Merry Christmas and Happy Holidays!
Planning to stop by the office for some bookkeeping cheer?
Here are Homeroom holiday hours:
December 24 – 830AM – 12PM
December 25 – CLOSED
December 26 – CLOSED
December 27 – 830-430 (regular hours)
December 31 – 830AM – 12PM
January 1 – CLOSED
Thank you so much for all your support in 2019 year!
Hope to see you soon!
Homeroom Team
Let me just click on this super useful Homeroom blog link to learn about the future of my payroll charges…
British Columbia (BC) residents will no longer be required to pay Medical Service Plan (MSP) premiums as of January 1, 2020.
The final monthly MSP premium invoice will be distributed to MSP Group Plans in late November 2019, for December 2019 premiums.
MSP premium debts owing prior to January 1, 2020 will still be owed, and collection will continue for any outstanding MSP premium debts.
According to D&H Group LLP, Employers should ensure that their payroll processes are updated to discontinue any withholding or remittance of MSP premiums for employees for periods after 2019.
The MSP program will continue to provide provincially-insured health care benefits for eligible BC residents. Enrollment in MSP remains mandatory for all residents. See the excerpt from the official Government of BC website below:
BC residents must continue to fulfill their MSP obligations under the Medicare Protection Act, including updating their MSP account due to address changes. HIBC and the Ministry of Health offer easy online services to ensure that their MSP account information and address stay current. To update an MSP account, beneficiaries can visit gov.bc.ca/
managingyourMSPaccount.
The new payroll tax called the Employer Health Tax (EHT), which launched on January 1, 2019, will replace MSP premiums.
Homeroom Small Business Solutions is proud to announce that we are an Official 2020 Top Choice Award Nominee!
Thank you to all of those who have taken the time to nominate us! Now, we need your help to WIN! Voting is now open and if you feel that we have earned your vote, we would appreciate you taking the time to vote for us. Winning the Top Choice Award is one of the largest endorsements a business can receive within North America & Europe, so this is a BIG deal!
Show us some love by voting for us. Your vote will automatically enter you into a draw for a chance to win a grand cash prize of $2000 or one of many Toppy T-shirts. You can vote for us here. Otherwise, you can contact Top Choice Awards via email or phone to vote for us.
Voting ends December 20th, 2019.
We would love to win the Top Choice Award… But we need your help to do so. If you believe we are your Top Choice, why not help us spread the word! Thank you for your time and we appreciate your vote!
P.S your written feedback in the survey is anonymous but very important to us, as it allows us to know what you love about us and what we can improve to continue serving you every day and providing the best customer experience possible. Many thanks in advance!
Forget that pen. Unplug that printer. Signing documents just got hella easier and funner. Let’s jump right in!
Now that you know how to securely submit your online tax documentation, how do you sign all the paper we email your way without turning on your printer?
Each year, we get more advanced and efficient with everything we do. This year, we will be using the user-friendly HelloSign app to send tax returns securely.
E-Signature Is The Way
The electronic signature allows you to sign your tax return draft from anywhere! The Canada Revenue Agency (CRA) accepts personalized electronic signatures. Save the paper err day, all day!
How does the e-signature work?
If you experience any issues or get stuck along the way, give us a call at 604-739-9536.
Next week’s blog post will highlight the turnaround of filing your tax return!
It’s all about the taste! Throw in a mix of select natural herbs, fruits and spices and enjoy an original culinary or cocktail creation bursting with flavour that ranges from savoury to sweet AKA bitters! We’re down with THAT!
Bittered Sling, the award-winning retail line of high-quality cocktail bitters and culinary extracts, is the brainchild of mixologist Lauren Mote and world-class chef Jonathan Chovancek.
Ever since their launch in 2012, the company has been buzzing with success, making local and international headlines.
The name Bittered Sling derives from the May 13, 1806 edition of The Balance, and Columbian Repository (Hudson, NY) that defines a cocktail as “A stimulating liquor composed of spirits of any kind, sugar, water and bitters. It is vulgarly called a bittered sling and is supposed to be an excellent electioneering potion inasmuch as it renders the heart stout and bold, at the same time that it fuddles the head.” — Bittered Sling website
Bitters are used as a flavouring agent. Add a dash to your plate, or squeeze a few drops into your spirits or even sparkling water to create a powerful potion of exciting flavours! Yum yum yum.
Be the star of ANY party with fun and tasty recipes, like Coffee Swizzle, with Bittered Sling bitters here.
As part of our New Client Feature series, we caught up with Chovancek, who together with Mote, has over 30 years of professional experience, on healthy eating, motivation and startup advice!
When it comes to healthy and happy eating, Chovancek suggests fermented foods and drinks. Plant and seafood-focused and plenty of exercise. “Find activities you find fun—don’t get stuck in workout ruts!”
“The independence.”
“The people we interact with everyday.”
“Anything with a Bittered Sling cocktail.”
“Fate.”
“My business and life partner!”
“Grow, grow, grow. Unite people around the world through flavours.”
“Find a niche that is under represented in the market. Allow your passions to guide you.”
“Work is life!”
“Anyone who enjoys delicious food and beverages. We are all about taste!”
Is your tricky tax situation keeping you in the dark? | Photo by Alexas_Fotos via Pixabay
By now, you’re probably feeling a bit more keen to dip your toes into the world of online tax filing, and save yourself time and money!
But what about that extra self-employment income you earned mid-year after your messy divorce? Or that time during the fall when you took a 3-week contract at an office after quitting your full-time job at your kid’s school, right before you started working part-time as an actor?
Sure. Not every tax situation is clear-cut and on a snap-and-send basis, like the Homeroom E-Return requires. You might feel the need to explain your situation to us in-person.
Thing is, MOST of the time, clients presume their tax situation is more complicated than WE know it is. We’ve seen it all, and it is seldom THAT extra.
Submitting your tax documents online has never been safer and easier. So take a leap of faith! | Photo by J. Berengar Sölter on Unsplash
Look up at the bright sky dotted with tiny humans dangling off stringed balloons, and you might wonder why anyone would want to take such a beautifully vicious plunge to their death. Statistically, however, paragliding is as safe as driving.
And just like driving or if you are inclined, paragliding, submitting your personal tax documentation online has never been more secure or fast! Send us photos or scanned copies of your paperwork in a snap and know that a professional has got your back!
We will email you instructions on how to securely submit all your paperwork to our unique LedgerDocs email address (see waaay below).
Here’s a blurb from the LedgerDocs website on the security of the growing app:
LedgerDocs’ first priority is to ensure that your information remains safe. We have invested in innovative architectural engineering to provide maximum data durability and availability, while using cutting edge security features to take special care of your data.
So stop wasting time with in-person appointments and get your E-Return started today!
File your tax return from your favourite coffee shop, or your PJs! Too good to be true? We take on our clients’ Frequently Asked Questions (FAQs) to help you lose your E-Return inhibitions. | Photo by Viktor Hanacek via Pic Jumbo
Ever heard of an E-Return? Does the idea of submitting all your tax documents online scare the bejesus out of you?
You are not alone.
After years of boring in-person appointments with clients idly staring at the wall, as Homeroom owner Teya Jensen (formally, Mali) e-filed their returns, we quickly implemented the Homeroom E-Return. File from wherever, whenever. Sleep in if you like, hike Mount Everest, or do it on your lunch break. And know that a professional is taking care of your return!
No stress, no appointment necessary, no parking spot required, and hassle-free tax-filing completed in a SNAP!
Let’s look at the Frequently Asked Questions (FAQs) of the Homeroom E-Return. Because there is such a thing as a fun and relaxing tax season and you should know about it!
“Hold on tightly to the things that inspire you” — Unknown
Liquid Amber Tattoo owners Luvia Petersen and Justina Kervel, through persistence and perseverance, and lots of heart, helped shape tattoo industry into a business that is not bound by gender. | Photos by Jessie Robertson
“OMG, what am I doing with my life?”
Even the hugely successful tattoo artist Luvia Petersen grappled with the occasional existential life moment. She injected that energy and angst into her business, Liquid Amber Tattoo & Art Collective.
“It made me feel like I was contributing to society and to my own life in a powerful way,” expressed Petersen.
It was 2000. While strolling the charming streets of Paris, Petersen and her business partner Justina Kervel came across a female tattoo artist Phillipine of Kaplan Art Studio. Enamored of the female-run studio in the then male-dominant industry, they came to Canada and opened up their own, mostly-female run, tattoo shop in 2001. Their goal? To contribute to the rise of females in the tattoo industry.
And, girl, has the tattoo industry grown!
“When we first started it was rare to see a female tattoo artist. Now, they are commonplace. I love that this very old traditional profession has been able to usher in an equal gender identity and at equal pay,” admitted Petersen.
Today, the spacious, brick-walled shop in the heart of Gastown is home to top local artists, who, through passion and dedication, give life to drawings that pour out of them like ink.
In turn, the shop supports and donates to an array of great causes and organizations, like BC Children’s Hospital and Girls Rock Camp Vancouver.
And the good they are doing is etched in the skin of their clients forever.
As part of our Client of the Month blog series, we caught up with Petersen, who’s “enjoyed the process of seeing [her] business grow over the years,” on everything from her most memorable tattoo project to what makes her wake up in the morning to her ‘Aha!’ moment:
“There are so many favourite moments, but one that sticks out is tattooing four generations of women. A great-grandmother, grandmother, mother and daughter. We were proud to be a part of that beautiful bonding moment in the four lives of these amazing women!”
“About 10 years into the business, I realized I really did not know what I was doing. At that point, I was able to let go and enjoy the ride a little more. I stopped trying to control everything and tried to trust in my ability to handle whatever may come in the moment.”
“Seeing my employees and my customers smile because they are enjoying being at the studio. It was always our goal to create a fun atmosphere to work in and when I see those smiles I know we are fulfilling that dream.”
“To be a catalyst for artists to showcase their work, be it on skin or canvas. We want to continue to expand our art gallery and host art shows.”
“Make sure you LOVE what you do. It will make the long hours and hair-pulling moments a little more tolerable.”
“Haha…what’s that? Joking…You hire the right people whom you can trust to take care of the business while you are living your life.”
“Our tattoo studio is for anyone looking to bring some new art into their lives.”
Get in touch with Liquid Amber Tattoo today here for quality, custom tattoos that you will love for life.
“Siri, how do I pay myself if I’m incorporated?” | Photo by Viktor Hanacek via Pic Jumbo
So you have gone through the process of incorporating and have finally reached the super fun part: PAYING YOURSELF WOOOOOO.
When it comes to paying yourself as a corporation, you have two options: You can either pay yourself a salary or you can pay yourself dividends.
Which option makes the most sense for you is influenced by your level of income, your corporate structure and of course your accountant’s advice.
Here is an overview of what each option has to offer.
This option is usually the more expensive of the two from a company perspective.
To set this up you will have to add yourself to the company payroll and ensure the company pays all the applicable taxes on your behalf and issues you a T4 annually.
CON
The company will have to pay payroll taxes on your behalf
PRO
You accumulate more room in your RRSPs to save on personal taxes
This one requires less work to set up but can get out of hand if you don’t keep track of your spending.
To make this one work you have to:
CON
You need to keep better track of your withdrawals and can pull out more income than intended increasing your tax rate.
PRO
You avoid paying payroll taxes.
As always, when in doubt or unsure of which option makes the most sense for you talk to a professional. A small investment on advice can provide big savings down the line.
Handshake to that! | Photo by Viktor Hanacek via Pic Jumbo
You did it! Took the plunge and incorporated your small business.
Great work! The next question is floating in your head is probably – Now what?
Don’t panic! We are here to throw you a bookkeeping floaty to make sure you do not sink in the sometime cold and unnerving incorporation waters.
FIRSTLY, make sure you do not forget to do the following:
THEN…
HACK:
Next week, we look at how to pay yourself when you are incorporated.
Register for our “Should I Incorporate” webinar on August 24 at 1pm today here to learn everything you need to know before you decide to Inc. up!
It’s incorporation o’clock!
Incorporating can be the best thing that ever happened to you and your small business or a wrecking ball moment that sinks you into poverty.
Here are the pros and cons of incorporating:
You are NOT your business
Separate Entity
Though your business is still liable for any debts it incurs, as a shareholder your personal assets are protected.
