Starting Your Own Business – Sole Proprietorship, Partnership or Corporation?

By Randall Orser | Small Business

Once you have decided to take the plunge and start your own business, the next step is to decide upon the structure of your business.  In Canada, there are three kinds of business structure. Sole Proprietorship (one owner), Partnership (2 or more owners), and Corporation.  

With a sole proprietorship, you would be fully responsible for all debts and obligations related to your business and all profits would be yours alone to keep. As a sole owner of the business, a creditor can make a claim against your personal or business assets to pay off any debt. 

A partnership is a good business structure if you want to carry on a business with a partner and you do not wish to incorporate your business. With a partnership, financial resources are combined and put into the business. You can establish the terms of your business with your partner and protect yourself in case of a disagreement or dissolution by drawing up a specific business agreement. As partners, you would share in the profits of your business according to the terms of your agreement. If you wish to share profits or losses with your spouse, then you must form a partnership; CRA will not allow a split of profit or losses otherwise.

Another type of business structure is incorporation. Incorporation can be done at the federal or provincial/territorial level. When you incorporate your business, it is considered to be a legal entity that is separate from the shareholders. As a shareholder of a corporation, you may not be personally liable for the debts, obligations or acts of the corporation. When making such decisions, it is always wise to seek legal advice before incorporating.

Buy Assets for Your Business Now to Take Advantage of the Capital Cost Allowance

By Randall Orser | Small Business

As we’re coming up to the end of the year, it’s time to think about year-end. Even if you have a fiscal year-end other than December 31st, this is still something to think about. You’re probably looking at buying a new piece of equipment, or furniture, or such and wonder when I should buy such items. Now or at the beginning of the fiscal year? 

I say buy assets when you actually need them, and just a bit before so you have them ready to go when production gets ramped up, they’re ready to go. You might need to add a new computer for new staff or just figure it is time to upgrade (I like to upgrade my laptop every 4 years). You should be proactive in your asset purchases so that you’re not running into a lag time as you don’t have the asset ready.

For tax purposes, it’s always better to buy them before the year-end and get them ready to function. Why? The half-year rule that Canada Revenue Agency (CRA) has in place for asset purchases. Let’s say your fiscal year-end is December 31st, and you need new computers. If you wait until January to buy them the half-year rule applies and for that whole year you only get to write off a percentage of ½ that asset. If you buy it in, say, November, the ½ year rule applies, but then you still get the capital cost allowance on ½ the amount then the next year on the full amount. 

If you’ve just started your business this year, then the CCA is prorated based on when you started the business. For example, Jane starts a business on June 1st and her first fiscal period ends on December 31st. She calculates her CCA to be $3,500. Since Jane’s fiscal period is only 214 days, the amount of CCA she can claim is limited to $2,052 ($3,500 × 214/365).

As your business grows and you need equipment, etc. it’s always best to buy assets as you need them and not worry about depreciation expense. Not buying something could actually end up hurting your business as it could slow down production or your productivity.

Some Less Common Tips for the Small Business Owner

By Randall Orser | Small Business

Being aware of your competition is important to every entrepreneur. Competitors are everywhere and come in all shapes and sizes. Some are immediately recognizable, and some may be just sitting back and watching your progress. Some may be huge multi-national organizations who want to make sure that they retain their market share.  You need to develop a competitive edge to keep you in the game and to achieve your goals, here are some ideas. 

Put Yourself in Their Shoes 

Some businesses do not take the time to make themselves familiar with their customers and their needs.  A customer may have a long history with a company, so the business does not take the time to discover how this relationship can be improved and made more profitable for both parties. 

Do not let that happen in your business!  Continually place yourself in your client's shoes. Find out what you can do to improve your business relationship. If you give your client suggestions and alternatives that will improve their business, they will be most likely to support your business.  Looking at things from the client's perspective will also help you to detect anything that could cause issues down the line. 

Your Team Is as Important as Your Plan

A great business plan is essential to your success as are smooth operations.   These provide the blueprint for your business and should be utilized as checks and balances to make sure that your company is progressing as planned. 

Some business owners can get over-confident and may start to cut corners by hiring poorly qualified staff who do not follow company procedures. This can do a lot of damage to your company’s reputation and relationships with your customers resulting in a loss of business. 

Well qualified and well-trained staff are a crucial part of your business. They understand the company and work to maximize every opportunity to improve your business.  In addition, savvy specialists can help you to create new ideas and refine your procedures. 

