Undergoing a tax review is one of the most frightening and harrowing experiences any adult can endure. A tax review probes deep into financial and personal matters, and if errors and omissions are discovered in tax returns, the result can be imprisonment or a fine, possibly both. More frightening still, the aftermath of tax evasion can be just as harsh for innocent mistakes as serious attempts to defraud the authorities.
When times get tough, money gets tight. And when money is more difficult and expensive to borrow, it’s especially important for small businesses to take steps to ensure that their cash flows keep flowing. Here are five ways to protect your cash flow and help your small business ride out the storm.
Do you like paying too much income tax? Do you pay more than you should? By not taking full advantage of deductions, you may be paying more income tax than you need. Are you taking advantage of every deduction available to you? Do you file your income tax return on time? Do you pay installments quarterly and on time? The following are some of the more common missed deductions that may be contributing to your high income tax bill.
Remember, cash is king, right? Maintaining a smooth cash flow makes your company better, and, perhaps, less reliant on costly outside financing. If your business has an unstable cash flow, then it may have sizable disparities in earnings, and that may escalate the likelihood of default, which harmfully affects a company’s cost of capital. Your company will be of a greater value if it keeps an even cash flow over one that doesn’t. By implementing adequate cash flow management processes, you’ll reduce cash flow volatility.
Income from unincorporated businesses is taxed in the hands of the owners. If you earn income from such a business, you must prepare an income statement each year, showing all the income and expenses of the business. The resulting net profit or loss is then transferred to your tax return and is taxed, along with all your income from other sources. The Canada Revenue Agency (CRA) provides standard business statement forms which it encourages you to use in calculating your profit and loss. However, you are not required to use these forms, as the CRA will accept other types of financial statements.
Cash is king! That phrase is meant to mean that if the cash doesn’t flow into your business, then your business will die. Efficient cash flow management means you are predicting the cash you’ll need at a point in time, no you don’t have to be physic. You can forecast the trends in cash inflows and outflows to determine any potential surpluses or shortages that could occur. You need to maintain a firm control on inventory, how you extend lines of credit, and prudently manage accounts receivable, if you want a smooth cash flow, or would like to increase it. In this article, we’re going to look at the top ten efforts that’ll support you in the above.
As the old cliché goes, the only things inevitable in life are death and taxes; and, they can happen at the same time. Today we’re going to talk about what happens when, as a taxpayer, you die. I think the biggest thing is that people are not financially prepared for death. We know it’s coming, maybe not when, but eventually we pass, and our loved ones are left to deal with your estate. It’s best to talk about it before, have your will, and ensure your wishes are met. And, of course, pay as little tax as possible.
As a business owner, or a telecommuting employee, the design of your home office plays a major role in your productivity. Having a well-organized home office design helps you be more productive as well as more profitable, and accessories are a good place to begin.
Boost your productivity? Have a more successful operation? Picking the right accessories can make a huge difference in your world. These are the six must-have accessories for your home office productivity.
Every business starts with an idea, but not every idea is the basis for a viable business. Choosing the right idea and then transforming it into a successful business is both an art and a science. It is also a complex, convoluted process at which few people excel.
Nevertheless, there are some truly successful serial entrepreneurs. They agree on certain key recommendations. Here are six tips for transforming your idea into a business reality.
Canada Revenue Agency (CRA), our glorious tax collectors, are on a push to go completely digital in the very near future. Part of that has been getting taxpayers to get their refunds via direct deposit, and paying any monies owed via online banking. They’ve also been pushing to get people to apply for My Account, which allows you to track your refund, view or change your return, check your benefit and credit payments, view your RRSP limit, set up direct deposit, and so much more.
It's a widely quoted statistic that eight out of ten business ventures close within the first 18 months. No one sets out in business with the idea of failure, but if you want to avoid becoming part of that statistic, it's vital to know the most common reasons for a business to go under so that you can steer clear of making the same mistakes.
You’ve heard so much about all these people buying stuff in China from Alibaba, and making some money on the side or starting a new business. What you may not realize is that you need an Import-Export account business number in order to do so. You need this account even if you don’t think your sales will be over $30,000. Now, if you’re just buying stuff for yourself then you don’t need to register. We won’t get into how to import goods into Canada in this post.
Entrepreneurs understand that starting a business can be scary but exhilarating at the same time. No matter what industry you're in, getting your business off the ground and dealing with competitors can be difficult. Whether you've already started your business or are about to launch, here are some tips to help your business rise above the rest
We’re getting a little sciencey with this Tidbits post, but don’t worry, we’ll keep it simple (lord knows I need to do that). So what is Scientific Research and Experimental Development (SR&ED) [pronounced ‘shred’] Tax incentive program? It’s a federal government tax incentive program administered by the Canada Revenue Agency (CRA) that encourages Canadian businesses of all sizes, and in all sectors to conduct research and development (R&D) in Canada. It is the largest single source of federal government support for industrial R&D. The SR&ED Program gives claimants cash refunds and / or tax credits for their expenditures on eligible R&D work done in Canada.