Unlimited Lifespan
Tax savings
They say, “Nothing in life worth having comes easy…” and such is often true with business incorporation…
Cost to incorporate
More government reporting
Annual report for the BC Corporate Registry
More tax returns
Once you incorporate you will have to file a corporate tax return AND a personal tax return
Increased accounting costs
Sometimes no matter how hard and long you meditate on a question, it takes a guiding hand of a professional to light the darkened path | Photo by Annie Spratt via Unsplash
Say, “Holla” to Homeroom’s new small business incorporation series!
Deciding to incorporate your small business can save you money and legal hassle down the road. Do it at the wrong time, though, and you’re looking at a barrage of fees coming at you faster than you can say, “Open for business!”
So how do you know whether or not you should incorporate and what do you do once you take the plunge?
Over the next few weeks, we will look at the top questions you should ask before you incorporate your small business:
Register for our “Should I Incorporate” webinar on August 24 at 1pm today here to learn everything you need to know before you decide to Inc. up!
As part of our Client of the Month series, we look at Xtreme-EffeX, top custom ironworks and fabrication biz with swag!
Imagine this: A beautiful four-story staircase with glass landings. You’re at the top floor, awestruck, as you glance down at the transparent tier and see the basement at the bottom of the house.
Xtreme-EffeX, Custom Design and Fabrication, has been making projects like this a reality for residential and commercial properties in Vancouver and throughout North America since 2007. In fact, they designed and built the swanky residential glass staircase mentioned in the first paragraph.
The brainchild of Ryan Ramsdale, Owner/ General Manager, who built Xtreme-EffeX out of his garage, has evolved into a flourishing retail and fabrication hub that connects businesses, homeowners and developers to the most cutting-edge design trends and products.
Photo: Ryan Ramsdale admits he does not have too many photos of himself. It is evident that his focus has always been on his family and business.
With Xtreme-EffeX inventive design-build process, the in-house design team creates unique, functional and durable products that FIT.
Their motto? “Customize rather than compromise. Because custom fits!”
It’s design with impact. With passion, precision and hands-on approach, it’s high-end work that exceeds expectations, going above and beyond with their out-of-the-box approach to realize your vision no matter how seemingly far-fetched or impossible.
Surely, it is no surprise the 10-year-old business has a five-star presence in the industry with access to the best products and materials on the market and the most skilled fabricators.
Whether it’s your outdoor living space that needs sprucing up or you are looking for a special installation project, or security solutions, Xtreme-EffeX is there to save the day, and make it a lot more awesome!
With no signs of slowing down, you’ve probably seen their eye-grabbing work at upscale restaurants, lottery show homes, and designer retail stores.
As part of our “Client of the Month” series, we caught up with Ramsdale on everything from life as a business owner to advice for new startups:
“The experience I gained through the industry and the drive to want to continually create custom products that my team and I can be proud of.”
“Through hard work, the freedom and ability to create a schedule that benefits me, and especially my family.”
“The ability to take raw materials and create functional items, using different processes and practices, to achieve what most people don’t see as possible.”
“My #1 motivator would definitely be my family. Working hard and developing a business that allows me the time to be there for and with my family.”
“Being able to confidently rely on my team to carry out the tasks that I would typically feel to be my responsibility. Releasing the control and being pleased with the results.”
“To have self-sufficient business with a dedicated team of motivated fabricators and designers that consistently exceed the expectations of our customers and clients in every aspect.”
“‘With dedication to your dream, you can spend a few years of your life like most people won’t, so that you can spend the rest of your life like most people can’t.'”
Anonymous quote
“With the technology of today, it makes it very difficult to be able to turn work ‘off’. But it’s planning for tomorrow, today, then actually turning work OFF and enjoying what it is that we work so hard for.”
“Home builders, home owners, architects, developers, or anyone with a design idea or concept that needs to be brought to life through our design/build process.”
Find Xtreme-EffeX online here and check out all the neat things they do on the daily to make living and work spaces way cooler!
Girl working on her MacBook in caffe by Viktor Hanacek
Sometimes it’s easy to get caught up in the day-to-day business operations that you miss the little things that can add up to big and pricey mistakes. Whether it is a late GST filing or a missed payroll remittance payment, we are here to help with the financial side of your small business.
Leave the books to your professional bookkeeper buddies and focus on what you love! 🙂
The success of your business is OUR business. We have the big picture in mind. It is much more than posting income and expenses (though we can never have enough of that sweet click click click sound of the POSTED stamp as it graces your business receipts).
Call us your personal bookkeeping miracle workers! We will turn your messy, torn-up pile of receipts into a beautiful, sparkling file your accountant will be proud of.
Not convinced?
Stay tuned for next week’s post to see how your business will benefit from having a professional bookkeeper on your team!
Sure, we’re smart, cool and fun! But as a small business owner, do you need a professional bookkeeper?
We have the big picture in mind. It’s much more than posting income and expenses. We know what needs to be done to file your year-end accurately while ensuring that your tax bill is as low as possible. (BOOYAH! And no mad taxman high-jumping it to your back!)
Over the next couple of weeks, we will elaborate on two topics:
Need a bookkeeper, like, yesterday and can’t wait for next week’s blog post? Get the process rolling now here. 🙂
Tax installments got you scratching your brain?
Let us help! Tax installments are pre-payments made to the CRA on certain dates so that you can avoid paying a large tax bill on April 30th.
If at any point you are projected to owe or have owed a net tax of $3,000 or more in any given year ($1,800 for residents of Quebec) it likely that you will receive an installment reminder from the CRA that requests you prepay a set amount of your income tax by installments. This can occur if no taxes or not enough taxes are deducted from your income during a given year. While this is common for those with self-employment and rental income, income from some pension plans, investments and second jobs may also be subject to installment tax payments.
Here are three ways to calculate your installment payments:
Here’s an important tip from CRA:
If you are required to pay installments, the CRA needs to receive your installments BEFORE December 31 of the current year.
Here are suggested dates to pay your tax installments:
Whether you pay in a one lump sum or make monthly installments, as long as you pay your full installments before December 31 you will avoid installment interest.
If you received an installment reminder and missed your March 15, payment do not panic. Just make sure you make it up before the end of the year.
Tax installments never looked cuter…
Whether you spell it “instalment” or “installment”, it comes down to this: If you have ever been hit with a large tax bill on April 30th, you’ve probably considered changing your plans the following year and making either regular or occasional installment payments, to avoid the same shock happening the following year.
As part of our new blog series, we will look at paying your net tax owing by installments and answer these two common questions such as:
Get ready for cool and informative weekly posts on one of our most asked questions, especially during tax time. Amazing conversation starter alert.
The Number Cruncher Allysia is laughing a little too hard on the eve of her GST filing target date…Luckily for her, she’s on track and won’t let deadline stress get the best of her!
Who doesn’t love the P-word? Procrastinate. We all do it. Whether we are taking a break from spring cleaning to brush up on annual BC Budget or freaking out over an internet outage on a beautiful sunny day.
But what do you do when you wake up from a sweet dream of popcorn and butterflies and of doing nothing, and realize that tax deadline is standing right in front of you, evil laughing and pointing its long, wrinkly finger, shakily, at you?
Pop a gummy bear vitamin and do this:
You got this!
While many tax firms slave away, droopy-shouldered and sad-faced, to meet their deadlines by working late nights, skipping meals, and glaring at their computer screens until their eyes cry, the Homeroom team is chill. Zero stress, no overtime hours, and everyone’s happy! And we’re hitting goals. So, what’s the secret to work-time bliss?
“Want chocolate?” the Solution Seeker Alan bounced out of the office kitchen area grinning, holding a thin, rectangular package in his hands.
We all motioned, ” YES!”
“It’s green!” noticed the Gatekeeper Anja as she hesitantly broke off a piece and popped it into her mouth.
“It tastes like white chocolate,” added the Task Buster Michelle. She stopped and chewed slowly, looking half scared and half amused, seemingly concentrating on the flavours of the melting chocolate.
“It’s matcha. It means green tea,” confirmed Alan, who’s had green chocolate before and approves of its healthier-than-most-chocolate benefits. “Oh, wait! The package says there’s also white chocolate in there.”
“I knew it!” Michelle jumped to her feet. “I know my chocolate!”
The Lady in Charge Teya took a bite. Her face scrunched up. “Green chocolate? I can taste very little chocolate in here….”
It’s 3pm. The Gatekeeper Anja has one more hour left to go. (She is not keeping track but this blog assignment begs keen observation skills!) She had graduated from slight head banging to outsinging the radio that is blasting fun throwback beats from behind, like N’Sync’s “Bye, Bye, Bye” and K-Ci and JoJo’s “Crazy.”
Anja is working at a leisurely pace to finish up next week’s tasks. Yes, she is ahead and loving it. She stops to gulp down some fresh H2O, laughs about nothing, and continues to work. No, she is not stressed. She is happy.
Her phone shakes the desk gently and rings a chirpy tune to notify the team: It’s time to stretch.
As we get into our regular circular stretch formation, and open chests to the ceiling, Homeroom client Monique Harris, owner of Moksha Yoga East Vancouver, walks in. She pauses at the door with a smile: “Wow! It’s like I walked into my studio”.
The Number Cruncher Allysia stretches her legs to the water machine to fill up. The Lone Wolf Kevin has just returned from his lunch break. He’s on track and feeling good. He stops to chat with Allysia about the sixth ROE he had to do this week.
Teya is powering though Homeroom E-Returns behind her stand-up desk. “I’m on a roll!” She even has time to leave early to pick up her son Jules from school. Thanks to our secure online tax submissions, there hasn’t been many tax appointments. More free time for clients, and speedier filings for us!
Life at the office is good.
So, how are we able to reach a stress-free, no overtime, goal smashing work pace? Because in the midst of a busy, fast-paced day, we don’t forget to stop and taste the chocolate!
Nothing like a hair-over-your-face selfie to show off your excitement and sheer panic of meeting tax deadlines…..
Kudos for getting the tax-filing process started! If you’ve already received the final PDF of your tax return, you should be celebrating, not reading this!!
If you’ve been emailing with us back and forth but haven’t submitted ALL your tax docs, there’s still time!
If you are just getting around to doing your taxes, no problemo. Request the Homeroom E-Return here for a speedy and hassle-free tax-filing. No appointment required, and you’ll get the best Homeroom rate.
Complete our tax intake form here. We will email you instructions on how to securely upload your tax documents as soon as we receive your completed form.
Call the office at 604-739-9536 if you have any questions!
Happy long weekend, y’all, and here’s to meeting those deadlines!
Dropping off the tax paperwork makes for one happy bunny AKA Task Buster Michelle….
As part of our fun and timely tax-filing blog series, we looked at the in-person tax appointment and the Homeroom E-Return as two great ways to get’er done. But not everybody has the luxury of sitting through their tax-filing or lounging on their bed and snapping pictures of their tax documentation and submitting electronically, especially with Netflix in the way.
This week, we cover the Homeroom’s drop-off option for the swamped and the practical. Simply, drop and go. Leave the rest to us.
Homeroom’s drop-off option allows you to pop by our office anytime during our business hours to drop-off your tax documentation. The Homeroom’s lively team will offer you a cup of water to catch your breath while we get some of your personal information eg: Address, SIN #, and make sure nothing has changed since last year if you are an existing client. Then we will send you on your merry way to catch that appointment you’re running late for 🙂
You could have saved yourself loads of time by requesting the Homeroom E-Return. Simply, snap pictures or scan your tax paperwork to us from wherever, whenever. It’s never too late to submit to us electronically. Unless it’s AFTER April 30th……
We hear you. Drop off your tax paperwork at our office to ensure it is personally received by our staff. Got separation anxiety? Stay as we label your folder and neatly put it away into the “to be filed” section in the back. We will offer encouraging words like, “It is in safe hands” and, “We will courier or mail your folder back as soon as we file your tax return.”
You could have kept all your documentation and securely submitted all your tax documentation to us electronically from wherever by requesting the Homeroom E-Return. We would ensure all your files have been received and would have scheduled a phone call if your tax situation proved hairy. Next time, next time!
Our drop-off option allows you to quickly submit all your tax docs to us in person. It is deal for anyone who prefers to personally hand-off their taxes but has no time to watch their taxes get filed.
