small business bookkeeping, career, quickbooks, career search

How Construction Trades can keep the CRA happy

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As a tradesperson, you may think the taxation department is out to get you and to be honest you might be right. Construction is a red flag industry due to the number of small suppliers and short-term workers who do cash jobs. So we can’t stress enough how important it is to declare your income honestly if you want to avoid penalties!

Here are our 4 top Tips on how to ensure you keep the CRA Happy

Create Accurate Invoices

If you want to be able to sleep at night knowing that you have nothing to hide then you need to ensure you are creating accurate invoices for all of your jobs. This way if the CRA comes knocking at your door you have everything you need to prove you aren’t hiding income.

Use a software like Quickbooks Online to create your invoices. This will help you ensure all invoices are accurate and stored in the one place. It will also save you a lot of time and money when bookkeeping.

Sub Vs Employee? Know the Difference

The most costly mistake a lot of construction business make is to pay people who should be categorized as an employee as a sub. A quick test to ensure your sub should not be paid as an employee is to ask yourself these two questions.

Does your sub have their own GST and WCB numbers?

Do they own their own tools and take on other jobs besides yours?

If the answer to both is YES then you can pay them as a sub. If they answer NO then you MUST pay them as an employee.

The government doesn’t like missing out on employment taxes so the penalty for incorrect categorization includes back paying payroll taxes INCLUDING the employee’s portion as well as paying penalties and interest.

Need Help With Your Bookkeeping? Contact Us Today

Charge GST

GST stands for Goods and Services Tax, not Great Sunny Times. It’s not an optional fun tax…It’s MANDATORY. GST needs to be charged on EVERYTHING you invoice. Yes, you need to charge GST on your materials. At the end of the year, your total GST collected needs to be 5% of your total sales. If it isn’t, the CRA will want to know why and you will be liable for the GST that you should have charged.

Get Help

Managing your bookkeeping on top of managing your business is challenging. Most contractors and construction companies we work with come into the office with plastic bags filled with receipts and invoices so we know how easily this part of the business can fall through the cracks. Knowing your numbers and ensuring you are compliant is an extremely important part of your business and shouldn’t be ignored.  Hire a professional bookkeeper who can keep you on track and make sure you are compliant with all your filings.

If you need help with your bookkeeping contact us today for an obligation free quotation.

Need Help With Your Bookkeeping? Contact Us Today

Xtreme-EffeX: Extremely creative and innovative design with impact

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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:

 

What motivated you to start your own business?

“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.”

What do you enjoy most about being a business owner?

“Through hard work, the freedom and ability to create a schedule that benefits me, and especially my family.”

 

What’s your favourite part about the fabrication industry?

“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.”

 

What’s your #1 motivator?

“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.”

 

Describe your ‘a-ha’ moment

“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.”

 

What’s your vision for the business?

“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.”

 

What advice do you have for other people who would like to start their own business?

“‘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

 

How do you achieve a work/ life balance?

“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.”

 

Who could benefit from your services?

“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!

 

Five ways your business will benefit from having a professional bookkeeper

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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.

Here are five ways your business will benefit from having a professional bookkeeper in your corner:

  1. We take on your deadlines. We take this so seriously that we will pay for late filing penalties that you incur if we miss one of your deadlines.
  2. If you have cash-flow problems and owe money to the CRA for your various accounts, we can help prioritize your payments so that you are incurring the least amount of penalties.
  3. Do you have employees OR you pay yourself a salary and remit source deductions?
    1. It is very easy to mess up payroll. We have found this is the number one area that clients always do incorrectly if they are doing their own bookkeeping. Even though the CRA has the online payroll calculator available to everyone, we have yet to see someone that has used it correctly.
    2. Consequences of payroll mistakes:
      1. Penalties and interest for late remittances are assessed on a monthly basis.
      2. Payroll non-compliance is considered by the CRA to be the worst offence. Eg We had a client who “did” her own T4. She calculated her own deductions, remitting wrong amounts and didn’t even file the T4 resulting in late filing penalties. This was a highly educated professional in her field who mishandled payroll. Even if you only have yourself on the same salary every month, it is still possible to do it incorrectly.
  4. We will not file a return that is not reasonable by CRA standards.
    1. Our job is to keep you off of the CRA radar. We have filed thousands of returns of all types. We will let you know if a return does not make sense before we file it and could cause the CRA to investigate it. We will work with you to make it reasonable.
  5. We have not had an audit that we were not expecting.
    1. Certain types of returns are red flags for audits eg. large GST refunds. We anticipate this, let the client know in advance that we are expecting this, and tell them how we are going to handle it.

Leave the books to your professional bookkeeper buddies and focus on what you love! 🙂

Why having a professional bookkeeper is important for the success of your business

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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?

Here are five reasons why having a certified bookkeeper on your team of professionals is important for the success of your business:

  • Corporations: We know what an accountant needs to file your corporate year-end
  • Actually reconciling your bank and credit card to the statement balance. It is more complicated than just checking off everything in the bank rec screen in Quickbooks. Go figure!
  • Reviewing all of your accounts for accuracy and highlighting any issues so that the accountant knows where to direct his/her attention
  • We will deliver your year-end in a reliable software that the accountant is used to
  • Sole Proprietor: We know what is needed to complete your year-end so we can file your tax return and/ or GST/ PST returns

Why is all this important?

  • You will save on accounting fees if the accountant receives a clean set of books in a format they are accustomed to seeing
  • The accountant and bookkeeper speak the same language. You will save time because the accountant will ask the bookkeeper questions about the year-end instead of asking you
  • Sole proprietors: similar to above, but we will do your bookkeeping anticipating doing your tax return at the end of the year. We will look/ask you for any additional write offs that you may not have provided to us based on other businesses in your industry. Our job is to ensure that your tax liability is as low as possible while still compliant with the CRA rules
  • We will ensure that you get the maximum write-offs possible based on our experience filing thousands returns
    • We will ask you about certain items you might never have thought you could even write off eg: Business insurance, WorkSafe BC, Meals
    • We will ask you about incomplete entries we think should be there eg do you have certain months missing for rent or telephone? Did you pay for utilities?
    • Forgot your bank and credit card statements? We will send you a reminder to send us your statements with any additional business expenses that may not be in your folder
  • We will review your expense totals to make sure they are reasonable

Stay tuned for next week’s post to see how your business will benefit from having a professional bookkeeper on your team!