Incorporating?

[heavyfuel]

Originally posted by UndrgroundRider
The corporation needs to complete and file a T5. This reports to the CRA and to the shareholder the amount of dividends they received, the dividend tax credits available and whether or not they are eligible or non-eligible funds.

The shareholder then reports this income on line 120 and 121 of their T1, and the tax credit on line 41 of schedule 1.

Better be making a mil+ yearly to involve such complicated bullshit

[Big Daddy G]

This is probably a good place to ask this.

I'm looking at potentially incorporating, and wanted to get a referral or two for an accountant.

PM if you have a good one!

thanks

[whatthe]

I can likely set myself up to not be PSB, but I would like to talk someone experienced as to what steps need to be taken. Compare it to what I want to accomplish and see if it is worth it. Any recommendations would be appreciated as well.

[Sugarphreak]

...

[garnet]

sounds like someone trying to take advantage
in my first year, i claimed something like $13K in tools, equipment and supplies/consumables for work only use
but then it was getting started, so after everything, i ended up owing only $700...but i never got an audit (flagged), then my next 2 years were much lower, so i guess they expected that to be at my start

i could be wrong, but i thought i read somewhere that only in the first 3 years/periods, that a business could claim a loss consecutively, then only every so often afterwards
it makes sense to not be allowed to claim a loss every year, or frequently for your small business

i remember being afraid of being audited should i claim a loss (on paper) in my first year, so i actually left some expenses unclaimed, just so i would owe a little bit LOL

[UndrgroundRider]

Originally posted by garnet
sounds like someone trying to take advantage
in my first year, i claimed something like $13K in tools, equipment and supplies/consumables for work only use
but then it was getting started, so after everything, i ended up owing only $700...but i never got an audit (flagged), then my next 2 years were much lower, so i guess they expected that to be at my start

i could be wrong, but i thought i read somewhere that only in the first 3 years/periods, that a business could claim a loss consecutively, then only every so often afterwards
it makes sense to not be allowed to claim a loss every year, or frequently for your small business

i remember being afraid of being audited should i claim a loss (on paper) in my first year, so i actually left some expenses unclaimed, just so i would owe a little bit LOL

The CRA has certain criteria that flags individuals/businesses for audits. I assume this is probably a scoring system based on a weighting of multiple factors. You don't have to worry about this if you have a solid paper trail and everything is above board. A professional accountant can help you with this.

[l/l/rX]

Anyone have any recommendations for insurance providers? I'm looking for $2mill in liability. I would like to get a quote first.

[signal_11]

Originally posted by l/l/rX
Anyone have any recommendations for insurance providers? I'm looking for $2mill in liability. I would like to get a quote first.

Encon is small-business friendly:
http://www.encon.ca/Pages/EnconWelcome.aspx

[b_t]

for what its worth, I just switched to being a contractor and my nominal tax rate ended up being slightly higher than it was when I was an employee. unless I am really diligent with my expenses, I will end up paying more taxes - and in the end I will have to pay most of the difference to my accountant anyway, and considering the whole thing is a ten thousand times bigger pain in the ass than just getting paid, I wish I had not gone this route.

[bspot]

Originally posted by b_t
for what its worth, I just switched to being a contractor and my nominal tax rate ended up being slightly higher than it was when I was an employee. unless I am really diligent with my expenses, I will end up paying more taxes - and in the end I will have to pay most of the difference to my accountant anyway, and considering the whole thing is a ten thousand times bigger pain in the ass than just getting paid, I wish I had not gone this route.

You're doing it wrong, or making several hundred thousand a year.

[Sugarphreak]

...

[b_t]

Originally posted by bspot


You're doing it wrong, or making several hundred thousand a year.

I'm doing it in a way that gives me absolutely nothing to worry about in case I was ever audited.

If I played fast and loose with the rules and claimed things I am not really entitled to (ie. small business credit, writing off housing expenses even though I have no use for a home office, vehicle expenses) I could easily save a ton on my taxes, but then if I got audited I would be boned.

FWIW the stuff posted about salary vs. dividends was pretty valuable, so that at least will save me a lot on CPP contributions. So that's not bad.