By requesting the Homeroom E-Return, you could have submitted all your tax docs electronically while having lunch at your fave cafe. Now you have to run and the idea of messing up your hair is giving you the freaks…
You are welcome to drop off your taxes at our office Monday to Friday, 9am to 5pm.
We will be closed on Friday, April 14th for Easter long weekend.
Happy Easter!
The scrap piece of paper floating above the Number Cruncher Allysia’s head comes from a family of reused receipts, serving as the ideal platform for chicken scratch.
When filing a tax return using a new method can sometimes be mysterious and daunting.
Ask yourself these simple questions when trying to determine if the Homeroom E-Return is the best method for you to use when filing your income taxes.
The Homeroom E-Return allows you to file from wherever, whenever. All you need is a steady Wi-Fi connection and a laptop or phone. Simply, request the E-Return here and we will email you the instructions on how to securely submit your tax documentation through our online portal.
NO!
LIAR!! Nobody seriously enjoys planning their day around other people!! We get it though, change is tough and taking your schedule into your own hands can feel weird and selfish. But it’s not!! Be a rebel! Learn to do you for a change!
OH POO!
We know that by submitting online you won’t have a reason to pop into our fabulous office space on West Broadway to get the scoop on the Lady in Charge Teya’s recent wedding or to join in on the fun and casual daily stretches. But it’s going to be ok, we will find new ways to entertain and update you that you can enjoy on your own schedule 😉
Homeroom lists all of their prices upfront and will confirm in advance which option applies to you so that you can make an informed decision prior to submitting all of your documents (see the Homeroom rate here). All of our rates are based on our E-Return structure.
Many well know tax agencies have their basic price listed then sting you for every additional piece of paper you hand over.
I hate to say this twice in one post but seriously, LIAR!! If you really want to feel like the cost of your return is a mystery then, by all means, let us know and we can block out the amount in all our correspondence up until the invoice. We don’t want you to feel like you are missing out on some tax time payment roulette.
Life will be clear and easy and you won’t get to tell your friends about how terrible tax time is and make excuses for not filing your return!
Save paper and leave more trees for the sloths by using our super cool online Homeroom E-Return option. All forms are electronically signable. No printer or scanner required. Do it all from your phone! No need to print countless pages of your tax return. We will securely email you your final copy, with an option to print if you reeeeally wish. Additionally, by not leaving your house you will also be saving gas making the world a cleaner, healthier, forever home for us all.
Ok seriously! What kind of monster doesn’t like sloths?????????????????? We have nothing left to say!
Yes, your friends might call you a hippy for caring about the environment but you are strong, you’ll survive this mocking by knowing that the entire Homeroom team thinks you are an environmental hero.
Request the Homeroom E-Return here, or stay tuned for next week’s blog post that will feature the in-person tax appointment.
Whether you have taxes owing for this year or you are a business owner who needs to settle a debt, handle it like a boss and pay the CRA to avoid late fees and any legal trouble.
Here are some ways you can pay the CRA, whether you are an individual or a business:
The Canada Revenue Agency (CRA) is getting hip by being down with the online payment world!
The CRA prefers to receive electronic payments. It’s fast and easy! You can do it two ways:
Remeber these ones take more time so be sure to give yourself a head start if you want to avoid late payment penalties.
For information about your account balance and payments, including installments, see My Business Account.
When completing your return, you may calculate a balance owing on line 485. Your balance is due no later than April 30, 2018. When a due date falls on a Saturday, a Sunday, or a holiday recognized by the CRA, your payment will be considered on time if the CRA receives it or it is postmarked on the next business day.
Generally, if this amount is $2 or less, you do not have to make a payment.
If you owe tax for this current tax year, and you file your return after the filing due date, the CRA will charge a late-filing penalty.
They start charging compound daily interest on any outstanding balance starting May 1, 2018, until you pay it in full.
If you can’t pay the full amount you owe, take action right away and call the CRA arrange a payment plan.
For a full list of payment options, go here.
Get in touch with us if you have any concerns here.
Once upon a time, this cup much like a bank account was filled to the brim, and a juicy olive accompanied the penniless toothpick that now quietly rests on the desk….
There is nothing quite like receiving the little brown envelope from the Canada Revenue Agency (CRA) reminding you that you have tax debt. It makes you realize this empty cup is a depressingly on-point indication of your current financial situation.
To ensure you don’t end up in the same situation next year we recommend talking to a tax consultant right away so that you can plan accordingly.
Homeroom’s Alan Chau bursts into panic mode at the thought of a missed tax deadline…Lucky for him, the Canada Revenue Agency (CRA) opened the option to file online on February 20, 2017. So, now he’s got some time in his hands…
Planning on forgetting to file your tax return on time?
The result of failing to file your personal income tax return by the April 30th deadline when there is a chance you owe the CRA money can best be revealed with the scary emoji: 
It is mostly scary financially as the penalty can cost a hefty coin. Basically, your wallet will get the worst of it.
Even if you cannot pay your full balance owing on or before the deadline, you can avoid the late-filing penalty by filing your return on time.
Keep open and honest communication, and the CRA will be your BFF: agreeable, reasonable and understanding. But ignore or cheat them in any way and expect a pricey strike-back.
If you carried on a business during the tax year, your return has to be filed on or before June 15. However, if you have a balance owing for the year, you have to pay it on or before the April 30 deadline. We recommend that all sole proprietors have their tax returns ready to go for April 30 just to be safe.
Find out how to pay the CRA here.
Happy tax season!
Whether it’s because your received a tax slip too late or hungoverly forgot to submit the documentation, here’s how you can make changes to an individual income tax return:
IMPORTANT: Send your current year return separately from any request to change a return for another year.
It may take longer if CRA is requesting more information or your request is sent in spring or summer.
Want to receive a tax reminder?
Complete form below, and here’s to a perfect 2017 tax season!
Have you received all your income slips and do you have all your income tax information neatly clipped in a smooth-surfaced Manila folder ready to go for tax season? (Bonus points for dressing up your tax folder in self-affirming stickers that scream “AWESOME!!” or, “YOU ARE A STAR”).
If you are frustratingly shaking your head or wondering what we are talking about then read on:
Tax slips are provided by your employer, payer or administrator and are referred to when filing your tax return.
You should receive most of your slips and receipts by the end of February. However, T3 (Statement of Trust Income Allocations and Designations), and T5013 (Statement of Partnership Income) slips do not have to be sent before the end of March.
Still, by the time March rolls in, you might find yourself seething at the sight of your mail carrier, who’s brought you EVERYTHING—even Bob’s mail, and you don’t even KNOW a Bob—but your precious tax slips.
Take a moment to:
Here are three ways to get a copy of your tax slips for the current year:
If you need a T-slip for a prior year, you can get a copy by:
Ta-Da!! The CRA opens its online filing services February 20. Homeroom starts filing March 1!
You got this!!
Request the Homeroom E-return today here. We’ll take care of the rest!
The world of taxes can be a murky place, even for the well prepared, one-tax-form student. Add a new business into the mix, and things can get a little daunting.
Running a small business is an eternal learning curve of aha moments. Whether you’re filing an income tax return as a startup or exploring entrepreneurship for down the road, here’s one of the most popular questions that come up every year come tax time.
Every year, many new small business owners who are NOT incorporated ask whether they need to file two tax returns: personal and business.
Before we jump into the answer let’s look at what is classified as business income.
Canada Revenue Agency (CRA) classifies business income as money you earn from the following:
(So essentially any money you make that doesn’t come with a T4 at the end of the year)
NOTE: This income may be earned from a business you operate yourself as a sole proprietorship (SP) or with someone else as a partnership.
CRA Tip: You have to report all amounts of income that are required for calculating income for tax purposes. If you do not report all your income, you may be subject to a penalty of 10% of the amount of income that you did not report.
The short answer is – NO! You just need to file ONE return. But… and there is always a BUT…There is more to the process than a simple personal tax return.
As a sole proprietor (SP), you need to report your business income on your personal tax return (AKA T1 General) by completing and attaching a Form T2125: Statement of Business or Professional Activities (see below).
While you only need to file ONE tax return, there are some tax benefits to being self-employed that you don’t get as an employed individual:
the place where the individual principally (more than 50% of the time) performs administration or employment duties,or
used on a regular and continuous basis, for meeting customers or other persons in the ordinary course of performing the office or employment duties.
You can deduct expenses that are required to run your home office. Eg: Utilities and maintenance costs. If you rent your home, you can deduct a portion of your monthly rent. You can deduct the cost of office expenses (eg: Pencils, stationery, paper clips, stamps, etc). You have to claim the maintenance and repairs related to business use of work space in your home as business-use-of-home expenses. Learn more here.
Of course, individual and business tax returns are our specialty.
Check out our Business Tax Checklist to see what we need to complete your return.
Contact us here if you have any questions or concerns.
Happy 2018 tax season!
“Grab a prop”. And so we did. The result were three hilarious photos jam-packed with Christmassy goodness. Homeroom Christmas party brought us to the magical Vancouver Christmas Market where we enjoyed mulled wine, pretzels and carousel rides. The team continued the fun at Chambar with laughs and toasts! Photo courtesy of West Coast Photo Booth
With Christmas on the brain, a lot of our clients are asking about our hours of operation over the holidays.
While we will remain in full hustle mode (working from 8AM to 5PM, Monday to Friday) for most of the days like cool little bookkeeping elves, we will take some time off to guzzle down jugs of eggnog and insert funny family photos into lively Jib Jab videos.
So if you’re yearning to drop off your bookkeeping before the celebrations commence, please keep in mind the following changes in our hours:
We hope your holidays are merry and bright, and you welcome 2017 awesome-style, wherever you are!
Contact us here or call us at 604-739-9536 if you have any questions about your bookkeeping and ridding yourself of the last bit of 2016!
If you’re like us at Homeroom, you’re feverishly pulling names for Secret Santa with your workmates, and thinking about snatching all the tantalizing Black Friday shopping deals.
We aren’t saying that those things are not important.
However, there are a few more things that we recommend you think about before you body-surf your way to the cash counter or Jackie Chan your way through the mad crowds to that magical trinket that’s calling out to you, to ensure that tax time doesn’t hurt your wallet (or your body) as badly as the holidays can.
Unless you’re like the shoppers in the photo above, lugging human-sized plush toys through the packed fluorescent store aisles….. because teddy bears are forever-friends that can make everything better, even tax season!
If you are a sole proprietor and corporation owner it is time to start making sure you have everything in place to minimize your tax payable and to ensure a smooth transition into 2017, as December 31st is rapidly approaching.
You should determine what business purchases you may want to make in the beginning of 2017. Once you have written your list take the time to consider if you can afford to make any of your listed purchases before December 31st.
If you can it will increase the amount you can write-off when completing your 2016 tax return.
Take the time to look through your 2016 payroll liabilities.
Determine if there are any unpaid balances or discrepancies that you can remit/reconcile by Jan 15, 2017 (the date when final liabilities are due for 2016).
Failure to do this could result in your business being charged a penalty to rectify any errors that are found after your T4’s are submitted.
Note: Good bookkeepers will be doing this on your behalf.
It is good practice to spend this time of year figuring out a rough estimate of what your net income was for the year.
This will allow you to determine if you have put aside enough savings over the year to pay your income taxes and if you haven’t it will at least buy you enough time to write a letter to Santa begging for money to be left in your Christmas stocking.
Personal taxes are on April 30th and corporate taxes are due March 31st so if Santa doesn’t pull through you still have a chance to save.
We recommend that you complete this task even if you are a salaried employee of your company as it will allow you to determine if you should hold off on paying yourself a bonus or if you should defer any salary payments.
Deferring some payments until January may help you stay in a lower tax bracket or at a minimum defer additional tax payments for another year.
If you need help getting your year end in order Teya our business consultant and tax expert is the lady to help. You can make an appointment by calling us directly on 604 739 9536 or by requesting an appointment through our contact us page.
When you are juggling a small business or startup…. every penny counts.
Here are our top four tips for saving money on you bookkeeping:
Keeping your receipts well organized can sometimes be difficult when you are busy running your business. As bookkeepers we are never surprised when a new client brings in bags or boxes of mangled receipts. However, if you are looking to make your bookkeeping as cost effective as possible then the easiest way to save money is to make sure your receipts are well organized so that the bookkeeper does not have to sort them for you.