Not All Clients are Worth it 

The mission to find more customers can drive entrepreneurs crazy, not because they are difficult to find but because they can turn out to be more of a liability than an asset to your company. 

Clients who are hard to deal with or request difficult or impossible things from you, can make you feel that the income from these people does not justify the amount of time and effort put in to work with them.  Usually you're right - customers that cause difficulties for you or your employees are best left to other companies. If you lose these customers your workers and you will be less stressed.

In addition, staying away from troublesome customers can help your business’s image. Positive company values will increase your reputation with clients and prospective clients and you will be seen as a good company to do business with.

Understand and Nurture a Good Company Culture 

All companies need to have policies in place regarding the standards of behavior expected from their employees, usually in the form of a company handbook given to new employees. Always be aware of any issues arising concerning your employees and understand how to solve conflicts that may arise. An encouraging working environment is important for the happiness of your employees and the success of your company.

Always Tune in to Your Customers 

Entrepreneurs can be become totally absorbed in their own ideas for their products and their company.  They may not appreciate criticism as they believe that they know best. However, they are not looking at things objectively, it is important to be flexible and to listen to your customer. You need to respond to any requested changes and to what your customer really wants rather than what you think they want.  Be open to input from others, tune into your clients and work with them to satisfy their requirements. 

Plan Ahead for Growth 

Getting to a point in your business where your growth has outstripped your projections is a fantasy for some entrepreneurs. Unfortunately, this can mean that they are not prepared when they do achieve success.  It is like winning the lottery, they may have huge plans, however the majority of these plans are not feasible.  You can't wing your way through expansion you need to be ready by making plans at an earlier date. 

You need to consider what expansion means to you. For example, does it mean moving to a different location, and if so is this convenient for your employees and customers?  All companies need to develop a framework and procedures for future expansion. It's never too soon to get ready for a splendid future! 

Market Size Matters 

Financial specialists and investors who are an important part of any business which is looking for capital, are not as worried about what your business does, as they are with the benefit potential. 

They need to know how much of a market share you could get, and that will determine how much they will agree to put resources into your company. Your projections may be fine and dandy, but you need to able to prove that your business has amazing potential in order to raise capital. 

Remember that company size is relative. The more specialized you are, the greater chance that you will have of gaining a bigger market share in your field. If you are a big fish in a small pond you will not have to work so hard to gain clients and be successful in your venture. 

Whenever Possible, Focus on Timing 

Numerous companies have bombed due to poor planning. A good business plan can be difficult to do but is very necessary.  For example, you may already have a lot of clients, but it is easy to lose them, so you need to make sure that your advertising and marketing is continually attracting more.  Your initial business plans may need to be revised as your number of customers increases. Make sure that you are reading your financial reports regularly so that you are always prepared with the information that you need to make changes. 

These are not the most important things that you will need to do to succeed, but they can be a helpful addition to the information you may already have.  It is not easy to start and run your own business, yet it's not impossible. Continue to be aware of your competition and how it may be affecting your business, and search for ways in which you can improve your own operations.  Having your own business can be difficult and unpredictable at times, yet it can be justified by the rewards and the satisfaction that you achieve.

 

Avoid These Common Mistakes When Claiming Charitable Contributions

By Randall Orser | Personal Income Tax

Donating to a charity can be a very feel good experience; as well it can help on your taxes by reducing how much you pay. However, most people make some pretty common mistakes when either donating or claiming the donations on their personal tax returns. We’ll do our best to enlighten you on what to avoid when claiming donations.

Each Spouse Claims Only Their Donations

This is the most common mistake most taxpayers make, each claiming only their donations. As a married, or common-law, couple you can combine your donations. This allows one spouse to take advantage of a higher deduction, or maybe they benefit far greater than the other spouse claiming the donations. Whose name is on the donation receipt is irrelevant. 

You get a higher deduction when claiming more than $200 in donations. On the first $200 of donations you get a 15% tax credit, and the amount over $200 you get a 29% tax credit.  

For Example, Susie has $50 in donations while her husband, Eric, has donations of $190. Separately, they are under the $200, and Susie would get a tax credit of $7.50, while Eric would get $28.50. If they were to combine these donations, one would be claiming $240 in donations. The credit would be $30 ($200 x 15%) plus $11.60 ($40 x 29%) for a total of $41.60. If Eric were to claim the donations he’d get an addition $13.10, and, if Susie were to claim them she’d get an additional $34.10. This may make more of a difference on either’s tax bill depending on their income.

