Last updated: October 13 2010
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If your refund is more like $1500óthe average refund in Canadaóyou'll pay $105 for this: $45 on the first $300 and $60 on the next $1200. This will put $1395 in your pocket instantly. Is that worth it?
Consider the annualized cost of advancing yourself money this way. . .and then some alternatives. Perhaps if you have access to a line of credit or can earn extra income with a second job, you'll preserve more of that tax refund. Or, if you have errors or omissions on prior filed returns, you may be able to recover missed refunds or benefits that will cover costs in the short term.
Your tax advisor can help. The form and sample cost calculations can be found at the following link: http://www.cra-arc.gc.ca/E/pbg/tf/rc71/rc71-10b.pdf
Additional educational resources: Introduction to Personal Tax Course and Essential Tax Facts.