In addition to sorting them, make sure they aren’t scrunched up into little balls. You may laugh but a lot of people do this and it takes a lot of time to un-scrunch them. Additionally scrunching them up can cause the ink to wear off which means that you are paying us to un-scrunch receipts that turn out to be blank pieces of paper.
Also if you want to claim the GST you paid on a meal as well as the tip (in addition to cutting down the amount of time we spend entering your data) make sure you staple together the original itemized restaurant bill to your credit/debit slip.
Sole Proprietors:
A common mistake a lot of first-timers make is arranging their receipts by month instead of by category.
The fastest way for your bookkeeper to enter your bills into Quickbooks is if they are sorted by category. If you want to go one step further and really limit the amount of time a bookkeeper spends on your file, organize your receipts by category AND company eg. Under transport put all your Translink receipts together.
Corporations:
If you are incorporated then you need to organize your receipts by payment method (eg. Visa account, cash, business savings account) rather than by category so that it makes it faster for your bookkeeper to enter your bills and reconcile your accounts.
Create a filing system for your receipts/ documents and utilize that system so that you can ensure all paperwork is easily accessible.
Keeping your receipts all over the place can result in two issues.
These days a lot of businesses send email receipts. Although you have the option to forward all of your email receipts to your bookkeeper we recommend that you download your invoices and save them onto a flash drive that you can submit with your paperwork. This saves your bookkeeper time as they do not have to sort through all of your emails, in turn saving you money.
It also means that if your email crashes you have all of your important documents saved elsewhere.
If you’re using LedgerDocs, snap pictures of your receipts and forward them to your unique email address in real time. We’ll take care of the rest! Contact us here if you are interested in signing up!
Know what you can and cannot claim and know your categories. For example: in most cases YOU CANNOT CLAIM CLOTHES as an expense unless they are branded with the company logo or required safety wear.
Additionally, you cannot claim haircuts, facials or any other kind of personal maintenance even if you are a TV personality or the face of your company.
Placing receipts into your file that you can’t claim just means that your bookkeeper spends extra time sorting through receipts, remember time is money.
Regardless of what state your bookkeeping is in we are happy to help you. That said, we always recommend that you consider these points because it not only helps you save money it keeps your bookkeeper happy and guarantees that you will be added to their secret list of favorite clients.
If you need help getting organized contact us today.
The Scary Tax Lady is watching……and she means business!
Google “tax audit”:
Frightening indeed.
And it’s happening.
Extra tax auditors, tighter oversight, criminal investigations….
This year, The Canada Revenue Agency (CRA) is upping their game when it comes to catching the wicked tax dodgers, after recent reports revealed possible tax cheats and loopholes in the system, which certain offshore investors were also, apparently, tapping into.
Goosebumps-inducing, isn’t it? Not if you report honestly come tax time.
The government is banking on catching the perps, which seem to have been slipping through the cracks. With a budget hike to bankroll tax hack crackdown , the CRA is already criminally investigating 20 cases of tax evasion and conducting 750 tax audits, according to Financial Post.
“The budget aims to recover $2.6 billion over five years through a pledge of $444.4 million to support the hiring of auditors and undertake investigations and verification of filings,” reported Business Vancouver.
The Canada Revenue Agency’s crackdown on tax fraud in the overheated real estate markets of Ontario and British Columbia is bearing fruit, with auditors recovering $240-million in unpaid taxes and $12.5-million in additional penalties over the past 18 months, new figures show.
The money is being recovered as auditors focus on several issues identified in a series of stories in The Globe and Mail, including property flipping, efforts to hide capital gains and avoid paying sales taxes, and false ownership statements. — The Globe and Mail
Need a trusty tax service to take care of your taxes? Get in touch with us here.
Stay on CRA’s good side, when it comes to proper tax filing because no one wants to be the receiver of THAT call……
Renée Erdman, Owner of Bravo Dog, implements fun and effective coaching techniques for dogs and humans to create a healthy and happy living environment for all. Whether you are in puppy-training mode or tackling deeper aggression-issues with your canine, Renée is your go-to-gal! Photo courtesy of Bravo Dog | Words by Anja Konjicanin
After 15 years of meticulous and grueling graphic design work, Renée Erdman, Owner of Bravo Dog and Certified Behaviour Consultant and Trainer, woke up with a realization: I don’t HAVE to do this for the rest of my life.
“I have always wanted to have my own business. Something to create and to call my own. I grew very tired of working for other people to help them reach their goals,” said Erdman. ” I wanted to do something in my life that gives back and makes a difference, even if it’s a small one.”
Bravo Dog joined Homeroom’s growing bookkeeping client roster this summer, and we couldn’t be more ecstatic about this amazing super woman entrepreneur and her business. Instantly, we had a light bulb moment: we will revive our Client of the Month series, starting with Bravo Dog!
We caught up with the awesome dog trainer last week. She dished on everything, from how she maintains a healthy work/life balance to tips for new entrepreneurs.
There’s even a training tip buried somewhere in there……
Bravo Dog is now two years old!
I can control whether my business is successful or not, whether I take on certain projects and, most of all, being proud of what the work can achieve for dogs and their people.
I meet some of the most fantastic people on the planet. They want to help their dog and their family to ensure everyone is happy and healthy. They are open to changing what they were doing that wasn’t working and they make themselves vulnerable a lot of the time by confiding in me about what is going on in their lives that is possibly affecting their dogs’ behaviour.
To reach the dogs and the people out there that have used questionable training methods and done more harm than good, that come to me with no hope. When I can help them change behaviour using scientific, reinforcement-based protocols proven by years of research and their dogs are happier and THEY are happier. That drives me to do what I do.
To continue to build strong relationships with my clients and those that work in pet-related businesses. I do a lot of volunteer work with Whistler Animals Galore (WAG) and the BC SPCA and I really enjoy coaching and working with volunteers and staff. I would like to do more work with veterinarians in the future.
Even with all the preparation in the world and money you need to have passion and drive for what you do. My motivation for Bravo Dog has nothing to do with money. Although I have to make a living, it’s something I would do for free if I could. If you can say that about your vision for your business then I can’t see how you CAN’T be successful.
Ha, ha! That’s my biggest challenge. My work bleeds into every aspect of my life, it’s wholistic. It can be emotionally draining at times and burnout in this field is high. I took a vacation this year so I am going to try and do that every year. I take one day off a week NO MATTER WHAT. That means no appointments, whether I use it to catch up on work-related things is up to me but just ensuring I don’t book clients is healthy for me.
FUN FACT: Bravo Dog is the first company in the Lower Mainland to officially offer Canine Concierge Wedding services. YES!!!
If you are thinking about getting a dog or already have one and you’re facing some challenges, I can likely help you. A big portion of my work surrounds behaviour issues such as fear-aggression, but I also do a lot of work with puppies and the average dog that needs some help with manners.
TRAINING TIP: A new puppy can bring so much joy to a new family. But the start can sometimes be ruff. Here’s Dog Etiquette Made Easy.
Learn about Bravo Dog’s training programs, puppy kindergarten, or one-on-one private sessions online here, or visit the store at 1493 Crown Street, #2, North Vancouver, BC.
Look at your pile of receipts grinning sheepishly at you from across the room. Do you spend hours staring at them and envision turning that pile into a neat, categorized pile of receipts that are arranged into a filing system that your bookkeeper will love?
Has it possibly been months and the pile is still there? It’s time to let go of the dream of doing it yourself and bring them to us, your cool and keen Bookkeeping Super Heroes!
Slay your bookkeeping this fall (before the holiday craze kicks in November), and be ahead of the ball for tax season.
Whether you’re a small business owner or an awesome human living your life, here are three tips on how to catch up and stay organized, from Homeroom’s very own superhero Allysia Lewis, the Number Cruncher:
We file tax returns for self-employed and employed individuals! We might have the power to revive even the sloppiest bookkeeping, file 12 years worth of tax returns, but you will save money by following the steps above, and help yourself stay up to date with your bookkeeping! The true power lies in you!
Contact us today here to learn more about our bookkeeping services, or request an e-return here.
Get all your ducks in a row with boundless inspiration!
Make work time a happy time, grow your business with industry tips, transform a bad day into an AWESOME day! Homeroom cooked up a little pick-me-up action to help make your day, no matter how sucky or amazing it already is!
Sometimes a self-affirming post-it stuck on your computer screen just doesn’t cut it. And other days you could use some help navigating the small business world.
Here are our favourite go-to blogs (in no particular order) for daily boosts of inspiration. They make us feel all summery inside…
From goal-setting to positive thinking to reinvention to failure, Success Magazine is our go-to BFL (Blog For Life). A true to it’s word “road to success”!
Mashable shares all kinds of cool stuff. Small Business tips, Startups, Advertising, Media. And when you’re tired of reading business posts, check out their Entertainment section for hearty LOL moments.
We love to stalk our girl Jennie at QBOadventures.com to get tips on the number one bookkeeping software we use QuickBooks and learn about new apps in the bookkeeping industry.
Business in Vancouver (BIV)
There’s always something to see at BIV! Catchup on daily news briefs and weekly articles. Local company profiles, investments news, and more! Lady in Charge Teya gets hers mailed to her address weekly, and definitely notices when they do not come (it’s a long story, but when she moved addresses they stopped coming for a brief time, and Teya was sad.)
We give Entrepreneur a golden star! Highly recommend this for ALL Entrepreneurs who are interested in growing their business/ launching a business. They even offer daily health tips to get you in the right mindset, so there is nothing holding you back from success, not even YOU!
You must have heard us talking about LedgerDocs SO SO SO many times before. But we love it. We use Ledgerdocs daily for inputting receipts into QuickBooks Online (QBO). Our clients use it. They adore it. But we also don’t forget to check out LedgerDocs blog to keep up with the program updates, and see what else is new!
It’s all kinds of awesome. We usually peep the Entrepreneur section. It never, ever fails to impress.
Forbes opens up with a quote of the day. Nice, right? A shot of business inspiration in your face from the start! How can you not want to read on? We sure put in some good time reading Forbes.
They’ve got titles that hook, they grab you hard, and don’t let go! “6 thing you’re doing that you’ll seriously regret in 10 years.” Like, how can you not want to click on THAT?
INC.com
While similar to some of the blogs we mentioned above, INC.com is its own gem with lots of GREAT reads, and a definite inspiration booster. Three big YES, YES, YES for all things business, technology and more!
Like us on Facebook to keep up with industry topics and team updates!
What are you reading to get inspired in business and life?
Imagine wedging a 10-hour bookkeeping project into two hours. That’s the dream, and it’s happening!
At Homeroom, we are always on the lookout for smarter ways to save our clients time and money (and save paper!)
Enter LedgerDocs.
We’ve been using the program for around a year and have since had to upgrade our account at least five times to accommodate our growing client base. We currently have 11 active companies on LedgerDocs who’ve chosen to utilize the app to simplify their document management and stay on top of their bookkeeping in real time. It’s truly proven to be the ideal time-saving integration for our clients.
This week, we put the magnifying glass on the LedgerDocs app:
We were frustrated because we were spending too much time and didn’t know what to do, or if anyone would listen to us.
Teya was blown away that even before the meeting, LedgerDocs implemented one of our suggestions. She had a great experience at the LedgerDocs office and said the team was awesome!
Here is how LedgerDocs listened to its customer (us):
Exciting upcoming LedgerDocs feature: Ability to easily transfer Master Admin if necessary.
LedgerDocs is committed to creating a better user experience and listening to their customers to continuously improve their product.
Great job, LedgerDocs! We’re super happy to have a partnership with you.
This app is frigging auto-awesome!
We are always searching for ways to make our practice more efficient and save our clients’ time.
Today we are going to share with you a case study we did on the Hubdoc a document collection and management app that extracts key information from your receipts, invoices, and bills.
We had looked at it more than a year ago. At that time, it was not suitable for our business. Recently, we heard rave reviews from other bookkeepers and Intuit community and decided to reach out to them and see if it would be beneficial to use it.
We have a lot of customers who can’t give us bank and credit card statements regularly.
Clients who can’t provide us with regular statements often fall behind with their bookkeeping which limits our ability to provide them with regular reporting.
