A word of caution about the change in tax refund payments.
A word of caution about the change in tax refund payments.

The Ontario Government has been changing the way that it pays out refundable tax credits from one lump-sum payment to cheques issued throughout the year.  Most people with lower income in Ontario are eligible to get money back when they file their income tax return from credits like the Ontario Energy and Property Tax Credit and the Ontario Sales Tax Credit.


In years past, these amounts were paid as a lump-sum refund (which could also include federal tax credits and refunds on taxes paid on work income).  Many people would file their income taxes as early as possible using a tax preparation company and get an upfront payment from that company (less their fee) equal to the estimated refund.  For many low income people, that money was used to pay for Christmas presents or winter clothing or to get caught up on bills early in the New Year.   


With this change in the way credits are paid out, that lump sum refund at tax time may be much smaller or nonexistent.  Instead, some of the credits have already started to be paid out at different times of the year, and as of July of 2012, all the credits will be bundled together and will paid out monthly as the Ontario Trillium Benefit.  


The change is meant to help low income Ontarians by making this money available to them throughout the year, rather than having to wait to the end of the year.  But it is having unintended consequences as well.


Some tax preparation companies are changing the way they do business around the filing of tax returns.  With no lump sum refund coming to their clients, these companies have asked their customers to sign up for a “bank account” (owned by a cheque cashing company) and to change their direct deposit instructions to Canada Revenue Agency to have all their future tax credits and tax-delivered benefits (including the HST credit, the Ontario Child Benefit, the Canada Child Tax Benefit and the NCBS) directed to this account.  Once money starts flowing into this account, the tax preparation company takes their fee for the preparation of the return, and another fee is taken out for the debit card that is needed to access the account.  Then there are additional $2.00 fees for using the debit card for almost every transaction including buying something, taking out cash from a bank machine (other than their bank machine), and even making inquiries about your account.  There is also a monthly fee for the bank account itself.  Those fees could really add up in the long run.


It’s a bit of a catch-22, because everyone needs to file their income tax return to be eligible for these credits.  However, there are other options to filing your return which many people don’t know about.  For example, there are free tax preparation clinics for low income people run by community agencies, like Seniors Home Support in Renfrew area and Carefor in the Pembroke region.    In addition, people with simple tax returns may be able to use the Canada Revenue Agency’s Telefile service to file by telephone. 


If you have already signed the papers to agree to open this type of “bank account” and later change your mind, The Consumer Protection Act gives you the right to cancel any contract within 10 days of receiving a copy of the papers you signed.  If it is has been more than 10 days since you received your copy of the contract, you can contact the Renfrew County Legal Clinic (613-432-8146 or 1-800-267-5871) for advice or speak to John Yakabuski’s office if you have other concerns.




What Can the Clinic Do For You?


The Clinic provides free legal services to residents of Renfrew County who face economic limitations, it acts as a resource to groups that help lower income residents, participates in law reform, provides speakers and educational material on subjects relating to legal problems of lower income residents and provides legal advice over the phone when possible.


The Clinic Staff can help you with the following matters:


  • Social Assistance (Ontario Works, Ontario Disability Support Program)
  • Landlord and Tenant (Tenants only)
  • Employment Insurance
  • Canada Pension Plan
  • Workplace Safety and Insurance Board Claims
  • Human Rights and Employment Rights
  • Debtor/Creditor - Small Claims Court matters
  • Criminal Injuries Compensation Board Claims
  • General Legal Information
  • Assist in Community Development


How Does the Legal Clinic differ from Legal Aid?

There is often confusion between legal aid and legal clinics. Legal aid and legal clinics are both funded by Legal Aid Ontario. They are both designed to ensure that low income people have access to justice by providing legal services that help people to access their rights under the law, even if they can't afford to hire a lawyer.


Legal Clinic:

The Legal Clinic provides help in areas of law not covered by Legal Aid.  The Legal Clinic's services are always free, though you are expected to pay for disbursements if you are able. For full services you must meet the Legal Clinic's Financial Eligibility Guidelines. Services are provided by the Clinic staff.


Legal Aid:

Legal Aid provides certificates which may be accepted by private bar lawyers who have agreed to do so.


  • Areas of law for which a legal aid certificate may be given are:

             Criminal charges

             Family law

             Immigration and Refugee claims

             Mental Health hearings

             Some other matters. 


  • Whether or not you receive a legal aid certificate usually depends on your income level and the area of law. Sometimes Legal Aid will ask you to sign a payment agreement or will place a lien on your home to pay back part or all of your legal fees.  


Legal Aid Client Service Centre

Call toll free to 1-800-668-8258 to make an application for legal aid.

Website: www.legalaid.on.ca 



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Renfrew County Legal Clinic