Most small business owners and marketing managers remain fixated on their website's ranking in the big search engines. They know that local search helps grow businesses, and they also know that the major search engines have features that attract people who research local companies on the internet. Still, many of these companies cannot enjoy the true benefits of local search because they don't fully understand what it means. In other words, too many marketers don't know how customers are likely to find them online.
Local search does not just mean searches on the largest search engines. By learning how potential customers find information about businesses, marketers can attract more business from shoppers who research purchase decisions with their computers and smartphones. In turn, the businesses should enjoy a better return on their efforts to attract customers from their communities and neighborhoods.
The government back in 2009, figured that first-time home buyers were disadvantaged to those that already had a home, and may or may not be able to get into their first home easily. They developed the Home Buyers’ Amount and on your 2014 and 2015 income tax filing you could claim an amount up to $5,000. I have a feeling this credit will go way of the dodo and disappear in the next couple of years.
You can claim an amount of $5,000 for the purchase of a qualifying home acquired in the prior tax year, if both of the following apply: 1) you or your spouse or common-law partner acquired a qualifying home; and 2) you did not live in another home owned by you or your spouse or common-law partner in the year of acquisition or in any of the four preceding years (first-time home buyer).
Advances in computer technology have made it possible for businesses to be more productive, and to get more done with fewer resources. Investing in a high-performance information technology system can provide businesses across the spectrum with a variety of important benefits, including better sharing of information, more informed decision-making and greater productivity.
You’ve got a great opportunity in another country, and looking at leaving Canada. This can affect you for taxes, as well as retirement, purposes; we’ll only discuss tax purposes. We’ll look at when you are considered a non-resident by Canada Revenue Agency, and what you need to do.
Starting a new business is always a challenging experience, particularly if it's your first business venture. Fear of failure and financial worries can cause added stress, but your chances of success are greatly increased by choosing the right business idea. If you haven't yet decided on the type of business you want to run, answer these five questions to help you choose the right idea.
It’s come to that time of year again, Summer! For a kid, the greatest time of the year with no school and a chance to hang with friends. For a parent, a slow agonizing death. Okay, maybe not that, but it can be a pain for parents as the kids are always ‘bored’. So, many parents send their kids off to camp for a least a period during the summer. For many parents this can be a big expense, however, there is some relief from the government in the form of a tax deduction.
Summer camps fall under the Child Care Expenses Deduction, on form T778. This includes day camps and day sports schools where the primary goal of the camp is to care for children (an institution offering a sports study program is not a sports school); or boarding schools, overnight sports schools, or camps where lodging is involved.
Congratulations! You've worked hard, set up your own business and now you are your own boss. You're enjoying the rewards of a great income as fruitage of all your well-spent time, energy, and money. There's just one thing missing. What about time off? Not just a day here or a day there. What about a real vacation? How can a solopreneur like yourself actually take a vacation away from business?
Here are some important thoughts to consider before deciding whether you should or should not step away from the demands of your business, whether it's online, offline, or a mix of both.
Investors tend to be delighted by a winning year in the markets until they get clobbered by a big income tax bill. While taxes aren’t completely avoidable, there are a number of strategies you can use to minimize them.
You can save money on your taxes by carefully considering the type of investment you purchase, the times when you buy or sell it, and whether you hold it in registered (RRSP or TFSA) or non-registered account. By saving money on your taxes, you increase your total returns. Remember, though, that you’re in the market to make money. Never let tax considerations keep you from selling a stock whose best days are over.
When dealing with matters at work, most people would likely say they try to handle things with a professional, mature mindset. However, it could be possible that this highly structured way of trying to manage things could be stifling the creativity and more erratic thought processes that could be used to create a stand-out business model.
In 2013, the government decided to give an extra credit to those who are donating for the first time, or hadn’t donated for quite a few years. This was done in order to encourage people to donate to charities, and allow charities to do more for the people, rather than government doing everything for them. At least until 2017, then who knows if this credit will exist at all.
Back in the days of pink bubblegum and hula hoops, a junior high school kid from a rural neighbourhood was contemplating ways in which to invest and earn money. In due course, he followed his yearning with a very shrewd action. With his entrepreneurial spirit intact, he bicycled down to the small, rural town’s local general store and bought up the town’s entire supply of pink bubblegum. In turn, he made continued attempts to resell the pink bubblegum to kids in the neighbourhood hiking the price to allow him to realize a profit.
Well, the other neighbourhood kids understood the concept of price gouging and were not receptive to purchasing pink bubblegum at inflated prices. Suffice it to say the idea went over like a lead balloon. Though the kids suffered a week-long withdrawal from chewing pink bubblegum, they effectively boycotted sales by the entrepreneur and in no time at all prices and supply returned to normal. In fact, the whole affair ended with the entrepreneur apprehensive to depart his parent’s home for weeks after being branded the town traitor who created the bubblegum famine in the first place.