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President/CEO Number Crunchers® Accounting Inc. Learn how to just say stuff it to this bookkeeping thing with our 'Just Say: "Stuff It" To Bookkeeping program.

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.

 

Help Your Children Turn Ideas into Money

By Randall Orser | Small Business

Back in the days of pink bubblegum and hula hoops, a junior high school kid from a rural neighbourhood was contemplating ways in which to invest and earn money.  In due course, he followed his yearning with a very shrewd action.  With his entrepreneurial spirit intact, he bicycled down to the small, rural town’s local general store and bought up the town’s entire supply of pink bubblegum.  In turn, he made continued attempts to resell the pink bubblegum to kids in the neighbourhood hiking the price to allow him to realize a profit.

Well, the other neighbourhood kids understood the concept of price gouging and were not receptive to purchasing pink bubblegum at inflated prices.  Suffice it to say the idea went over like a lead balloon.  Though the kids suffered a week-long withdrawal from chewing pink bubblegum, they effectively boycotted sales by the entrepreneur and in no time at all prices and supply returned to normal.  In fact, the whole affair ended with the entrepreneur apprehensive to depart his parent’s home for weeks after being branded the town traitor who created the bubblegum famine in the first place.

What the young entrepreneur didn’t count on was the emotional response that resulted in the price hike, and his bubblegum venture quickly failed. The entrepreneur’s spirit was in the right place and he was just steps away from a viable idea.  His only failure was the execution of his plan. Imagine how the story might have ended if this young entrepreneur had sought advice from his parents and his parents became involved in his venture.  He may have benefited from that advice and made his purchase directly from another supplier selling his pink bubblegum for a few pennies less than the general store.  If only the story had ended that way, the young entrepreneur very well may have been elected the town’s local hero rather than the lowly and sought after pink bubblegum bandit. 

The morale of the story is should your child exhibit an entrepreneurial spirit such as that of the pink bubblegum bandit, be attentive to and support your child’s dreams by helping your child develop their ideas into a small business.  Working with your child in a teacher/apprentice capacity affords you and your child many opportunities to learn together as your child builds character and self-confidence.  Developing a business is very educational and your child will gain essential life skills in a fun and profitable format.  Your child will practice setting goals, time management, communicating, organizing and will learn lessons in computer software, general accounting, money management, banking, sales, marketing, and more.

So, how do you and your child get started on such a venture? Listen to your child’s ideas and choose an idea that has potential; an idea which can be developed into a small business your child can operate.  After agreeing on an idea, consult with your accountant.  Minor children are required to file tax returns on earnings just like everyone else.  In addition, your accountant may advise your child of financial benefits such as making contributions to their very own, tax-free educational savings fund and other planning strategies.

After consulting with your accountant on tax issues and how to set up your child’s business, apply for a business license if required so your child is legally operating the business.  Next, you and your child can open personal and business bank accounts so your child has a safe place to store all that money they’re going to be earning.  Shop around because there are a lot of checking and savings accounts that offer special perks to kids that you wouldn’t want to miss out on.

Once your child is squared away with creating a tax plan, obtaining a business license, and setting up banking accounts, help your child create a simple business plan.  The exercise of developing a business plan will help you and your child focus on the guts of your business and teach your child to use problem-solving skills and creativity in devising a plan.  Your child’s business plan serves as an outline of overall business objectives, describes the business, explains how the business will operate, and presents sales and marketing tactics to be executed to achieve plan success.

With your business plan in place, you and your child will enter the start-up phase of your small business where together you will create action items in a “to do” list format technically referred to as a start-up plan. Determine what inventory items to purchase to support your child’s small business and what items are critical to getting the small business up and running.  Determine who comprises your target market and develop a message that reaches your market.  Purchase marketing items for your business such as a website or blog and inexpensive marketing tools like business cards, bumper stickers, and flyers.

Finally, put your child’s ideas into action and begin working through your business and start-up plans.  Prioritize tasks and check off items as you complete them.  Help your child overcome obstacles as they arise, discuss ways in which to accomplish tasks, and problem-solve with your child. Finally, your child will be ready to hit the streets (or the Internet) with their product or service and will begin selling!  Good places to start selling and marketing include friends and family, your local community, your local community newsletter, flyers posted at the local swim club, church, and social networking sites on the Internet to name a few. 

We hope you and your child have fun together as you enjoy the thrills of success and overcome the disappointments of failure encountered along the way to developing your small business.  Become involved with your child’s venture helping your child correct small errors that could result in bursting their bubble and their entrepreneurial spirit should they inadvertently become the pink bubblegum bandit of your neighbourhood.

