Education
Keeping records
Planning to minimize taxes

but only if our planning does not step over GAAR General Anti-Avoidance Rule (since 1995)

Section 245 of the ITA

IC 88-2 GAAR -

IC 88-2S1

G500-6-9 GAAR and GST

IT News on GAAR reviews - 2005

Decided cases to search for on www.canlii.org

Kaulius (loss transfer - SCC)
Desmarais (surplus strip)
CECO (partnership / disguised proceeds)
OGT Holdings (QCA - Quebec shuffle)
MacKay (avoidance loss transfers - FCA March 2008) leave to appeal to SCC sought, decision delayed until after Lipson
Landrus (non arms length loss realization - TCC May 2008) under appeal to FCA
Remai (charitable donation - TCC August 2008) under appeal
Lipson (attribution - SCC January 2009)

Watch for decisions on:

MacKay (SCC)
OGT Holdings (QCA)
Garron Family Trust et al (TCC)
Collins & Aikman (TCC)
Lehigh Cement (TCC)

INCOME TAX ACT AND REGULATIONS

Part 1

Division A - Liability for tax S. 2
Division B – Computation of Income S. 3-108
Division C – Computation of Taxable Income S. 110-114
Division D – Taxable income earned in Canada by Non Residents S. 115-116
Division E – Computation of tax S. 117-127
Division F – Special rules S. 128-143
Division G – Deferred and other special income arrangements S. 144-148
Division H – Exemptions S. 149
Division I – Returns, assessments, payments and appeals S. 150-168
Division J – Appeals S. 169-180

Part 1.1 to XIV Other Taxes included in S. 180.2 – 219

Part XV - Administration and Enforcement S. 220-244

Part XVI - Tax Avoidance S. 245, 246

Part XVI.1 - Transfer pricing S. 247

Part XVII – Interpretation S. 248-262

Regulations

RESEARCH TAX TOPICS:

1.Keeping Records

2.Students

3.Employees

4.Employers

5.CPP and EI

6.Business

7.New Business

8.Industry Canada

9.Self-employment or partnership

10.Corporations

11.Employee benefits

12.Capital Property

13.Capital gains

14.Rental property

15.Principal residence

16.Investment income

17.Retirement

18.Tax Free Savings Account

19.Marriage/Partnership

20.Separation / Divorce

21.Support

22.Personal Tax Credits

23.Line 300- 378

24.Child and Family Benefits

25.Persons with disabilities

26.Social assistance

27.Seniors

28.Death

29.Trusts and Estates

30.Consequences and Convictions

RESEARCH: ADMINISTRATION OF TAX

Keeping Records

—Tax Returns (some major categories)

—T1 (Personal)

—T1Adj

—T2 (Corporate)

—T3 (Trusts & Estates)

—T4 (Payroll)

—T5 (Interest and dividends)

Forms and publications:

Tax Schedules
Topic list: Guides, Forms and Publications
Document Types
Client groups

Representation

Security of Taxpayer Information

epass Enabled Services

CRA's electronic services overview

Individual: T1013

Level 1 allows CRA to disclose information to the representative
Level 2 allows the representative to request changes to your tax returns

Note Level 2 authorization does not permit changes to your basic information such as your address, identification, marital status, direct deposit or 8 digit code

Who should you give authorization to?

Consider carefully whether to provide Level 2 authorization

Adjusting your tax return may be accomplished by letter, Form T1-ADJ or online in My Account using a change request.

Business: Contact person/representative

Form RC1 Request for a Business Number - provides for Contact Person only - must complete an RC59 to authorize a representative
Pamphlet RC2 - The Business Number and your CanRev Accounts
Form RC59 Business Consent Form
- Level 1 review information
- Level 2 allows the authorized person to make changes

Note: Unlike Individual representative, if you don't choose a Level for Business the default is to Level 2!

Adjusting your corporate tax return

GST/HST Rebates

CPT139 CPP/EI - Authorizing or Cancelling a Representative

Internet Security Tools

Canadian Legal Information Institute

CanLII is a non-profit organization managed by the Federation of Law Societies of Canada.

CanLII’s goal is to make Canadian law accessible for free on the internet

CanLII is testing a Beta version that will enhance the delivery of legislative material, currently Federal statutes and regulations and some provinces are available with more coming online shortly.

Links to more TaxDetective webpages:

Financial Literacy Tool Kit

What's New 2009

What's New 2010

What's New 2011

Disclaimer: Eileen Reppenhagen CGA does not research or endorse any product or service appearing in ads posted on this site. Please do NOT rely on or use the information on this website as a basis for a course of action without obtaining appropriate professional advice .