No Receipt For The Donation

This is a common one for people who drop coin or bills into the boxes and cans strewn throughout their city or town. This may add up during the year, however, without a receipt or other proof, you probably won’t get away with the deduction. 

This also occurs when you get people coming to your door, and asking for a donation. If it’s a legitimate charity, you will get a receipt right there and then.

What are donation schemes and why should I avoid them?

People are sometimes approached to donate to charities or other qualified donees through tax shelter arrangements. Before you decide to donate in this way, you should be aware of the risks associated with participating in certain tax shelter donation arrangements including:

  • Gifting trust arrangements;
  • Leveraged cash donations; and
  • Buy-low, donate-high arrangements.

Promoters of such shelters must obtain a tax shelter number from the Canada Revenue Agency (CRA). The CRA uses the tax shelter number to identify the tax shelter and its investors, but offers no guarantee that taxpayers will receive the proposed tax benefits. 

The CRA reviews all tax shelters to ensure that the tax benefits being claimed meet the requirements of the Income Tax Act. The CRA has audited many of these gifting arrangements. Generally, the CRA reduces the amount of the tax credit to no more than the taxpayers' cash donation, and in many cases it is reduced to even less than that. In some cases the credit is reduced to zero. The CRA may also charge interest and penalties.

I have found that when these kinds of schemes go to court, CRA usually wins. I know someone who was caught up in the art scheme some time ago, where you buy a piece of art for cheap and then donate it to a charity at an inflated price (usually way above fair market value). 

What types of gifts qualify for charitable tax credits? 

Examples of donations that do usually qualify for charitable tax credits include:

  • Money;
  • Securities;
  • Ecologically sensitive land;
  • Certified cultural property;
  • Capital property;
  • Personal-use property (such as prints, etchings, drawings, paintings, sculptures, jewellery, rare folios, rare manuscripts, rare books, stamps, and coins); and
  • Inventory (such as art, antiques, rare books).

The following do not usually qualify for charitable tax credits: 

Contributions of services, such as time, skills, effort;

Certain admission fees to events or to programs (e.g., fees for daycare or nursery school facilities);

The purchase price of a lottery ticket or other chance to win a prize, even though the lottery proceeds benefit one or more charities; and

  • The payment of tuition fees (exceptions exist). 

These common mistakes for charitable donations can end up costing you quite a lot in taxes. Always make sure you get a receipt, look at the best possible scenario when it comes to deducting charitable donations, and don’t fall for the schemes that may save you initially but end up costing you way more later on.

 

Before You Start Your New Business, Ask Yourself These Five Vital Questions

By Randall Orser | Small Business

You've chosen, you can hardly wait one more year to experience your fantasy. You long to work for yourself and run your own particular organization. You have a business thought and you're prepared to run head-long down the way to entrepreneurial flexibility. Before you bind up your sprinters and leave upon your voyage: you have to pose a couple of extreme inquiries first, sit yourself down and confront the accompanying five inquiries. Without the correct answers, your entrepreneurial dream may need to pause. 

ls Your Business Idea Viable Over the Long Term? 

Having a thought for another business is extraordinary. Understanding whether you can transform that thought into a beneficial long-haul business is very another story. Talk about your idea with loved ones; ask for ruthlessly genuine criticism. You have to know whether they can see themselves utilizing your business for quite a long time to come or in the case of acquiring from you would be a one-shot arrangement. On the off chance that you have to continually discover new clients, the continuous obtaining expenses may make your organization an Iess-than-beneficial wander. 

By what means Will You Acquire Customers? 

Since we're discussing obtaining costs, how would you intend to attract clients to your business? Is it accurate to say that you are trusting they’ll just normally discover you by means of their most loved web index? Is it true that you will utilize web-based life, and assuming this is the case, which stages will you utilize? Client obtaining is one of the hardest difficulties business people confront, everyone from corporate CEOs to startup organizers under-gauge exactly how tiresome it tends to be to persistently chase for new clients (it doesn't mind keeping the ones you have). Without a practical and reasonable arrangement to attract clients to your organization, your business may be dead in the water before it is even begun. 

Would you be able to Afford Legal Costs? 