Hubdoc allows you to automatically fetch all of your statements and utility bills (BC Hydro, Fortis BC, etc.) in real time. Just link your accounts for automatic delivery. It uses Optical Character Recognition (OCR) technology to analyze your documents. It imports all your financial documents and exports them into usable data.
See below for a step-by-step process for linking your bank account to get regular statements automatically:
Hubdoc is a great solution for fetching bank statements. Unfortunately, the OCR technology does not jive with BC’s unnecessarily complex tax system (GST/ PST/ Liquor Tax/ Hotel Tax..) However, in Ontario or Alberta where only GST/ HST is charged this would be a complete package solution.
To find out more about how technology can help you stay up to date with your bookkeeping, keeping your business healthy and bookkeeper happy contact our team today.
Looking to hire additional help for your expanding business? Last week, we outlined key questions to ask yourself before expanding your sales force.
We noted that deciding between hiring a contractor or an employee is not as simple as figuring out your personal preference. The Canadian Revenue Agency (CRA) has a very comprehensive checklist that they use to determine if you should be paying your new hire as an employee or if it is OK to consider them a contractor.
This week, we are going over the checklist presented by the CRA in more detail so that you can make sure you are paying people under the correct category to avoid nasty fines.
Tip: If you own a store or run an office and you don’t want to hire a contractor through a temporary employment agency then you need to hire an employee and pay the applicable payroll taxes.
Do you want to have control over the worker? Will you determine when, how and where the work will be completed? Do you expect them to complete the work personally?
According the CRA ‘It is the right of the payer to exercise control that is relevant, NOT whether the payer actually exercises this right’ so basically, if you have the option in any way, shape or form to control the employee’s time and how they complete the work then they are not considered a contractor.
Who provides the tools and the equipment to complete the job?
If you provide your new hire with the tools and equipment they need to complete the job and are responsible for all repairs to that equipment then you need to hire an employee.
Can the person who is working for you independently hire an assistant or subcontract out the work you have asked them to do?
If the answer is no, then as you may be assuming by now, you have yourself an employee.
Will the worker be financially liable if they do not fulfill the contract? Does the worker actively market themselves? Does the worker perform a substantial amount of the work from their own workspace? Are they responsible for paying their own employees?
If you answered YES to these questions then you may be able to categorize your worker as a sub-contractor, if you answered NO then you guess it, you need to pay them as an employee.
Does the worker have any capital invested in their business and an established business presence?
If they do then you are pretty safe hiring them as a contractor so long as the also meet majority of the above criteria.
Can the worker realize a profit or incur a loss? Is the worker paid a flat fee and incurs any expenses as a loss?
If the answer is NO then you need to hire the worker as an employee.
In the end if you are uncertain about your relationship with your new hire or you can’t distinctively answer majority of these questions with a YES or NO response (because the status of your relationship is unclear) then it is best to contact the CRA and get a ruling before you proceed.
This will save you a lot of grey stress hairs, and costs in the long term.
Tear. It’s been a year. Your small business is growing before your eyes. You stare at your Profit and Loss statement for the hundredth time like a kid who’s been fervently measuring their height against the wall fixedly checks in on their progress, and your eyes fill with water. You really made it.
Your email inbox is flooded with fan mail. It’s wonderful and scary. You want to respond to all of them, even the creepy ones, you want to be Superman/Wonder Woman/the Hulk combined, deliver on your promise of top-notch service but you need help.
You can finally afford it, but who do you hire: an employee or a contractor?
We recommend that before you hire anyone as an employee you start them out as a contractor for a trial period. This way you can test them out and make sure they work well with you, are reliable and will not steal business from you before committing to a long-term agreement.
Once the initial trial period is over, ask yourself the following questions to give some clarity when trying to determine the best way to proceed with your expansion:
Will you need to control the time of those who help you and the sequence in which they complete tasks?
Are you supplying all of the equipment?
Do you need a very specific task completed?
Do you have a higher workload because you have taken on a short term, labour intensive contract?
Will the payment of the person you hire depend on you receiving payment for the overall contract?
Do you plan on providing training?
As attractive as it may appear to hire a contractor over an employee you must make sure that your contractor is considered a contractor under the rules set out by the Canada Revenue Agency (CRA) or you risk experiencing heavy fines.
Stayed tuned for next week’s post where we will discuss the CRA employee or contractor checklist in more detail.
Do you want to save big bucks on your bank fees? You’d be saving more than just money. Tons of precious time goes into deciphering cryptic e-transfers that turn up on your monthly statement. Well, no more!
We were recently introduced to a new app Plooto, an online payment solution that takes the guesswork out of determining unknown e-transfers and saves valuable time and money. We were dazzled by its impressive features and functionality.
So we are shouting it from the rooftops: This is an invaluable, must-have program for all small business clients who process cheques, email money transfers and wire transfers regularly.
We strongly recommend this quick and seamless online payment option for ALL our clients.
Plooto is every business’ and bookkeeper’s dream come true:
Click here to see how much you’ll save.
Below is an example of how much you will save if you process 50 wire transfers in a month:
Contact us here to learn about getting started today!
Got a receipt? Capture it. Send it. Leave the rest to us, your #1 bookkeeper!
It’s that time of the year again! Remember the olden days when you had the cumbersome task of lugging bags of receipts the Homeroom office for your bookkeeping? Well, the FUTURE IS HERE!!!
The days of collecting paper are over.
We now have an option to submit your receipts electronically to us using the LedgerDocs app, while still getting regular accurate and timely reports.
LedgerDocs integrates with QuickBooks Online (QBO) allowing us to publish all of your expenses and income to your QBO file instantly.
You can even throw away your receipts once they are in LedgerDocs. Canada Revenue Agency (CRA) officially accepts PDFs as supporting documentation.
We will also provide you with a back up of ALL your receipts if you decide to move on down the road.
Contact us here if you would like us to set this up for you.
Happy snapping!
Balling! When your wallet fat from all that cheddar…..
You got 99 problems and your incorporated small business ain’t one? Great. Now it is time to pay yourself. Because you can. Unlike sole proprietors, owners of a corporation no longer have to claim all of the income from the business as personal income.
You can pay yourself in a variety of ways.
You can add yourself to the company payroll and receive a T4.
This is a more expensive option as the company will have to pay all required payroll taxes on your behalf. Owners are exempt from EI but must pay CPP like other employees.
However, choosing this option will allow you to accumulate more room in your RRSP’s which you can utilize to save on personal taxes once you are making the big bucks.
Additionally if you are the lower income earner and need to deduct child care expenses from your taxable income you will need to be pay yourself with a salary.
You can declare the money you have taken from the company as a dividend.
To do this you will need to get your bookkeeper or accountant to figure out how much money you took from the business throughout the financial year and issue you with a T5 from the corporation.
Your personal tax rate will be lower than if you take a salary.
As tempting as it may be to pay yourself as a contractor WE DO NOT RECOMMEND THIS OPTION.
Anytime the CRA feels they are missing out on receiving taxes they feel they are entitled to ( which in this case would be payroll taxes) they will, put quite simply, come after you!
For more information about the penalties for incorrect employee classification check out our blog post Employee VS Contractor – CRA Penalties for incorrect worker classification
In the end we recommend that you talk to your bookkeeper or accountant before you decide how you are going to pay yourself so that you can choose an option that is the most tax effective based on your income requirements.
If you are considering becoming incorporated and would like to discuss your options face-to-face with Teya our business consultant and tax expert you can make an appointment by calling us directly on 604-739-9536 or by requesting an appointment through our contact us page.
Big yellow sign, you feel me, bro….
You did it. You put months of heavy contemplation into concrete action and incorporated your small business. *Confetti drop*
Now what?
We hope that this post will help guide you to successfully move forward with your new corporation.
You need to pick a date when you will start operating under the corporation. Usually the 1st of your chosen month is recommended. Once you have picked a starting date you need to allow around 2-4 weeks to get the following accomplished;
You need a completely new set of books/accounting records.
Your old books cannot be rolled over to your new company, no if’s but’s or maybe’s. The time of the year when you were a sole proprietor will be included in your personal tax return, while any business expenses that were incurred after you became incorporated will be included in your corporate tax return.
Figure out how you are going to organize all the new paperwork
Now that you are incorporated the amount of paperwork that you will need to deal with is going to increase tenfold so you need to have a good filing system in place to manage everything.
Since a corporation is a separate entity, you now need to apply for all new tax registration numbers including GST, PST & payroll numbers.
You will need to apply for a new WorkSafe BC account. Make sure to include your current WCB number so that you get your rate information transferred over.
You will need to open new bank accounts and apply for a new company credit card.
TIP: While doing this we recommend that you utilize this time to develop a relationship with your banker as it will come in handy later.
Remember to put your new GST and PST numbers on your invoice template
Track your accounts receivable and accounts payable separately before and after your designated start date for using your corporation.
Inform your insurance company to update the policy with your corporate business name.
You may need to put some of your personal cash into the corporate bank account. Make sure that you track this.
If you are considering becoming incorporated and would like to discuss your options face-to-face with Teya our business consultant and tax expert you can make an appointment by calling us directly on 604-739-9536 or by requesting an appointment through our contact us page.
To incorporate or not to incorporate?
The answer is not so clear-cut. And the looming questions can buzz around your head like fruit flies at a gravesite of a discarded lollipop. It’s enough to turn even the jolliest person into Grumpy Cat.
There are several factors to consider, so before you turn into a furry creature cursed to look like the angry emoticon (>_<) for all eternity , let us provide you with the tools you need to weigh up the pro’s and con’s of incorporating. Let us answer that lurking question experienced by most successful business owners ‘should I incorporate?’ and help easify your life!
When you are a trading as a sole-proprietor your personal assets can be seized to pay your business debts which is a scary thought that can place unwanted stress on you and your family.
If you incorporate your business it becomes it’s own separate entity in terms of liability and financial responsibility.
This means two very important things. Firstly, it means that although your business is still liable for any debts it incurs, as a shareholder you are not personally liable unless you have given a personal guarantee.
Secondly, it means that the business essentially has an unlimited lifespan. Unlike a sole proprietorship which begins and ends with the owner, corporations can continue to exist regardless of ownership changes.
Tax savingsAdditionally businesses that trade as a corporation are taxed at a lower rate of only 13.5% which is a great incentive for sole proprietors that are earning between $60,000-$100,000 on their personal tax returns.
Although incorporating your business may seem very appealing thanks to the promise of lower tax rates and limited liability there are some downsides that need to be considered, which are::
More government reportingDon’t think for a minute that you will get lower tax rates without having to pay the price with government paperwork.
Increased accounting costs and responsibilitiesIf you were concerned about the cost of managing your books and taxes as a sole proprietor chances are high that you will find the increase in cost quite shocking once you incorporate.
More tax returns.
Once you incorporate you will have to file a corporate tax return AS WELL AS a personal tax return
If you have weighed up the positives and the negatives and decided that incorporating your business is the way forward then you will need to budget in the following costs.
Setting up the corporation
This will cost roughly $1000 through a lawyer, which is recommended if there are multiple shareholders or assets to transfer. Alternatively you can incorporate on your own through the BC Corporate Registry for $350 using their online facility.
Maintaining the books
Annual Accounting costs ranging from $2,000 for a simple corporation that experiences minimal activity to $5,000 for an average small incorporated business.
Although this may seem high you really shouldn’t underestimate the value of a good accounting team. This is one area of your business you need to make sure is solid.
We hope that this overview has given you a stronger understanding of why businesses incorporate. In the end we recommend seeking professional advice before taking the plunge and incorporating your business. It is in your best interest to make sure that you incorporate at the best time and set everything up correctly so that you avoid paying penalties or experiencing issues in the future.
In our next post we will be discussing what happens after you incorporate your business and the steps you need to follow.
If you are considering becoming incorporated and would like to discuss your options face-to-face with Teya our business consultant and tax expert you can make an appointment by calling us directly on 604 739 9536 or by requesting an appointment through our contact us page.
Recently, a lot of people contacted us about whether or not they should incorporate their small business. So, we are turning to our trusty Homeroom blog to provide you with handy tips and advice with weekly posts on just that: the ABCs of incorporating your business.
While there are many advantages to adding “Inc.” to your business name, there are also a myriad of risks when you take the Inc. plunge at the wrong time, including costly mistakes that can hurt you financially if you don’t fulfill all of your responsibilities with the Canada Revenue Agency (CRA).
