Hi,
I started working on taxes with my wife and our small business. We finished the first portion, our personal incomes and our return showed as being about $2100. When I proceeded to start the small business portion of the return, the listed tax return was instantly reduced to about $600. What gives? I completed the business section and the return went up to $2200. This doesn't make sense. Last year our circumstances were very similar and the return was about $4100 (with an accountant). Did I do something wrong in my return?? Please help.
It’s hard to comment without knowing the specifics of your situation, but it is common for your refund/balance owing to fluctuate as you progress through your return. For example, when your refund dropped from $2100 down to $600, that was likely because you added your business income. Any time you add income, your refund will drop or your taxes owing will rise. Later, when you were finished the business section, your refund went back up – this may be because you added expenses that reduced your business income.
Another thing that may be happening is that the credits that you are eligible may be changing. A common thing is for people to add a small amount of employment income at first, which makes them eligible for the Canada Workers Benefit (CWB) (aka the Working Income Tax Benefit). But then when you add more income (or full time tuition), you no longer qualify to receive the CWB and it drops off your refund.