It's a troublesome subject to confront, however securing your business legitimately is only one of the difficulties of maintaining your own business. Consider the possibility that a client is unsatisfied with your item or administration offering and chooses to make legitimate move. Is it true that you are ensured? Would you be able to manage the cost of the essential protection premiums to guarantee your organization is secured? From a flawed item that makes hurt a patent encroachment claim., there are various difficulties that could possibly come your direction. Having proper legitimate guidance and protection scope is essential on the off chance that you need to assemble a business that keeps going. 

Where Will You Build Your Business? 

Choosing whether you will run your organization out of your home or by means of a place of work is another test you will confront. In the event that you maintain an online-just business, what are the assessment suggestions in your neighborhood ward? On the off chance that your organization offers returns of physical merchandise, which return address will you offer for your organization? Odds are great you would prefer not to offer your place of residence on your organization site. Will a mail station box address do the trick? Do you have to rent a brick-and-mortar customer facing facade for your organization? Picking between maintaining an online business versus an organization with a physical address client can visit is only one of the arranging choices you need to make. 

Who Will You Turn to for Business Advice? 

Mentorship is a basic segment of business building. You'll confront numerous hard choices as you endeavor to develop your organization. Knowing ahead of time who you'll swing to for business directing is critical. Will you procure a business strategist, and would you be able to bear to do as such? Will you swing to different entrepreneurs who have manufactured fruitful organizations in your division or would you fear them taking your thoughts? In case you're depending on loved ones to offer business exhortation, they may abstain from giving you the hard realities just to save your sentiments. Business mentorship is an imperative piece of growing an organization; you have to confront this choice. on the off chance that you need to guarantee business stresses don't contrarily affect your wellbeing and prosperity. 

Building your own business is an outstanding choice. Not alI have the chutzpah important to put their future hanging in the balance. On the off chance that you need to guarantee your entrepreneurial dream doesn't turn into a living bad dream, you have to put forth a couple of intense inquiries initially Are you prepared to experience your enthusiasm and assemble your own organization?

Tax Implications of the New Pot Legalization

By Randall Orser | Small Business

The government discharged its 2018 spending plan on Tuesday and with it, more subtle elements on how lawful cannabis will be burdened. 

The financial backing reaffirmed plans to apply an extract obligation on cannabis, however affirmed that not all cannabis items will be influenced. Low-THC cannabidiol oils and other low-THC remedial items will for the most part not be saddled, as per the financial plan. Doctor prescribed medications got from cannabis additionally won't be burdened. At the point when cannabis is burdened, the expense will apply to governmentally authorized makers, and will be either a level rate on the amount of cannabis in a given item or a level of the deal cost of a pot item – whichever is higher. 

Along these lines, this could imply that cannabis will be saddled at $1 per gram, or 10 for every penny of an item's value, whichever is higher – as per an understanding came to with most areas in December 2017. The main holdout is Manitoba up until this point. Back Minister Bill Morneau said that the administration's first worry with cannabis sanctioning is securing Canadians. 

"My approach is to ensure that the tax collection of cannabis is predictable with the objective of keeping cannabis out of the hands of children and out of the bootleg market. That implies keeping the duties low so we can really dispose of the lawbreakers in the framework." 

In any case, Dan Kelly of the Canadian Federation of Independent Business isn't sure that the expenses are sufficiently low. 

"While it's unquestionably reasonable amusement for the legislature to impose these items, the stress obviously is whether you don't get the tax collection levels precisely right, it invigorates the underground economy." 

"Many have recommended that the level of tax collection that is being proposed would imply that the over the ground cost will be higher than the underground market cost and that may energize and fundamentally keep the business subterranean." 

He stresses that the administration is endeavoring to snatch excessively in impose and all things considered, probably won't accomplish its objective of bringing cannabis out of the underground economy. 

"I figure a more astute procedure is begin with an exceptionally sensible level of tax assessment to guarantee that we get the business over the ground before we begin tightening it up," he said. 

Cannabis is relied upon to be authorized this late spring, yet the national government has faltered on the particular date. The national government will keep one fourth of the income from the extract assess and the regions will get the rest. In any case, if the government's offer is more than $100 million a year, the areas will get the overabundance. 

The government expects that the territories will exchange the vast majority of this money to regions, who the government says are "on the cutting edges of authorization." 

The financial backing does not anyway say how much income it anticipates that these expenses will create. For at any rate the initial two years, the central government won't have the capacity to keep more than $100 million every year on account of their concurrence with the areas, however there are no appraisals on the aggregate size of the pot. 

The legislature will likewise put resources into a state funded training effort to enlighten Canadians regarding the dangers of weed utilize. 