In order to help you gain a better understanding of this topic we will discuss the following topics over the next few weeks:
This post will discuss the costs involved, the criteria you should consider before taking the plunge and the common mistakes people make when deciding to incorporate.
We will help you understand the process, what decisions you need to make and what reporting needs to take place.
This topic is pretty self explanatory. Paying yourself is really important and once you incorporate you want to make sure you do it correctly.
We hope that our series on becoming incorporated will allow you to gain a better understanding of what being incorporated means for you as an individual business owner and for your business.
If you are considering becoming incorporated and would like to discuss your options face-to-face with Teya our business consultant and tax expert you can make an appointment in July by calling us directly on 604-739-9536 today or by requesting an appointment through our contact us page.
If your box of receipts is shapeshifting into a pot of paper flowers, exuding a musty book smell, this article is for you. Use the most cost-effective and fast categorizing approach so that you can account for every receipt when it matters the most, and save some dough for real flowers.
“It’s actually faster to sort that way as opposed to trying to find the date on each receipt,” said Homeroom’s Lady in Charge Teya Mali in the recent Globe and Mail article on the importance of record-keeping in business. Teya was not talking about the throw-and-forget approach illustrated in the above left photo.
Find the best way to categorize receipts, why you should keep a mileage logbook, and more handy tips, to run a healthy business in the full article, “In record-keeping, consistency is king,” by Paul Attfield.
While the petition to raise the minimum wage in British Columbia to $15 still seems to be an active fight for change, BC’s minimum wage is climbing out of the chart dumps. Dubbed, ‘Lowest in Canada,’ the 80 per cent increase will place our beautiful BC in the whopping seventh place, with an additional small-business tax rate reduction of 40 per cent in 2017-2018.
Nice, eh!
The increase will come in two stages:
Liquor servers (who get $9.20 per hour ) will get the same wage increases on the same dates.
Though the wage hike is not being celebrated by everyone, it’s a definite step up!
Raise the roof to that!
Wah, scream, scratch. Tax season can make the best of us rip out our hair in a deadline frenzy, then hurl our bodies into a dark corner, where no one (*cough* CRA *cough*) can ever find us, ever, ever again.
Do this instead.
File and pay your taxes on time otherwise you risk serious consequences, especially if you owe the CRA money. And while the task can seem daunting at best, the CRA can be pretty reasonable, but, just like a hungry baby, they do NOT like to be ignored.
The personal income tax deadline is April 30 IF you have taxes owing. If you don’t have taxes owing, you are not required to file a return. However, we recommend that you do so anyway to get your refund and stay eligible for government benefits such as GST cheques, child tax benefits, premium assistance for MSP and Fair Pharmacare.
The income tax deadline for self-employed individuals is very deceiving. If you don’t owe taxes you have until June 15th to file HOWEVER if you owe taxes you need to pay them prior to April 30. without doing your tax return you have no idea what is owing, so we recommend that you file your taxes for the April 30 to avoid interest.
Annual GST payment and filing for incorporated companies is due March 31st, 2017
Annual GST payment and filing for sole proprietors is due April 30th, 2017 despite the fact that your remittance form will say June 15 as the due date. Please see above regarding deceiving deadlines for self-employed individuals.
T4’s must be filed with the CRA and given out to your employees before Feb 28, 2017, if you want to avoid late penalties, which are $25/day.
So you have filed your taxes and discovered that you owe the CRA a lot more money than you expected. You feel your heart sink, you cry for a while and you curse the government for ruining your life.
Just as you finally begin to accept your fate and begrudgingly drain your bank account to pay off your mammoth bill, you receive an installment notification from the CRA. This notification informs you that due to the fact that you owed the government more than $3000 on your previous tax return you are now required to make quarterly tax installment payments (pay your taxes in advance) for the current year. If this isn’t bad enough the fine print will notify you that the first payment is due right away and that failure to pay the amounts requested by their due dates will result in interest being charged.
Although not every person with a bill over $3000 will receive this notification, you should plan to receive it so that you are mentally AND financially prepared.
If you DO NOT get an installment reminder, you DO NOT need to pay installments, unless you would like to voluntarily.
Installment payments are typically due in March, June, September, and December.
You will get a statement of installments paid from the CRA that you will need when you file your taxes.
Installment interest will be charged if you receive an installment reminder and you fail to pay the amount owing in full by the due date.
If you anticipate your income for the year is going to be much lower than your previous years’ income eg. you are going on maternity leave and won’t be working for 5 months of the year.
Contact the CRA and discuss this with them. If your tax owing at the end of the year is below $3000 then you won’t be penalized for not paying the installments.
If you need help filing your income tax please don’t hesitate to contact Homeroom SBS today.
Happy tax season!
Riding on the back of the shear excitement of another successful tax season, we knocked down a chunk of the back wall and increased our office space by an entire room. The Lady in Charge Teya finally gets the much needed privacy of her own office, and we get more legroom.
Yes, more room for awesome!
We are looking for a fabulous part-time bookkeeper to join our growing team of six, and take over the lonely, soft, leathery chair with your name on it.
Our hiring process is simple. We don’t bother with resumes, and wasting paper.
Do this instead:
Reply here by answering the following questions:
Homeroom Small Business Solutions is a growing, fast-paced tax preparation and bookkeeping company based in Vancouver. We pride ourselves on providing quality customer service, accurate and honest bookkeeping and great employee benefits.
We love what we do and want to find additional team members who are passionate about providing great customer service, set and achieve high standards of work, pay close attention to detail and who are loyal, motivated and passionate about life and business.
In return we will offer you a stable, flexible, supportive workplace with opportunities for growth.
We currently have a part-time position available, with a potential for full-time, for a qualified bookkeeper starting mid May.
Salary + Benefits will depend on experience.
We also pay commission for any clients you bring to the company.
If you believe you are the perfect fit please send us an email answering the questions at the top of the ad. No phone calls or drop ins.
Part-time
A lot of new mamas (and dadas) come to Homeroom unsure about whatchildcare expenses they can and can’t claim come tax time.
Below, we look at eligible childcare costs, the amount you can deduct and which parent claims the costs.
So, what constitutes a childcare expense?
Childcare expenses are amounts you or another person paid to have someone look after an eligible child so that you or the other person could:
The child must have lived with you or the other person at the time the transaction incurred for the expense to qualify. Usually, you can only deduct payments for services provided in Canada by a Canadian resident. See other situations for exceptions.
What are eligible childcare expenses?
When the child lives with both parents, the parent with the lower net income (or zero net income) must claim the expense deduction. The supporting parent with the higher income may claim a deduction only during the period in which the lower income spouse or common-law partner is mentally or physically infirm, confined to a bed or a wheelchair, attending full- time at a secondary school or a designated educational institution or incarcerated in a correctional facility.
The amount that can be claimed for childcare is subject to special rules when the lower-income spouse or common-law partner is in part-time attendance at a designated educational institution. Special rules also apply for single parents and those who have separated during the year or are divorced as our team for more details.
You can deduct up to $8,000 annually for each child who is aged six or under at the end of the year, and up to $5,000 for each child aged seven to 15 at any time in the year.
This limit goes up to $11,000 annually for each child who is eligible for the disability tax credit. Also, the total deduction can’t exceed two-thirds of the salary or business income of the parent who is required to claim the deduction. However, it’s limited by the actual amounts paid in the year for childcare.
Still have questions? Comment below for a quick response, or call us at 604-739-9536.
Launching a small business can feel like swinging blindly at a big, colourful, juicy piñata: a hit or a miss, but if it’s a strike, you get all the yummies and toys inside, along with some lame confetti and papier-mâché filler.
The lackluster, more boring, of the bunch become the key steps and financial decisions to starting a new business. But, without careful planning, you might as well be that person with their eyes shut, hopelessly flailing their stick into open air.
One of the things you need to consider is whether or not you need to charge Goods & Services Tax (GST).
We hope our handy tips and our clarification of some common myths helps you move forward in your small business planning.
GST is an input tax: Meaning that the amount that you PAY to others reduces the amount that you OWE.
If you are starting your small business and incurring high start-up expenses. You can get a refund on the GST that you pay on those expenses.
Some potential clients might not want to do business with you if you don’t have a GST number.
Keep your paperwork simple for as long as possible. If you register you will need to hire a bookkeeper to make sure your returns are correct, filed properly and on time.
When you bill your clients your total will appear cheaper than a competitor who charges GST.
By law you have 3 months AFTER you have made sales of $30,000 to register and start charging GST.
You must include your GST number on all your invoices.
You must keep all records of GST charged and paid for 7 years
Myth: Every small business must register for GST.
Fact: Every small business that has made GROSS SALES of $30,000 in a calendar year must register.
Myth: I am registered for GST but my sales are less than $30,000 so I do not need to charge my customers the tax.
Fact: If you are registered, then you are obligated by law to charge all of your customers GST.
Myth: GST and HST are two different taxes.
Fact: In fact they are the same tax being paid to the same agency (Canada Revenue Agency). The only difference is that in BC we now charge GST of 5%; before we charged HST of 12%.
Myth: My Business number is different from my GST number.
Fact: Your GST number is your Business number (9 digits) with the ending RT0001.
Unleash your inner beach diva mid tax season, and rejoice!
Whether you’re ripping the waves in Tofino, or lounging at home with a bird’s nest do, file you e-return whenever, wherever.
Our quick and easy electronic tax filing option is a great alternative for anyone who prefers hassle-free, no appointment necessary service.
April 30th filing deadline is approaching as quick as the Easter bunny. Save time and paper, and avoid CRA penalties.
And don’t let taxes stop you from quality time on the beach.
Fill out the form below, and request an e-return today!
If you know someone who needs help with their taxes, please forward this post to them. We always appreciate your referrals. 🙂
I see a beautiful, white 10-bedroom villa, with a long, spacious veranda that leads to a vineyard, overlooking a flowery hillside. The birds are playing in the field, chirping my favourite tune, with crops that are gently swaying in the warm summer breeze. Life is awesome.
They say, “One person’s trash is another person’s treasure.” When it comes to flipping houses, it comes down to this:
What the flip?
It’s when you see that junky house or an apartment and envision something different in that space, be it new, shiny tile floors and a fresh coat of paint, or a complete and utter gutting of the space.
So you buy it, spice it up, and sell it for profit. Flipping easy, right?
Suddenly, that run-down house becomes a mansion and that dude refreshing himself with a cold beer in front of it turns into a swimming pool. At least in your imagination they do, for now…..
Here’s the bare bones of house/ apartment-flipping:
Tip: Like anyone engaged in the intricate art of renoing, you will need a cool bookkeeper to manage your expenses, file your GST return and make sure your taxes are filed properly.
Even The Number Cruncher, Allysia Lewis gets occasionally sidetracked by the internet……
Virtually everyone is prone to procrastination. A new Donald Trump meme can induce low-brow fun and hysteria even for the most focused cat person ….and put that important tax preparation on the back burner.
The Lady in Charge Teya was interviewed by the CBC about the topic of procrastination. This was fitting for two reasons:
A lot of people procrastinate about organizing their bookkeeping and taxes. As a the owner of a bookkeeping company Teya’s job is to help business owners become more organized and meet their CRA submission deadlines.
As perpetual pro-casters, we have found that Teya has an impeccable ability to avoid distractions (such as social media) and get things done. (If we could nominate her for the “least likely to procrastinate” award, we would.)
You can get there, too–we all can! Stick to the following five tips to really increase your productivity.
Starting a new business can be quite costly so it is common for business owners to take on the initial roll of “everything to everyone” in order to keep costs low.
Although this isn’t a bad way to start, as time goes on and the business grows this workload can begin to become unbearable. This is where the procrastination starts.
According to an article by Phyllis Lokki in the New York Times the larger your workload the more likely you are to become overwhelmed and start procrastinating.
This is why outsourcing certain tasks is really important. It allows you to reduce your workload, free up some of your time and focus on your strengths.
For example: Teya has outsourced writing this blog to me because she is so busy making sure your taxes are filed on time 🙂
Write everything down and prioritize your important tasks. It is easy to use small tasks as a method of procrastination because they give a false sense of productivity.
Think about the revenue each task will bring you and then prioritize accordingly.