 

Choose a Strong Domain Name for Your Website

By Randall Orser | Small Business

Every business website or blog benefits from having its own, unique domain name. This gives it professional status and helps it to stand out from the crowd. What's more, the domain name itself can play a key role in attracting visitors, with appropriate wording and so it pays to word it carefully. But there's more to stringing together an attractive, promotional name than you might think. It' II need to be catchy, memorable and original, for instance, while also giving an indication of what your website offers. Check your preferred domain name for maximum effectiveness by asking yourself if it will do the following: 

Lead Searchers to your Site:

Choose words that searchers are likely to use when looking for a website like yours.  If it advertises knitwear that you sell, for instance include "Knitwear" "Knit" "Wool" or another word that searchers are likely to use.  Check SEO (search engine optimization) rankings for the most frequently used words appropriate to your business, then see if you can work the top ones into your domain name.

Say or Hint at What you do:

Attract searchers to your site by indicating your specific niche or service, as well as your general topic. To take the knitwear example, perhaps you make the garments yourself or provide organic or ethically sourced ones, or maybe you offer a platform for buying and selling knitwear, in which case, say so in your domain name. The more you can reveal about your website's content in its name, the more traffic you will draw.

Offer a Soundbite or Eyecatcher:

You'll want your site to stand out from the crowd, so pick a name that will attract browsers and stay in the minds of previous visitors. Try to phrase your name so that it rolls off the tongue and sticks in the memory. It might have a catchy rhythm, quirky pun or nice rhyme, for instance, or two words starting with the same letter. Make it easy to read, too, by using short or familiar words, and separating them from each other with dots. Suppose you sell downloadable waterfall photos, for instance, and want to use that full description in your name, you' be wise to divide them up with dots. Ideally, though, you'd avoid this tricky mouthful by using a more straightforward phrase.

Offer Easy Letters for Keying in:

Some people have difficulties with typing, spelling or both, so try to avoid uncommon letters, like “Z” and “Q,” and number digits, in your domain name. Words that are difficult to spell present off-putting challenges to potential returners and could prevent some searchers from finding you at all, so pick simple alternatives when you can. If your website features pharmaceutical products, for instance, you'd be wise to avoid the long, complicated word, "pharmaceutical," using a simple, familiar alternative instead. Before settling on a domain name try keying it in yourself to see how your fingers cope.

Be Unique:

For both practical and legal reasons, your domain name must be different from all others, even if only by one letter, but that side will be taken care of automatically by the registering process. If your intended name is already in use, it will not be accepted, and you'll need to alter it (perhaps several times) to find an arrangement of letters and dots that no one else is using. Your application will then be accepted.

For further information on acquiring a domain name, such as where and how to apply and what costs may be involved, browse some of the many online sites that address these matters. You'll find advice, clarification and useful Inks for everything you need to know for setting up your online business, or for establishing an online promotional platform for an offline business, depending on the nature of your enterprise.

Registering your website's domain name will be like putting the "Open" sign on your shop door and switching on the lights, ready for customers. It's a simple step, once you've fixed the wording. Just make sure you're ready for all the business coming your way.

Should I Teach my Kids About Taxes?

By Randall Orser | Personal Income Tax

I think that one of the inevitabilities of life, taxes, is something that we should learn about early in life. From why we need to levy taxes, how they affect your life, from your job, business, to what you buy, it’s a good thing to know about taxes. Sadly, school doesn’t do this as well as it should, or at all, so it’s up to you parents to teach your kids about taxes. 

Working Teens

Do you have a teen with a part-time job? This is a good time to show them how taxes work and helping them prepare their tax return come the following tax season. With online resources, it would be easy for them, let’s face it their more tech savvy than their parents, to file online. Better yet, get them to find a tax preparer on their own, so they can see what it’s like when they’re an adult and have to deal with their taxes.

The younger we teach them to do something, the better they can handle it as an adult. You’d be surprised how many young adults (early to mid-twenties) come to us, and have absolutely no clue what to do, or even what they need to provide to us.

The good thing about filing a tax return each year the teen has a T4 is that this accumulates his RRSP contribution room, so when they turn 19, they can start to contribute to an RRSP. Or, for later in life the monies they earned as a teen are contributing to that future contribution limit.

Of course, when they turn 19, it’s time to register for the GST/HST tax credit too. If your child has the confidence to figure that on their own, then the better. Get them reading about taxes, and what they need to do for filing their taxes.

Purchases

When your kid, no matter the age, wishes to buy something this is a good time to teach them about consumption taxes (GST/HST and PST). It’s fun to save for something they want, they know how much that toy will cost; however, they go to buy it and now don’t have enough money as they didn’t know about the taxes (from 5% to 15% depending on the Province). They’re now sadly disappointed and have to save more for the taxes.

If you teach that whatever they want to buy they need to think about the consumption taxes, then they know they need to add more to their savings to cover such taxes. Here in British Columbia you need to add 12% onto most purchases, food is mostly an exception except for pets. For example, if your kid wants to buy a toy that’s $39.99 then they need to add $4.80 for GST/HST ($2.00) and PST ($2.80). The kid needs to save $44.79. 

