You have worked hard to establish a business in Canada. Kudos to you! Now comes the most stressful part of an entrepreneur’s life- taxation. It is needless to say your business is subjected to taxation irrespective of its size once it is opened and registered in Canada. Professional tax filing accountants can guide you through the specific laws you must follow. Besides that, you should also have a clear idea about the basic tax situation in Canada for small businesses.
Entrepreneurship gives you the freedom to work at your will. You are your boss. But, it is also a matter of various serious responsibilities. Taxation is one of them. Here is a thorough guide for you to be ready for taxes for entrepreneurs-
Handling taxes on your own is time-consuming. Wouldn’t you instead use that time to make important business decisions? Experienced tax professionals are trained in this field. They can help you manage taxes and income without any hassle. They also inform you about the areas to spend and how to spend for maximum profits in the future.
Managing taxes is as smooth as butter when you can keep track of your money. Start keeping track the moment you start making income through your business. CRA looks for appropriate receipts while conducting audits. Thus, you are most likely to be in a safe position if you have the receipts ready for the past six years.
This tip is especially beneficial for entrepreneurs with children of post-secondary school age. You can split your income with a family member who has a lower income. This powerful tax strategy helps you reduce the marginal tax rate on your income. The marginal tax rate is directly proportional to your income.
Splitting income should be reasonable. The salary you pay should be worth the services that the employee provides.
New business registration is an essential part of running a successful business in Canada. Go for it if your business has grown in the past years. Whether you are in Saskatchewan, Alberta or Manitoba, you must consult with experienced tax filing experts to incorporate your business.
You are eligible for tax breaks if you incorporate your business in Canada. Thus, your business will be taxed at a reduced rate upon qualification. However, you should have enough money to manage the costs of incorporation.
Are you working from home after the pandemic? Then you can claim a certain amount of household expenses. The expenses include home insurance, rent, mortgage interest, etc.
The eligibility criteria are:
You can talk to tax filing professionals to know if you’re eligible to make the claims.
Taxation is complicated, But you can’t avoid it either. Thus follow the above-mentioned tips and be tax-ready for the season. Learn the tax laws in your area and then proceed accordingly.
Run your business efficiently with Border Bookkeeping by your side. We have a network of experienced accountants and bookkeepers to manage all your accounting needs. Our tax accountants equip you with the updated tax laws in Alberta, Saskatchewan or Manitoba. We make sure you get your taxes done on time with zero hassles.