For example: Vacuuming your bedroom floor, although necessary, will bring $0 to your business so it should be last of your list. Completing work for your client will bring in revenue so it should be a priority (you can then use this income to outsource your vacuuming)
This is easier said than done, especially when social media is so prominent in most people lives.
Time your usage. Create a social media plan that allows you to fit your daily social media into 20 minutes per day and stick to it OR outsource your social media management to an employee or to a firm.
It is very easy to get caught in a social media vortex. All it takes is for you click on a one link and before you know it 2 hours have passed.
Breaks allow you to refresh your mind. There are several studies that reveal taking a break to eat your lunch or to go for a walk actually increases your productivity.
So stop eating at your desk and enjoy some fresh air.
Emails are often a procrastinators drug of choice. Don’t get me wrong they are important. However, it is easy to fall into the trap of checking them 300 times a day.
You need to limit the time you spend with your emails so that you can focus on other important tasks.
Most people are happy/ pleasantly surprised by a same day turnaround. So even if you only respond to emails once in the morning and once in the afternoon that is usually all you need to ensure positive feedback from your customers.
A great tip suggested by Timothy Ferriss author of The 4 Hour Work Week is to set up an email response that lets your clients know exactly when and on what day you check and respond to your emails so you can manage their expectations.
That’s Michelle Chand, our cool new intern, and a messy bookkeeping project on her lap we call The Big Blue. But all you see is your face, stuck amid a pile of receipts you are not even sure you can claim as a business expense and a mean clock ticking down to tax time? We can help!
So, you just got a styling hairdo at your favourite salon and a fancy Aritzia number to go with it. But can you claim your new look come tax season?
Every year around this time, clients come in, confused about what they can and can’t claim.
So, we decided to bust common tax myths:
Your Dog is not a security expense – You laugh but this is a legit thing people try to claim! We repeat if you have a home office you cannot claim any expenses related to your dog as a security expense. That means vet bills, dog food and hours spent loving your dog are not under any circumstances tax deductible.
Home office deductions are based on the percentage of your home that you use to conduct business NOT the size of your home. You need to calculate: square footage of business area and divide that by the square footage of your home. Storage space for business supplies and/or tools also can be included in your calculations as an area used for business.
GENERAL CLOTHING CANNOT BE WRITTEN OFF UNDER ANY CIRCUMSTANCES. The only benefit you are going to get from purchasing some new work threads is the satisfaction of looking really good. The only exception to the rule is safety clothing such as hard hats or steel toe boots and company branded clothing that is considered a uniform.
Dry Cleaning is only deductible if you are having a company uniform cleaned. That beautiful Armani Jacket you own unfortunately needs to be cleaned at your own expense.
A legitimate meal expense is one where you are going out with a colleague or potential client to discuss business. Going for a solo lunch while working doesn’t count for a meal. You should also record the name and number of the client you are meeting with on the meal receipt.
NOTE: In an audit of one of our clients, the auditor asked to see each meal receipts with the name and phone number of the person who was present at the meal AND a description of the type of business that was discussed.
Just because your vehicle is branded doesn’t mean that you write off 100 percent of vehicle expenses. Auto expenses are calculated based on the percentage of the year’s total km’s that are driven for business purposes. That said the expense of having your car branded is 100 percent deductible as an advertising expense.
If you purchase liquor or any type of gift certificate from a restaurant, for example, a Starbucks or Whole Foods gift certificate, as a client gift, this is considered a MEALS expense (so only 50 percent is deductible) NOT an advertising expense (100% deductible). In order to deduct client gifts at 100 percent you need to buy gifts that aren’t food such as spa packages, flowers, Home Depot gift certificates etc.. Additionally you need to make sure you note which client received what gift in case you are audited.
If you receive a T4 from your employer, you are not eligible to deduct ANYTHING unless your employer fills out a T2200 form authorizing you to do so. That said any dues or insurance you purchase from professional organizations can be deducted so long as you have been designated as a professional.
Unfortunately, as a student, you are not allowed to deduct any additional expenses beyond what your tuition slip from your educational institution (T2202) indicates. Therefore items such as your computer and stationery supplies are non-deductible.
When filing your taxes it is important to keep in mind that from the CRA’s perspective anything that could be deemed as personal, WILL be deemed as personal in the event of an audit.
Although you can take the risk and claim the above expenses you really should not, because in the event that you are audited and your claims are denied you will be forced to pay a fine in addition to paying back all of the tax you avoided along with interest.
We are taking appointments for tax consultations now so if you want to get ahead of the rest and book your ideal time contact us now.
Feel the burn? Power through tax season like a champ with these sassy moves. Stretch your tax worries away. By Anja Konjicanin
At the Homeroom office, we have set ourselves the challenge to stretch every day.
So we get up every two hours for a break from the chair.
Great warm-up for tax season, right?!
These movements may not be much but the consistency with which they are repeated makes all the difference toward a long healthy life. Because a little bit goes a long way with these office-friendly stretches that keep on giving!
We are doing it for the forever healthy, happy, energetic body. What’s your WHY?
Sit Less, move more, do more, feel great:
1. Neck mobilization (6-8 reps): Keeping your chin up turn your neck side to side with a pause and hold on each side. With your chin pointed down toward your chest roll your chin from shoulder to shoulder in gentle half-circle.
2. Shoulder and upper back openers (6-8 reps): Arms are in front of your with forearms and palms together. Separate your arms keeping them at a 90 degree angle push back until you feel your upper back squeeze together. Keep your back squeezed raise your arms over your head. Return to the first position and repeat.
3. Wrist and hand stretch and mobility (6-8 reps): Arms are extended straight in front of your body. Flex or roll wrists and hands.
4. Good morning twists (6-8 reps): Arms are crossed against your chest. Keeping your head up and back straight hinge at the hips moving your chest toward the ground until you feel a stretch up the back of your leg (hamstrings). Hinge up to standing erect pressing your hips forward until you feel your bottom (glutes) flex tight. Then standing straight and tall twist to the right, return to the middle and twist left. Start at the first position and repeat as directed.
5. YTUW Back, Glutes, and Hamstrings Hinge (3 reps): Standing straight and tall push your glutes out (stick your bottom out). Raise your hands above head then move your arms down into a “Y” position, then “T”, “U”, “W”. Return to hands above head. Hinge forward keeping your head up and back straight until your hands come to rest on your desk or other flat surfaces. Slide your fingers forward on your desk feeling a stretch down the back of your body. Return to standing and repeat as directed.
6. Split Stance Tilt for calves and hip flexors (2 reps pers leg): Part 1 – Standing tall with feet shoulder width apart. Step forward into what would be a natural stride keeping your back heel pushed down to the ground. Push your hips forward toward the front foot keeping your chest high and your head up. Part 2 – In the same stance look up and fully arch your back and tilt your hips up and away from your back leg. Return to standing shoulder width and repeat with the other leg.
7. Ankle circles (2 reps per side): With your toe pressed into the ground make small circles rolling your ankle in one direction and then the other.
Small daily actions go a long way. They can keep you healthy, stress-free, and organized.
As soon as the government started talking about tax reforms for corporations who used income sprinkling as a tax saving strategy small business owners across Canada started to worry about the implications these impending changes would have on them.
Before we dive in and give you the full ins and outs of this tax law change, who it impacts, and what it means for small business owners we want to start by saying that majority of our small business clients will not be impacted by these changes. Those impacted the most are high-income earning professionals, such as Doctors and Lawyers, who have been income splitting with a spouse who is not actively working in their business.
Income sprinkling aka income splitting is a tax strategy commonly used by higher-income business owners or incorporated professionals to help them personally access more funds from their corporation without the high tax bill. To implement this strategy the corporation pays out company dividends to a lower earning family member of the business owner or incorporated professional, in most cases a spouse or child. The family member receiving the funds is taxed at their tax rate, which is lower than the higher income earners tax rate.
The original law around income sprinkling/splitting was the Tax on Split Income (TOSI) rule which applied the highest marginal tax rate to income that was split with a family member under the age of 18. Commonly known as the “Kiddie Tax” this law had not been extended to family members 18 or over.
You can probably already see the writing on the wall and if you assumed the new law extends the principles of the “Kiddie Tax” to all family members 18 and over who receive dividend payments from the corporation without actually being an active member of the business, you would be correct.
It should be noted that there are some exceptions to the rule:
For a majority of small business owners, these changes don’t pose a significant impact. So long as your family member is actively working within the business and can provide documentation to prove that fact the high tax bracket won’t be applied.
For a lot of incorporated professionals that have been income splitting with a spouse who does not actively work in the business these changes will have a significant impact on their tax saving strategy.
The current minimum wage in BC as of June 1st, 2018 is $12.65 and that number is expected to rise steadily in the coming years. As small business owners in one of Canada’s most expensive cities, it should be no surprise that minimum wages are increasing. Many small business owners are already paying well above minimum wage to align with the cities livable wage of $20.91/hour and retain good talent.
Minimum wage increases are often met with mixed reviews from business owners. While some feel it will fuel the economy as employees will have more money to spend and create happier workplaces, others feel it will have a crippling impact on small business owners and their bottom line.
No matter what your point of view is on minimum wage increases the fact of the matter is – they are coming whether you like them or not. Here are 3 ways that you can make sure you are prepared for the increase.
Inefficiencies, products and services with low-profit margins, and outdated systems tend to stick around longer than they should when a business is thriving. When a minimum wage increase hits and payroll taxes and accounting fees go up the reactionary approach for a lot of business owners is to start thinking about employee cuts because at face value higher wages appear to be the problem.
Rather than hastily cutting staff or treating your employees differently now that they cost more we recommend turning your focus on your business and getting real with yourself. Ask yourself when was the last time you shopped around to ensure your insurance policy, bank account fees etc. were the best price? What parts of your business could be automated with the right technology? Which product or service lines have small margins and should be cut? What systems can be upgraded?
Doing a thorough audit of your business, reviewing your profit margins and investing in better systems can save you thousands long term. Helping you stay on budget when minimum wage increases are announced.
It’s not always ideal but it is better than laying off good staff. If you have a storefront or provide services a lot of overhead can be reduced if you are smart about your operating hours and your scheduling. If your sales are low on a Tuesday and only barely cover your operating costs then maybe there is no need to be open that day. Or if you notice that most of the work is completed from 9am – 3pm and from 3pm – 5pm nothing gets done, reduce your teams daily hours to 9am – 3pm until you can ramp back up.
While reduced hours isn’t ideal for your existing staff it’s much better than no hours.
While this isn’t always ideal it’s a very viable option to manage a minimum wage increase. With inflation prices can’t be expected to stay the same forever and when minimum wages increase it’s common for the cost of goods to increase with them. Talk to your bookkeeper to determine what the deficit is with the wage increase then look at how you can recoup that with incremental price increases across your products or services. So long as you continue to ensure your level of service remains high most customers will stay loyal.
A lot of small business owners in Vancouver are already paying above minimum wage to ensure they can retain talent so when wage increases are implemented the impact is minimal. If you happen to find yourself in a tight situation when the next increase is announced talk to your bookkeeper or accountant and look for ways to trim the fat from your business that are win/win for both you and your employees.
Unless you have been living under a rock we assume you’ve heard the speculation about Speculation Tax (see what we did there). The speculation tax is designed to help make the housing market of urban areas more affordable and available by encouraging homeowners to rent out their homes and not leave them vacant. The areas affected include Metro Vancouver, the Capital Regional District (excluding the Gulf islands and the Strait of Juan de Fuca), Kelowna, West Kelowna, Nanaimo-Lantzville, Abbotsford, Chilliwack and Mission.
The speculation tax while seemingly terrifying, because, you know it’s potentially going to mean you pay MORE TAX will actually only impact 1% of residents and homeowners with BC properties.
The types of homeowners that will be impacted are:
(https://workingforyou.gov.bc.ca/speculationtax/)
The 3 types of people who fall into the speculation tax bracket will have to pay the tax, rent their home out, sell or simply move in full time.
Approximately 99% of people not affected by this new tax. If you own a home and live there all year, if you rent your home for at least 6 months of the year, if you don’t even own a home and are renting or if you own a home outside if the areas that were mentioned above, this new tax won’t impact you. Additionally, if the following apply to you then you are exempt – you are in the hospital or going through medical care, if you are temporarily away from home because of work, if you are in long-term care or in a supportive care facility or if the homeowner is deceased.
