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Filing Taxes Insights

June 12, 2021

How to pay yourself from a corporation: Management Fees vs Salary

Have you recently incorporated your business? Wondering about how to pay yourself? Stuck between the options salary or management fees? Then read on to get your answer. If you own a business through a corporation you can choose to pay yourself a salary or management fee. Let’s discuss the benefits and risks associated with management fees and salary to reach out for a solution that best suits you. Paying yourself a Salary/ Wage from Corporation If you opt to have a salary from your business, the payments are the expense of the corporation and employment income for you personally. How […]
June 12, 2021

Section 85 Rollover – Tax Fee Transfers

Whether it’s a company restructuring for tax planning objectives or a successful sole-proprietor aiming to incorporate– the Section 85 rollover is a valuable tax deferral tool, used extensively in the Canadian business landscape. If you have decided to transform your existing business into another Canadian entity without having to pay taxes then this blog contains a lot, you need to know!  Purpose of Section 85 Rollover The main purpose of section 85 rollover is to transfer eligible property (with a built-in gain) on a tax-deferred basis from one company (corporation or sole proprietorship for example) to another corporation. Electing to […]
June 12, 2021
Accounting Solutions GTA

RRSP Deadline For 2022 Tax Year

The world of investing for saving purposes can be complicated but it is not necessarily difficult. All it takes is some management and a little advice along the way. Everyone has their own needs and reasons for saving: kid’s education, buying a home making sure to have enough retirement income to last. Whatever your needs, there are different government saving options with different features to cater to your needs, accumulate savings, and encourage smart investments. One of these is the Registered Retirement Savings Plan (RRSP).  What is RRSP? A Registered Retirement Saving Plan (RRSP) is a retirement investment plan system […]
June 12, 2021

How Self-Employed Business Owners pay CPP and EI?

Tax situation of a self-employed Canadian business owner is a bit more complex than that of an employee. So, what is the major difference between being an employee earning a paycheck compared to being self-employed? Well, when you are self-employed there are two areas where you differ from regular employees’ contributions to the Canada Pension Plan (CPP) and Employment Insurance (EI). Who is considered Self-Employed by Canada Revenue Agency (CRA)? There are a ton of various terms for being self-employed. If you are sole-proprietor or a partner of a business, a freelancer, an independent contractor, or even doing Direct sales […]
June 12, 2021

Incorporate Sole Proprietorship (In-Depth Guide For 2022)

Businesses in Canada can take three legal structures: Sole proprietorship, Partnership and, Corporation. Each structure has different and important implications for liability, taxation, and succession. In this article, we will discuss the incorporation of sole proprietorship which means converting a sole proprietorship into a corporation. What is Incorporation? First thing is first– What does it mean to incorporate your business? In simple words, it means separating your business from yourself. As a sole proprietor, there is no separation between you, the owner, and your business. Incorporation is the legal process of setting up your business as a separate entity recognized […]
June 12, 2021

Tax Implications of a Terminal Loss

Terminal Loss Definition by Canada Revenue Agency (CRA) Line 9948 – Terminal loss states that you have a terminal loss when you have no more property in class at the end of a year, but you still have an amount you have not deducted as capital cost allowance (CCA). CCA is the deduction you can claim over several years for the cost of depreciable property, that is, property that wears out or becomes obsolete over time such as a building, furniture, or equipment that you use in your business or professional activities. In general terms, a terminal loss on the […]
June 11, 2021
Canada Disability Tax Credit

Are Sponsorships Tax-Deductible in 2022?

Disclaimer: Before you consider which amount is tax-deductible in Canada and which is not, you need to consider whether the amount under consideration is a business donating some amount to a charity that is registered or if it is a corporate that is entering into a sponsorship agreement with any other entity. In addition to other common goals for profit, companies all over the world also recognize their social responsibility. Over the years, significant new business resources are allocated to these new efforts. Organizations must consider various options and their corresponding advantages and disadvantages. If the company wishes to support […]
June 10, 2021

4 Tax Tips for Sole Proprietors in Canada

Sole proprietors, including store owners, tend to do all the work themselves. However, following the right steps can help you reduce your tax burden. Paying tax on time and filing your reports correctly can help you save money on taxes. Below are some tips to help you file your taxes for a sole proprietorship in Canada successfully. Getting benefits of non-capital  Consider using this method to decrease your taxes if your business has non-capital losses, which means your expenses exceed your revenues. These losses can be used to offset other forms of personal income. Keep in mind that these losses […]
June 10, 2021

5 Tax Loopholes for Small Business Owners in 2022

Small business owners are always looking for ways to save money, and there’s no better time than the present. In order to do this, you need to find loopholes in the tax code that can help you reduce your tax burden. Here are 5 of them so that you can make a plan for next year!   Keep the collected HST  The majority of small business owners are unaware of the HST quick method used by accounting firms. This method allows you to keep a small portion of HST collected in your pocket.  This is how it works. You charge 13% […]