Debt reduction was cited as the leading use of tax refunds among respondents participating in a national survey conducted for the Chartered Professional Accountants of Canada (CPA Canada).
Forty-four per cent of the more than one-thousand individuals surveyed indicated they received a refund after filing their taxes for 2012. The survey, conducted in early May, asked participants receiving money how they would use the largest portion of their tax refund.
Twenty-eight per cent of those receiving a refund said it would be used to pay down debt. The next two most popular uses were putting it into savings or investments and using it for day-to-day expenses, both cited by 18 per cent of respondents.
Other tax refund uses referenced by respondents included using it for home improvement/renovation (12 per cent), a vacation (seven per cent), a child's education (five per cent), a treat by spending it on entertainment, a meal, personal care, clothing or other non-essential purchases (four per cent) and putting it toward a large purchase such as a television or automobile (two per cent).
When asked if they normally plan in advance on how they will use their refund, 46 per cent of respondents said yes, while 38 per cent said they do not plan in advance. Eighty-eight per cent of respondents said they keep their tax receipts organized throughout the year so they are ready when the time comes to file a tax return.
Money worries also continue for Canadians. When asked if they worry about money, 52 per cent of respondents agreed with the statement while 39 per cent disagreed.
The 2013 CPA Canada Tax Refund Spending Survey was conducted by Harris/Decima via telephone between May 2-6, 2013, with a national random sample of 1,006 adult Canadians aged 18 years and over and is considered accurate to within ± 3.1 per cent, 19 times out of 20.
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