Tending to the opioid emergency 

The government is intending to put $231.4 million more than five years in battling the opioid emergency. The greatest offer of that, $150 million, is a one-time crisis venture to enhance access to treatment programs. 

A portion of alternate measures will help outskirt protects better distinguish approaching shipments of fentanyl and enhancing general wellbeing information on the opioid emergency, however it doesn't give specifics on both of these measures.

A wide range of cash 

At each level, developing monetary action, or total national output (GDP), converts into government income. Customer facing facades will pay metropolitan charges. Rustic creation and storerooms pay property charges. Organizations pay imposes on benefits. They likewise pay permit expenses. 

Since Ontario has assigned Shopify as the administration's business stage, cannabis cash will go into new innovation. The new lawfulness of the medication, anticipated that would be legitimate next summer, will probably goad more innovative work on medicinal utilizations for weed, its subsidiaries and analogs. 

What's more, that is also cutting the cost of capturing and imprisoning individuals criminalized for cannabis utilize. 

In spite of persistent endeavors to gauge how much pot Canadians devour, Statistics Canada has not discharged a projection of the aggregate post-legitimization estimation of the business. The parliamentary spending officer (PBO) has assessed the aggregate effect of household deals on the economy will be like that of the brew showcase. 

The OECD, the rich nations' research organization, says Canada gathers just shy of 32 for each penny of GDP in assessments of various types. Along these lines, if the PBO gauge of a conceivable $6-billion knock to GDP from the household cannabis industry is exact, add up to government income could be as high as $2 billion, significantly more than the $1 a gram got ready for the extract impose. 

Wiping out rivalry 

Obviously, a portion of that cash would as of now be streaming into government coffers in light of the fact that illegal income additionally advances into the legitimate economy. Making precise computations is troublesome, however approach investigator Rosalie Wyonch says the lawful pot assess income from such things as business and salary duties will be huge. 

"We can state that it's more considerable than the extract charges," says Wyonch, who has composed strategy counsel on legitimate pot for the C.D. Howe Institute, a Canadian research organization. 

She says one of the key things’ governments can do to expand income is to keep costs low, in any event for the initial couple of years, to enable wipe to out the unlawful rivalry. She says the higher the legitimate costs, the more business will be left in the hands of the unlawful market.

With the legalization of cannabis, the Canadian government and its provinces should enjoy a huge influx of cash as the industry catches up to demand and people are willing to purchase their pot legally. If this is done right, and the government doesn’t get overly greedy, we could cash-in on this booming industry.

Now that Pot is Legal, Start Your Cannabis Business the Right Way

By Randall Orser | Small Business

Is it accurate to say that you are hoping to cut out a bit of the cannabis business for yourself? Nobody can point the finger at you, there is by all accounts boundless potential for making immense benefits in this segment, one of the quickest developing on the planet, as per statistical surveying firm Arcview. Information from the 2016 Cannabis Business Factbook appeared around 90 percent discount cultivators., recreational cannabis stores, and imbued item organizations - the three mainstays of the weed exchange - were either equaling the initial investment or tun1ing a benefit. Among those, percent of imbued item organizations and 29 percent discount producers depicted their organizations as very gainful. 

The potential market is gigantic; therapeutic weed is legitimate now and recreational cannabis will be in October 2018, which implies Canada is open for business with regards to cannabis; however, a few Provinces will no uncertainty endeavor to demolish it. 

The business development, in the United States, has been similarly as amazing: $6.7 Billion of every 2016, a 30 percent expansion from the earlier year, and about $10 billions of every 2017. Arcview ventures that deals will hit $20.2 billion by 2021, which works out to an eye-popping yearly compound development rate of 25 percent. Inevitably, weed could match brew in deals, as indicated by the 2018 Cannabis Business Factbook.

In spite of these salivation prompting figures, a tangle of befuddling controls, high assessments, and different obstacles anticipate planned financial specialists. To win and flourish, this is the thing that you have to do.  

Concoct a Unique Idea 

Much the same as in some other industry, having a one of a kind thought that fills a neglected need is basic for progress, that implies you have to do your exploration to get the bits of knowledge you have to produce appropriate thoughts and decide the division of this energetic industry that is justified regardless of your chance and cash. 

Most planned weed specialists ordinarily incline toward dispensaries and develop tasks; However, these two parts are, less secure and all the more firmly managed; subsequently they are less gainful. Edges are probably going to fall further as the lawful utilization of cannabis rises and prompts expanded rivalry. 