As a parent, you should think about teaching your kids about taxes as early as they would be able to understand. This way the kids won’t be disappointed when buying something, nor, later in life, will they get in trouble with Canada Revenue Agency because they didn’t file their taxes for five years. Ideally, the schools would teach such things too, maybe parents need to start demanding that schools start teaching kids about real life. As Crosby, Stills & Nash sang, “Teach Your Children Well”. 

Resources

Where Your Tax Dollars Go (Department of Finance Canada)

https://www.fin.gc.ca/taxdollar/text/fanfold/pamphlete.pdf

CBC News report, Feb 2018

https://www.cbc.ca/news/business/tax-dollars-1.4545415

Doing Your Taxes (Canada Revenue Agency)

https://www.canada.ca/en/services/taxes/income-tax/personal-income-tax/doing-your-taxes.html

Get ready to do your 2017 income tax and benefit return (Canada Revenue Agency)

https://www.canada.ca/en/revenue-agency/campaigns/taxes-get-ready.html

How to Retire the Right Way

By Randall Orser | Personal Income Tax

An Ipsos poll stated that 55% of respondents indicated they planned to spend their retirement years travelling, while 54% indicated they wanted to spend more time with their family. Are you a small business owner harboring those same retirement dream? If so, you need to start thinking long and hard about how you plan to retire from your company. Retiring from a small business is not quit the same as retiring from that 9 to 5 job. You need to figure out how your retirement plans will impact your business, and how you will make a graceful exit from it. The following planning tips will help you retire the right way from your business.

Succession Planning

The best move that you can make on your retirement plans is to come up with a succession plan way ahead of when you eventually plan to retire. The earlier you start thinking about training your successor, the quicker you can start imparting your knowledge to someone on your team. When hiring employees have management training in mind, focus on helping team members learn to do your job in your absence, and do whatever you can to build a team that is invincible. Are you planning on selling your small business as part of your succession plan? Having a strong team in place will make selling the business that much easier.

Tax Planning

For small business owners who plan on retiring someday, the critical thing is advanced tax planning. You need to know how the tax laws will impact your retirement plans if you don’t want to get hit with unpleasant tax penalties when you retire. Find a good accountant and financial planner that specialize in retirement, so you know the significance of everything from a diversified retirement savings plan to self-directed retirement funds and capital gains taxes. When you adopt a ‘big picture’ mentality in regard to your tax planning, making your retirement dreams a reality becomes an easier goal to achieve.

Retirement Age Planning

Have you determined an age when you plan to retire? As a small business owner, you need to figure that out, however, that doesn’t mean you have to retire at 65, it can be before or after that. Find someone who is a certified retirement specialist to better understand your options. With careful financial planning, you could retire early, maybe 45, 50 or 55. You might even be able to develop a retirement plan that allows you to hand over control of your small business while retaining ownership rights. Your retirement doesn’t have to begin at 65, and you may find it amazing what options you have to explore.

For a sound financial future as a small business owner, it’s critical that you start retirement planning. Once you realize how many events can impact your future and small business (health, technology, etc.), you start to see the importance of developing a long-term retirement plan for your company. 

 

Is a Registered Education Savings Plan (RESP) Worth it?

By Randall Orser | Personal Income Tax

You may already know what a RESP is; however, here’s some information just in case you aren’t sure. A registered education savings plan (RESP) is a contract between an individual (the subscriber) and a person or organization (the promoter). Under the contract, the subscriber names one or more beneficiaries (the future student(s)) and agrees to make contributions for them, and the promoter agrees to pay educational assistance payments (EAPs) to the beneficiaries.

A RESP is a great way for you to save for your children’s education, much like you’re saving for your retirement with an RRSP. Look at what you can afford to put away and do a monthly contribution so it’s easier on the pocketbook. A RESP is also a great way for the grandparents or aunts/uncles to contribute, just remember that you can only contribute up to a lifetime maximum of $50,000 per child.

Rather than all those toys, and other things that kids just grow out of, this is a great present (the kid may not realize it now though) for when the child is grown and off to post-secondary education. You can even show the child how the fund is growing, and maybe have them contribute when they get jobs.

The advantage of a RESP is that the withdrawals are taxable to the beneficiary. The income earned is paid as educational assistance payments (EAPs). Beneficiaries include the EAPs in their income for the year in which they receive them. However, they do not have to include the contributions they receive in their income. The student will get a T4A with the EAPs in Box 042.

An educational assistance payment (EAP) is the amount paid to a beneficiary (a student) from a RESP to help finance the cost of post-secondary education. An EAP consists of the Canada Education Savings Grant, the Canada Learning Bond, amounts paid under a Provincial Education Savings Programs and the earnings on the money saved in the RESP.

