How software can help you make tax time less taxing

by  Alan Zisman (c) 2010 First published in Business in Vancouver March 9 - 15, 2010 issue #1063

High Tech Office column

Tax time again. If you have a complicated return, you may want to skip this column and talk to a tax professional, but for many readers, tax software is a useful way to prepare a return – or a family full of returns.

As in previous years (I last wrote about tax software in 2007), Canadians can choose between two main competitors – UFile and Intuit’s QuickTax – each offering boxed software, downloadable and online versions. In some ways, tax software developers have it easy; while developers of, say, Microsoft Office, have to work hard to coax users of older versions to upgrade, tax software users have to buy a new copy every year.

Despite that, both products promise improvements beyond updates for compatibility with tax code changes.

QuickTax claims to have been used for over four million Canadian returns last year. The new versions have added “dynamic profiling” to the interview process it uses for tax filers to enter information. This asks questions about life changes – a new baby or home renovation and more – that may affect a tax return.

For an added $15, users of the online QuickTax service can now access personalized support that Intuit calls Ask a Tax Expert, to ask an unlimited number of questions.

Intuit claims each question is individually researched, with most customers receiving a call back within 90 minutes. This is an optional addition to the free support, including the social networking Live Community that Intuit has been using for several of its products.

Another optional add-on, new with the 2008 versions is Audit Defense ($40), promising representation by a tax specialist in the event of an audit by the Canada Revenue Agency. QuickTax users can import data from returns created last year using competing products and can import tax slips from a number of electronic and online sources.

Intuit sells five versions of QuickTax in CD/download editions. These start with a $20 basic edition, followed by a $40 standard edition, which includes RRSP optimizing and other tools, and a $70 platinum edition with enhanced features for investment or rental income.

These editions, plus the $100 business unincorporated edition, each allow up to eight returns. If that’s not enough, the $130 QuickTax 20 edition allows up to 20 returns. (Returns for low-income filers (under $25,000) don’t count toward those limits.)
Online users can file a single return using the standard edition ($17), the platinum edition ($30) and the business unincorporated edition ($40).

Intuit promises a “maximum refund guarantee,” offering your money back if you get a larger refund using any other tax return method.

Competitor UFile counters with what it calls its MaxBack Refund Analyzer, reviewing and optimizing an entire family’s data to ensure the best possible refund.

Like QuickTax, UFile users go through an interview-like process to enter their data. UFile’s developer, Montreal-based Dr Tax Software, suggests its interview process is quicker, simpler and easier to understand.

This year’s software has built-in tools to enable users to make use of the home renovation and first-time home buyers’ tax credits, which are new to this tax year. Pension-splitting calculations enable retired spouses to maximize their returns.

The company notes that UFile, its consumer product line, has the same tax engine used in its professional-level products.
Dr Tax promises its desktop and online products can prepare any Canadian tax return “regardless of complexity.” UFile is sold in packaged or downloadable (Windows-only) desktop standard ($20) and plus ($30) versions; purchasers of the plus version get phone support. Both allow up to eight returns.

Individual online returns cost $16; spousal returns cost an additional $9; and returns filed for dependants are free.

Desktop editions of both QuickTax and UFile are Windows-only; the online editions of QuickTax and UFile can be used on Windows and Mac systems and can be tried out for free. You’ll have to buy it if you want to use it to file a return. Both allow low-income families and post-secondary students to file online for free.