This is the reason you have to come up an interesting business thought. It is safe to say that you are a foodie? Think about putting resources into a line of consumable items. Is accommodation more your speed? Cannabis-accommodating cabin might be a decent speculation. Is fragrance-based treatment your strong point? Building up a scope of cannabis-based imbuements may hold the way to your prosperity. It is safe to say that you are increasingly the innovative sort? Concoct one of a kind items to enable clients, to state, ingest or process pot. 

In case you're keen on profiting from pot however don't need coordinate contact with the item you should need to consider offering subordinate administrations, for example, consultancy; security, and application making. This approach has another preferred standpoint; on the grounds that the main part of cannabis related controls (and expenses) target merchants, producers, and providers, giving subordinate administrations is normally more beneficial.
  • Affirm there is a business opportunity for your item or administration 
  • Give you the way to separate your items or administrations, basic as the business turns out to be progressively swarmed and aggressive. 
  • Help you adjust your contributions where essential 

When you begin your business, you should set aside opportunity to manufacture a decent association with your clients. Your prosperity relies upon it, cautions Krista Whitley, CEO of Las Vegas based cannabis aggregate Altitude Products. Lead consistent consumer loyalty studies and have a productive client contact procedure set up. 

Get (and Stay) Familiar with the Laws and Industry Best Practices 

You may have a triumphant thought and a responsive client base, however in the event that you don't play by the standards, you will get fines and correctional facility instead of benefits. Hence, you have to get up to speed with the laws and directions identifying with the business in your locale. 

There are, tragically, twisted, so you will more likely than not require the assistance of an accomplished lawyer to effectively explore them. Laws change by territory and nature of the business. A fastidious adherence to government, commonplace, and neighborhood directions can enable you to maintain a strategic distance from difficult issues. 

Controls will shift starting with one state then onto the next, which mostly clarifies their multifaceted nature. 

All in all, most areas limit the number or size of cultivators or dispensaries they can permit. What's more, they request high application charges and force stringent working controls, which incorporate strict administration and budgetary announcing necessities. 

Aside from keeping away from imprison time and fines, you likewise need to play by the standards to abstain from painting the business in an awful light What you do influences the notoriety of the business all in all, and rashness just helps the individuals who might want to see it gone. 

Since the business is as yet incipient and not completely managed, you have to consistently refresh yourself on changes to cannabis related laws in best practices; in addition to other things, get every single required permit) utilize the correct marking, effectively name your items, and utilize proper advertising and deals channels. 

Raise (Adequate) Capital 

Wanting to approach your bank for a credit to fund your fantasy business? Sadly, on the grounds that cannabis organizations work in a legitimate strange place, it's for all intents and purposes difficult to acquire financing from conventional budgetary foundations. Try not to lose hope as different alternatives do exist. 

Holy messenger financial specialists are one alternative. They have practical experience in high-hazard, exceptional yield interests in developing organizations. Aside from financing, these speculators additionally offer associations, mastery and even calculated help. Dissimilar to customary agents, who center only around productivity measurements, holy messenger financial specialists tend to likewise search for characteristics, for example, energy and responsibility.

Be that as it may, a can-do disposition all alone won't influence holy messenger financial specialists. You likewise should be sure about what sort of give you need, and back your pitch with numbers demonstrating why it is justified regardless of their chance and cash. You should likewise give evidence of individual and association capability. What's more, be prepared to wrangle. 

In the event that this sounds reminiscent of Shark Tank, it is on the grounds that the show comprehensively reflects what occurs in commonplace financial specialist pitches. Attempt to get on the program; on the off chance that you are effective, your business will get important attention regardless of whether you don't get a dime. 

Crowdfunding, another method for raising capital, can be generally effective if your thought reverberates with a wide group of onlookers. Pot centered crowdfunding stages incorporate 420fundme, Fundanna, CannaFundr. To expand your odds of progress, ensure your profile and showcasing are first rate, and that you have an influential strategy for success. Contingent upon your business objectives, you can either pick value crowdfunding or general, Kickstarter-style gift-based crowdfunding. In value crowdfunding, you give benefactors a piece of your organization as a byproduct of money; in general crowdfunding, sponsor get a reward, for example, a free item. With value crowdfunding, along these lines, you net financial specialists, while general crowdfunding can enable you to manufacture a client base. 

