I shove all my receipts into monthly folders and I try to make sure I use only my CC to buy company stuff so that I have only one thing to pay off every month.
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I shove all my receipts into monthly folders and I try to make sure I use only my CC to buy company stuff so that I have only one thing to pay off every month.
I do buy some computer stuff, mileage, cell phone, office 365, some other things. I think it saves me about $200/yr lol.
Mostly I keep the company because virtually all places refuse to deal with sole proprietorships.
pretty easy to write of a few thousand bucks worth of expenses
You have to depreciate most assets which puts a crimp in the pre-tax savings.
The CRA wanted me to CCA a fucking mouse. I told the guy I was talking to to shove it. He let me expense it all in one year.
The govt is best.
So lemme play Devil's Advocate, here.
https://youtu.be/74oGgFTgpI4
If 40% is the number, who would be prepared to drop the contract where they were at about $200k and take a salary of $143k with benefits? Would that feel like a no-brainer decision?
Yup. Because if you were to lay me off in a couple of years that sweet sweet severance + possible EI.
Some of these benefits are a fixed cost… so as compensation increases the percentage will decrease… (employer paid ei, cpp, etc)
A big one is paid days off… 3-5 weeks vacation plus flex days/PLDs… easily at 6 weeks+, then ~2 weeks worth of stats… bonuses, even at a conservative 10% of salary already puts the premium for employees at 25%+ alone… oh and don’t forget a minimum of 5% rsp matching… so 30% plus ~$15k for health benefits and cpp/ei premiums (employer paid part)
These days, every day!
Everyone keeps talking about the benefits of being an employee but seems to be ignoring the benefits of being a contractor. Being about to deduct quite a few things along with splitting profits across future years has a fair bit of value. IMO the gap is def less than 30% figure some people throw around.
All things being equal if you got a 20% bump to switch to contractor you'd probably finish the years ahead all things being equal. Though contractors tend to be the first chopped so there is the job security aspect and why some people expect a larger margin.
(Depends on the companies bonus structure though, obviously if you get a huge yearly bonus that's quite different situation)
Going from being an employee to a contractor. In the same job. Same position. Same company.
There are next to no legitimate business expenses in such a scenario.
Change my mind.
Other than buying a computer, maybe Office 365 and your own email domain not much else.
Yup, you might save $200 on your taxes.