The Speculation Tax is aiming to improve livability in popular BC areas by encouraging homeowners to rent out their properties creating more access to housing which is a really BIG positive.
There are also a lot of measures in place to help make the tax more bearable. If you are a BC resident you will be eligible for a tax credit, the maximum amount for this is $2000, and $2000 isn’t something to scoff at. If you own 2 homes the Speculation Tax will only be applied to one of your homes, which is also a bonus. The tax itself is also so easily avoidable if you just rent out your second home or even sell (which is extreme but an option nonetheless). You can also completely avoid the tax if your home is valued at less than $400,000.
Even though there are exemptions in place to protect residents these exemptions take 3 months to be approved so this can be a real set back for some people. There is also a lot of chatter about the tax impacting the value of recreational homes in the areas where it is enforced, which could have a negative impact on tourism.
Some people have been petitioning against the Tax due to all of these cons, which is really not helping the Tax move along smoothly. It’s almost like a tightrope walk at this point, no one really knows what’s going to happen in the future as so many people are all for the tax and so many are completely against it. While the tax has been approved and implemented who knows how long it will remain in place.
As the sharing economy continues to grow an increasing number of startups are being developed that provide everyday people with the opportunity to increase their income streams. This is causing the average person’s tax return to become much more complicated than it would be with a simple T4 income.
First things first YES you need to claim your AirBNB income. It may be your “fun money” but to the government it’s income and it won’t be fun income if you don’t claim it and the government finds out.
Airbnb income is considered rental income so long as you don’t include meals, personal laundry services, and other tourism services to your guests, in that case, it’s going to be business income.
If it’s confirmed rental income you need to complete a T776 (Statement of Real Estate Rentals) and declare the income on line 126 of their federal return.
The benefit of claiming this income is that unlike T4 income you can claim your expenses to offset the total net income.
When calculating your expenses you need to make sure that you calculate the correct percentage. You can only claim operating costs for the time your property was generating revenue.
For example: If you rent out your entire place for 165 days of the year (45% of the year) and make a total of $11,000 and over the course of the year the claimable expenses you incur on the property (eg. property taxes, strata fees, insurance) are $15,000, you can only claim 45% of this amount (ie: 165 days worth of expenses) so – $6781. Making your net income $4219. Expenses that relate directly to the rental such as replacing sheets and cleaning fees that you incur over those 165 days are 100% deductible.
If you only rent out a room in your house then things become a little more complex. You need to go a few steps further and separate out the expenses that directly relate to the room you are renting (linen, decorating etc.) and divide them by the percentage of use (as demonstrated above) in addition to calculating your rental operating expenses for the house dividing them by the percentage of the year the room was rented AND then again by the percentage of the house used to generate income.
For Example: If you rent out a room in your home (¼ of your house) for 200 days of the year and make $10,000, the claimable expenses for the entire home $12,000 annually and the expenses relating directly to the room were $1500 annually.
You can only claim the following – The operating costs throughout the time you made the income (200 days of costs) will be $6575 for the entire home. This then needs to be divided by 4 as only ¼ of the home was rented out so $1644 can be claimed.
In addition, you can claim $822 worth of expenses for the $1500 of furniture you purchased that was used for rental purposes 200 days.
The following is a list of expenses that are deductible:
Each can be explored in more detail by visiting the link.
If you are unsure of what you should and shouldn’t claim we recommend filing your return with a tax professional. What may feel like a saving by not paying for advice now could cost you later if you are audited and forced to pay penalties and interest on overdue funds.
When measuring the success of a marketing plan a lot of business owners make the mistake of only focusing on website views, social media likes, and new leads. Don’t get us wrong, these key performance indicators (KPI’s) should be measured and reviewed regularly BUT to ensure that you are heading in a truly profitable direction you need to take your marketing and sales planning a step further. Talk to your bookkeeper or accountant to figure out how to accurately measure the following data so that you can use it to drive your marketing strategy.
Knowing the net revenue of each client will help you accurately determine who your most profitable clients are, which clients (if any) are costing your business money, and who you should be targeting with your marketing and sales efforts. It’s easy to make assumptions when it comes to client profitability and use these assumptions to drive your sales and marketing efforts.
For example: Henry owns a construction company with 3 key target audiences – New developments, luxury home renovations, luxury home builds. He made the assumption that new developments are his ideal target audience as they are long-term contracts, their invoices run into the millions and they allow him to build and maintain a large team. Reviewing his true net revenue by target audience revealed that after labour costs, overtime, materials, project management costs, accounting, office management, legal fees and delays that this target audience wasn’t as profitable as he originally thought and that his renovation clients were actually more profitable on average.
While there may be times when your assumptions are correct we always suggest trusting your numbers rather than your gut when making strategic marketing decisions.
How do you find your clients? What is your cost of advertising to each target audience? How many hours a week do you spend on marketing and sales? How long is your sales cycle? How much time does each marketing activity take? These are all questions you need to know the answers to so you can determine which clients are worth pursuing and which marketing efforts are the best ones for obtaining them.
For example: Sally owns a yoga studio and to attract her ideal client she advertises on Instagram & Facebook, writes one blog a week and spends 2 hours a week networking. On average Sally brings in 6 new clients a week who purchase the introductory class offer which is $40 for the month. Out of the 26 new clients per month, only 5 continue on as annual members after the intro offer expires.
When Sally breaks down her time and costs and income it looks like this:
Social Media Advertising – $600 per month – Brings in 15 clients per month = $40 per lead
Writing a weekly blog – 10 hours per month x Sally’s rate of $60 per hour = $600 – Brings in 3 clients a month = $200 per lead
2 Hours of Networking – 8 hours per month x Sally’s rate of $60 per hour = $480 – brings in 8 clients a month = $80 per lead
Total marketing = $1680 per month
Total income from the months marketing efforts = $1040 for month one, $600 for month two
So for each month of marketing, it takes 2 months for the efforts to break even and the average cost per new lead acquisition is $65.
Sally dives deeper and realizes that the clients who are most likely to continue after the introductory offer are women in their 40’s who have back issues that she targets through her Facebook advertising and people she has built a personal connection with through networking.
Looking at the numbers Sally determines that writing her blog isn’t worth her time and puts that money into social media advertising. She spends more money targeting the demographic that is most likely to continue on an annual membership and as a result, triples her monthly leads. Her cost per lead is reduced significantly, her revenue has increased and she has saved herself 10 hours a month of writing tasks.
Without diving deeply into your marketing efforts and measuring the ROI of each effort you won’t be able to streamline and improve your marketing strategy and long term revenue.
It’s widely known thanks to Pareto principle that 20% of your customers generate 80% of your revenue. This is why knowing your CLV is so important. This metric is an easy calculation and essential number to know when reviewing your retention strategy and determining your future target audiences.
To calculate the lifetime value of a client simply add up the gross profit they have brought to your business over the course of their time as a client. In addition, it’s beneficial to note the length of time they have worked with/ purchased from you and if known how they found your business.
You can use this information to create target audience personas that are based on your most profitable clients for marketing purposes, to help with the creation of client appreciation campaigns, account development, and retention plans and to predict your future revenue.
For Example:
Jennifer owns an e-commerce business and spends a lot of money marketing her products on social media to attract new clients. Once Jennifer started measuring her CVL as a key metric she was able to determine which campaigns were the most profitable long-term, cut the campaigns that were only bringing in one-off clients and build stronger nurturing and retention campaigns to keep customers who were loyal to her store coming back, increasing her overall revenue.
In this new era of online marketing what was once thought of as a creative, whimsical industry filled with fun swag and events has turned into a data-driven almost scientific one that relies heavily on the bookkeeping and accounting industry.
To ensure that your small business continues to grow successfully you need to make sure you talk to your bookkeeper or accountant to solidify that your growth strategy makes sense and that your marketing spend is bringing you the right ROI.
Your mother clearly dropped you on your head as a child and as a result, you decided that you wanted to be an entrepreneur when you grew up. You took the leap and low and behold the crazy idea you had actually worked out and business is going great but you are at a tipping point where you either need to expand or start turning away business. Sound familiar?
While it’s always tempting to keep welcoming growth and leap into the opportunity to expand it’s not an easy black and white decision. You need to be strategic and know your cost to benefit ratio to ensure the decision to expand will actually be good for your business and not harm your bottom line long term.
Here are 5 things you need to consider when determining if taking the leap makes sense
This may seem like an obvious question that is easy to answer but it’s not as simple as it sounds. An expansion, whether it’s of a physical space (ie: retail location) or simply bringing on new team members to manage demand is a money sucker in the beginning.
You need to make sure you can afford any closures, renovation, and new inventory costs as well as any hiring and training costs in addition to your regular operational expenses.
Ideally, you want to have this money saved and only finance the expansion after discussing your numbers in detail with your accountant to confirm the additional costs make sense.
How long will it take you to make back the money you spent on expanding? In most cases, expansions don’t happen overnight and increased profits aren’t guaranteed as soon as you open your new door. You need to know how long it will take for you to break even after an expansion so that you can ensure you have enough money saved to cover your increase in ongoing costs in advance.
We say this in every post for a reason – because it’s essential if you want to grow a strong, profitable business and make smart, strategic decisions.
Without knowing your numbers you can’t accurately and successfully plan an expansion. You need to understand your cash flow projections so that you can create a financial plan designed to help you survive your worst case scenario and a marketing plan to achieve your best case scenario.
Don’t rush into an expansion simply because you experience a burst of requests and it feels like demand is there. Research your target audience thoroughly and ensure that the demand is real and ongoing. You may discover that demand is seasonal, much smaller than you anticipated or can be addressed with some extended hours or a few special order requests.
Making the decision to expand isn’t going to be easy but completing a thorough analysis of the costs, benefits, and demand will ensure that when you make the decision it’s strategic and optimized for success.
If you need help understanding your numbers and determining if an expansion makes sense for you contact Homeroom today!
It’s safe to assume that Vancouverites LOVE their Yoga. There is no shortage of studios in this city and a most of the time they are filled to the brim with people gaining strength and learning to control their breath. Even though we have a large community of Yoga lovers in the city you can’t ignore the fact that competition is fierce and if you want to remain in the game you have to stay innovative and manage your business well.
Here are our top tips for staying zen and remaining profitable
I know that it seems like we are trying to trick you because we are a bookkeeping company but we can confidently say even if we were in the jump rope industry this would be our advice.
Many studios make the mistake of getting the reception team to take care of duties such as payroll and bookkeeping. Your reception teams number one focus should be providing exceptional customer service so that your customers have a great experience.
Constant distractions and inexperience can lead to costly mistakes by creating the ideal environment for data entry errors. By outsourcing your payroll to a reputable provider you can ensure that you are deducting the correct amounts from your employees AND remitting the correct amounts to the government.
Reputable providers take responsibility for any errors and therefore are much more thorough with their entries. They also know the tax laws inside and out, protecting you from unnecessary penalties.
This may seem like an obvious simple step but you would be surprised how often businesses set up their sales software and tax amounts incorrectly. Ensure that all your sales (from all sources) are recorded in Mindbody (or whatever software you are using) correctly. Have a professional double check your set up to ensure that you are charging the correct taxes and that the money that goes into your bank is properly recorded as income.
The last thing you want to do is discover after several months of taking payments that you aren’t charging your clients correctly or recording your payments effectively. This can lead to significant losses, especially if you end up having to pay additional taxes from your own pocket.
One of the easiest ways to avoid unnecessary expenses is to pay your bills on time, taxes included. Ensure that all your PST/GST returns and payroll taxes are filed and paid on time to avoid late filing penalties. If you find deadlines difficult to manage in-house then hire a professional bookkeeper to manage this element of your business. The CRA won’t tell you if you’re early or have overpaid but they will be quick to seriously penalize you for being late.
Businesses tend to ebb and flow. Make sure you have a clear understanding of your fixed costs and create and maintain a monthly cash flow budget so that you can avoid stress during slower periods.
In addition to offering your services create passive income when possible, rent out your space to other professionals and community groups during your down times to maintain your income.
During our time offering bookkeeping services to Yoga studios around Vancouver, we have seen all the common mistakes that Yoga studios make and the great ideas that work. If you have a yoga business and need help with your bookkeeping don’t hesitate to contact us today.