You can likewise get standard business advances from elective agents, for example, National Business Capital, Green Leaf Money, GoKapital, and Diamond Business advances. They give everything from business credit extensions for everyday costs to term advances for huge, one-time costs. Contributions and prerequisites differ; for example, National Business Capital surrenders advances of to $5 million, however just loans to organizations with a yearly wage of in any event $180,000 and a FICO assessment of 680 or higher. GoKapital, interestingly, does not have least FICO rating necessities, but rather organizations must have a month to month income of at any rate $10,000 and no less than four months of business ledger proclamations to be qualified for credits. 

Individual advances are another wellspring of assets in the event that you have a strong record of loan repayment. These are accessible from credit associations, banks, and online loan specialists. Home value credits are likewise a fantastic financing alternative if your home has generous esteem. 

Final Thoughts 

Regardless of the difficulties there is apparently no better or all the more energizing time to put resources into the business. Its embryonic nature can show numerous vulnerabilities, however that nascence additionally limits rivalry and potential for huge benefits. For whatever length of time that you have a special thought that meets an unfulfilled need, comprehend your clients, play by the principles and raise enough capital, you ought to have an incredible shot at eye-popping achievement. Good fortunes!

What Can I Deduct as a Business Expense?

By Randall Orser | Business Income Taxes , Personal Income Tax

What Can I Deduct as a Business Expense? 

This is a question that we get asked often.  The answer is if this expense was paid in an effort to earn business income then yes, it is deductible.  If it was not used to earn business income, then the answer is no. 

The answer that the Canada Revenue Agency (CRA) has provided is quite simple: a deductible business expense is any reasonable current expense (cost) you paid or will have to pay to earn business income (revenue). Though reasonable is determined by CRA and not you. 

Personal Expenses which are commonly audited. 

Travel Expenses – only trips for business purposes such as a meeting or conference are deductible, and this only includes airfare and accommodations for the duration of the meeting.

Shareholder/Employee Medical Expenses – unless you have set up a formal health insurance plan in your company, health expenses paid for shareholders and employees are not deductible.

Non-business meals – Unless a meal is to try and earn business income, such as taking a client out for lunch or dinner it is not deductible. Taking yourself out for lunch is not deductible!

Expenses Deductible for Business Purposes

Here is a list of the types of expenses that are deductible for business purposes, they are all linked to the CRA information site for further information.

This is a long list and properly accounting for your business expenses can be difficult, but it is our job at Number Crunchers® to figure this out for you.

Why does Your Marital Status Matter for Taxes?

By Randall Orser | Personal Income Tax

I get this question a lot. People who are married usually just assume that they have to file together as they’re married, and that’s correct. However, those living together, but not married, must also state their marital status to Canada Revenue Agency (CRA). And, you must file as common-law if you are in a relationship with the person you’re sharing accommodation.

So why does marital status matter? Your marital status affects your child and family benefits. The Canada Revenue Agency (CRA) uses your family net income to calculate them, so they may change when your marital status changes.

The CRA will recalculate your benefits and credits based on:

  • your adjusted family net income
  • the number of children you have and their ages
  • the province or territory you live in

What is your marital status?

The definitions of the following terms will help you determine your marital status.

Spouse

A spouse is someone you are legally married to.

Common-law partner

You have a common-law partner if you are living in a conjugal relationship with someone who is not your spouse and at least one of the following applies:

  • you have been living together for at least 12 continuous months
  • this could include any period you were separated for less than 90 days because of a breakdown in the relationship
  • he or she is the parent of your child by birth or adoption
  • he or she has custody and control of your child (or had custody and control right before the child turned 19) andyour child is completely dependent on that person for support

Separated

You are separated when you start living separate and apart from your spouse or common-law partner because of a breakdown in the relationship. The breakdown in the relationship must last for at least 90 days and you do not reconcile in that time. A separation of less than 90 days is not considered a separation for child and family benefits. Once you have been separated for 90 days, the effective date of your separation is the first day you started living separate and apart.

If you continue to live together and share parental and financial responsibilities, the CRA will not consider you to be separated for administering the CCTB and GST/HST credit legislation.

If the separation is involuntary, you are still considered to have a cohabitating spouse or common-law partner. Involuntary separation could happen when one spouse or common-law partner is:

  • away to go to school
  • away for work or health reasons
  • incarcerated 

How does your marital status affect your benefits and credits?

Canada child tax benefit

If you get married or are now considered to be living common-law, and you or your new spouse or common-law partner has children who live with you, the CRA will put all of the children on the female parent’s account.