Another great thing about RESPs is the government gives you money in the form of grants. These grants can be the Canada Education Savings Grant (CESG), Canada Learning Bond (CLB), or any designated provincial education savings program. If the government is giving out money you may as well take some and help your child out at the same time. 

Canada Education Savings Grant (CESG)

Employment and Social Development Canada (ESDC) provides an incentive for parents, family and friends to save for your child's post-secondary education by paying a grant based on the amount contributed to a RESP for the child. The CESG money will be deposited directly into the child's RESP.

No matter what your family income is, ESDC pays a basicCESG of 20% of annual contributions you make to alleligible RESPs for a qualifying beneficiary to a maximum CESG of $500 in respect of each beneficiary ($1,000 in CESG if there is unused grant room from a previous year), and a lifetime limit of $7,200.

Canada Learning Bond (CLB)

Employment and Social Development Canada (ESDC) also provides an additional incentive of up to $2,000 to help modest-income families start saving early for their child's education after high school (post-secondary education). 

For families entitled to the national child benefit supplement (NCBS) for their child, the CLB will provide an initial $500 to children born on or after January 1, 2004. To help cover the cost of opening a RESP for the child, ESDC will pay an extra $25 with the first $500 bond. Thereafter, the CLB will also pay an additional $100 annually for up to 15 years for each year the family is entitled to the NCBS for the child. 

Certain provinces encourage families to plan and save for their children's post-secondary education by offering incentives to open an RESP. Currently, only Alberta, Quebec, and Saskatchewan offer such incentives. 

Let’s face it, and education is somewhat pricey, and will probably only go higher. We’re better off than some counties as our post-secondary education system is highly subsidized. That said, it doesn’t hurt to start early in a child’s life to start saving for their education and get other family members involved. Make it fun and let the child know that you’re thinking of them by saving for their future.

 

Improve Your Business with Integrated Workflow and Financial Software

By Randall Orser | Small Business

In the business world, time is money, and one of the biggest time sucks in your business is the sharing of information. What are you wasting too much time doing? Examples are downloading content, faxing documents (yes, we still do that especially to government), emailing lost files and simply running across the building to get that important file. Now your staff have less time to actually do what you hired them to do, and even though the tasks don’t seem that important in the overall scheme of things, they do lower productivity and then your bottom line.

Improved Productivity

An integrated workflow and financial (accounting) software system will help to boost the long-term productivity of your business. The reason is that they can directly access system resources, without needing to go to a superior or other source. You have the necessary information right at your fingertips so you are no longer wasting time searching or making pointless phone calls, emails or faxes (one day we’ll have stopped using this archaic transmission feature).

Your employees have everything direct at their fingertips, and with this easy access they’re spending less time from their desks and on needless tasks. With this new workflow system, they can remain focused without the tasks they would normally need to complete. All of this makes it much easier for your business to produce the necessary products and services without spending time on those other tasks that waste time.

Greater Financial Security While Avoiding Downtime

The financial software aspect of this integrated Workflow system is perfect for companies with multiple departments providing financial information. The sales department may need sales figures, while the marketing department must provide advertising costs.

Without the integrated workflow and financial software system available in the business, all data must first be emailed or sent to the financial department, who then compiles the data in order to come up with the accurate financial report. This is incredibly tedious and does leave the window open to possible errors and incorrect numbers, especially if someone forgets to provide their content by the designated time frame.

However, with software, it’s now possible for every department to easily upload their figures, which is fully integrated with the rest of the company and every other department. Your staff no longer have to run around collecting data just to create and finish that financial report. The software automatically collects this data and allows the financial department to quickly produce the financial report.

Reduce Waste

It’s important for any business to reduce waste as it allows it to focus this time elsewhere on other tasks, which in turn improves productivity and the overall number of necessary tasks completed. It may not seem much of a waste of time running around to various departments to gather files and reports, but over the course of a year that can definitely add up. Having an integrated workflow and financial software system in place is exactly why you can reduce this wasted time considerably. Everyone can complete their tasks, upload it to the system and even gain access to the files which they need without ever having to leave their desk.                                                                                                          


Improving productivity is always important, which is why applying such a system has very favourable meaning for the business. By integrating workflow into the financial structure of your business, you can save time, cut costs and boost productivity. All of which comes back and helps boost your bottom line.


You may be thinking, I’m a small business and don’t have departments as it may only be your or maybe a few employees. However, you still have departments as you have employees doing certain jobs and you can break up tasks accordingly and using integrated workflow and financial structure system can help you relieve the work maybe only you’re doing. You can achieve this with QuickBooks Online and Hubdoc (or Receipt Bank), and other software that works with QuickBooks Online. This can help sales people do invoicing as it happens or work orders are entered and the worker can turn it into an invoice.