Tax-Software-Review.ca

Online Tax Software Review 2010

 

Summary: I tested Online tax applications from three companies last weekend - Quicktax, Tax Chopper. and H & R Block - and I found that Tax Chopper was the best in terms of calculation and optimization, providing you were not a Quebec resident or a non-resident. The aspects I tested include:

 

  1. Preparation of multiple returns for a family together (Tax Chopper is best)
  2. Commonly used optimization (Tax Chopper is best)
  3. Capabilities (Quicktax and HR Block are tied)
  4. In search of the best pension split amount (Tax Chopper is best)
  5. Service Guarantee (Quicktax and TaxChopper are tied)

 

 

Only three Online Web applications were tested. For the rest of the online products, none of them have any unique features, they are either a copycat (for example, UFile is a clone of H&R Block), or couldnít compete at all in any of the areas I tested.

 

I also wanted to avoid vague points like ease of use. All three of them are pretty easy to use, people have different tastes about this. It is up to you to decide which is the easiest.

 

Only real functions that make real differences to you are compared.

 

Aspect 1: Preparing family returns together

 

Quicktax

Poor

You can only prepare one return (for a single) or two returns (for a couple). There is no way to add a third person. So you canít use it to transfer credits between a child and a parent, or between siblings.

 

For couple returns, both spouses have to be in the same province.

 

H & R Block

Good

You can prepare a number of returns for a family. Besides the head of the family, you can add dependants. Credits can be transferred between family members.

 

However, there are conditions for dependants. You canít transfer credits from someone who is not a dependant as defined by the software.

 

TaxChopper

Excellent

You can add all your family members in one account, there are no conditions to who can be a family member. Optimization can be done among all family members.

 

The winner goes to Tax Chopper

 

 

Aspect 2: Optimization:

I used three returns to represent a couple and their child. One spouse has around $50K income and the other spouse earns $8000 income. They have a homebuyer amount, home renovation tax credits to share and I deliberately put the homebuyer amount and $500 public transit amount under the spouse with the lower income.

 

Then I added other non-refundable credits to the one who gets tuition transfer from a child to a point when a less-than-maximum tuition transfer is needed to reduce tax payable to zero. In this case, the tuition transfer from child should be reduced. Otherwise, the childís future credit is going to be wasted.

 

Here are the results

 

Quicktax

Okay

It is able to suggest to me to let the spouse with the higher income to claim the homebuyer amount and home renovation tax credits. It fails to suggest that the high-income spouse should also claim public transit amount for the other so that credit is wasted.

 

I need to put the tuition transfer by myself because a 3rd return is not supported in the same account.

 

When I reduce the income, it fails to tell me I should reduce the tuition transfer from a child so he can use it in future years.

 

H & R Block

Very Good

Home renovation credits, homebuyer and public transit credit are all claimed by the spouse with the higher income automatically. It is great!

 

When other non-refundable tax credits are added, the provincial child tuition transfer was reduced but the federal was not, due to an Ontario LISF calculation bug.

 

TaxChopper

Excellent

A warning message was given to tell me I should let the spouse with the higher income to claim some of credits until I move all the credits away from the lower income spouse.

 

When other non-refundable tax credits were added, both federal and provincial tuition transfers were reduced to the exact amount to make the tax payable to zero.

 

The winner goes to Tax Chopper

 

 

Aspect 3: Capability

 

 

Quick tax

H & R Block

Tax Chopper

Supports all provinces

Yes

Yes

Yes

Supports Quebec provincial return?

Yes

Yes

No

Supports non-resident?

Yes

Yes

No

Supports deceased return?

Yes

Yes

Yes

Supports Emigrant return?

Yes

Yes

Yes

Supports immigrant return?

Yes

Yes

Yes

 

The winner goes to both Quicktax and H&R Block. If you are preparing a return for Quebec resident or a non resident, you have to use any of these two.

 

 

Aspect 4: In search of best pension split amount:

 

Quicktax

Very good

There is a page you can use to get the best pension split point. Obviously the software has test-calculated many points and picked the number with the best refund. The result is quite good.

 

However, you need to go to the pension optimization page to launch the best pension split search, and if you forget to do it, you lose. This can easily happen if you test try different scenarios.

 

Also, if two spouses resided in different tax provinces, you wonít be able to do the return at all.

 

H & R Block

Good

Some method has been developed to find the best pension split point. For most cases, the bottom line difference is within one dollar. But it does give radical numbers in one of my tests.

 

TaxChopper

Excellent

Some method has been developed to find the best pension split point. In my test, the numbers it presents are always the exact best pension split points. And whenever you forget to put the split amount or the split amount is not the best, you get a warning message.

 

The winner goes to Tax Chopper

 

 

Aspect 5: Service guarantee

 

 

Quick tax

H & R Block

Tax Chopper

Maximum guarantee

Yes

No

Yes

Accuracy guarantee

Yes

No

Yes

Satisfaction guarantee

Yes

No

Yes

 

The winner goes to Quicktax and Tax Chopper

 

 

Conclusion:

My conclusion is that Tax Chopper is the best if you resided in Canada at the end of the year except for Quebec. However, I only tested a few scenarios and your tax situation can be different, so I encourage everybody to shop around and test your numbers using all these three products. They all let you check your final results without purchasing. And once you have finished one product, testing the others will be pretty easy.

 

My tests were performed on Between April 3rd and April 5th, 2010

Quicktax is a registered trademark of Intuit Canada.

Tax Chopper is a registered trademark of CuteTax Inc.

 



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