If you are married or living common-law with a person of the same sex, one of you will get the Canada child tax benefit (CCTB) for all of the children in the household.

To continue getting the CCTB, you mustfile an income tax and benefit return every year, even if you did not have income in the year. If you have a spouse or common-law partner, they also have to file a return each year.

Goods and services tax/harmonized sales tax credit

If you are married or are considered to be living common-law, only one of you can receive the goods and services tax/harmonized sales tax (GST/HST) credit. The CRA will pay the credit to the person whose return it assesses first. The amount will be the same, regardless of who in the couple receives it.

If you become separated, widowed, or divorced, the CRA will determine your eligibility and tell you if you are entitled to receive the GST/HST credit.

Working income tax benefit advance payments

If your marital status changes, you will need to submit a new working income tax benefit advance payments application. If you do not submit a new application, your advance payments will stop until the CRA receives a new application. The application deadline date is August 31 every year.

What you need to do if your marital status changes

If your marital status changes, you need to tell the CRA before the end of the month after the month your status changed. For example, if your marital status changes at any time in August, tell the CRA about the change by the end of September.

If you have become separated, tell us after you have been separated for more than 90 consecutive days.  You can tell the CRA about your new status and the date of the change by:

  • using Change my marital status in My Account calling 1-800-387-1193

If you receive payments based on an incorrect marital status, you may have to pay back any differences in amounts once your status is changed to the current status. The CRA will go back to the month after the month your marital status changed and change your benefits from then. Visit Balance owing - Benefits overpayment for more information.

A Little Story

Dick and Jane met and decided to live together and did so happily for 15 years. Jane had two children from another relationship whom she had full custody, and Dick had one child whom he didn’t have custody. Dick was a much higher income earner, and never qualified for any benefits; however, Jane was a low-income earner with two kids. Of course, they did their taxes separately, and never thought to file as common-law. 

Then one-day Dick gets audited. It wasn’t a particularly nice audit either. The auditor found out that Jane was living in the same house, were in a relationship, and that they had been filing as single. CRA can go back as far as they wish when adjusting returns, if they believe there’s fraud, even if the fraud wasn’t necessarily on purpose. 

Unfortunately, for Dick and Jane, the auditor went back to when they first started living together, less one year, and bounced their returns, and refiled them based on being common-law. Jane being low income had benefited greatly with having two kids and received many benefits. With Dick’s income added onto Jane’s she no longer qualified for those benefits and ended up having to pay back all of the benefits she’d received in those years. In the end, this added up to over $50,000 for the benefits payback and the penalties and interest on those benefits received. Needless to say, Jane didn’t have that kind of money, and they ended up getting a loan to pay it all back.

Your marital status is very important when filing your taxes, and you must be honest, and file with the appropriate status. As you can see it could end up costing you a small fortune later on.

 

Should you Start a Home-based Business After Retirement?

By Randall Orser | Small Business

With more seniors working later into their lives, either for monetary reasons or because they basically appreciate working, there is a requirement for new occupations for these people. With such huge numbers of people searching for few occupations it is becoming increasingly hard for them to find work. This is why starting a home business may very well be the best choice for them. 

There are a wide range of advantages and favorable circumstances related with a home business. It also it opens the way for retirees to keep working, without competing with candidates in the general workforce. 

Boundless Potential 

There is no lack of locally situated organizations where help or volunteers needed but it is important to build a solid website and network to find clients for their business. Retirees can do be pretty much anything from using the special abilities that they had in their working lives, to to taking a shot at new project or even giving help to people who are not able to look after themselves. Regardless of the type  of work, these sorts of positions are ideal for the gen X-ers age and it helps to open the door and to remain as a merger between conventional work and retirement. 

Work When You Want 

Setting your own hours is one of the best parts of a home business. In the event that you like to awaken early and get a good start on the day then you can begin work at 5 or 6 am and work until early evening. Additionally, if the you have an appointment or need to run an errand, or simply needs to sleep during the day, you can modify your work schedule to suit your needs. This keeps you feeling relaxed and stress free while you can still enjoy working.  In addition having your home business is a source of additional income. 

Odds are, most retired people have more enthusiasm and energy for something that they never used in their profession. They may love carpentry or making candles or cooking for people who can't cook for themselves. Retirement is an ideal time to start a home based business and to maybe begin a new vocation and enjoy it more what they did in their work life.