Chartered Professional Accountant, Experienced Bookkeepers, Personal and Business Tax Return Specialists - Whitby ON - Call - Toll Free: 1-800-942-5558 or Local: 905-666-5071 admin@kmpc.ca
Spring 2021 Newsletter – Tax Season is Just Around the Corner!

Spring 2021 Newsletter – Tax Season is Just Around the Corner!

Tax Season is Just Around the Corner…

It is hard to believe that tax season is here already! Covid 19 has made the past year challenging on so many levels. The pandemic has even impacted the complexity of tax returns this year.  In order to make the process of filing your taxes less confusing, I have recorded a video to explain how our office is managing the client tax return process, as well as giving some insights on topics like CERB and work from home tax claims.  Please take a few moments to watch the video so you can be prepared for the upcoming tax seasonClick this link to watch the video.

STOP THE PRESSES!!!!

CRA has just announced some updates that could affect YOU.  Watch this 3-minute update so you have the information you need for your tax return this year… click here for the update

KMPC is now offering online consulting services. Conveniently accessible from our website, you choose which timeslot works best with your schedule and book it right on our website!
Take a look… 

New Webinar – Coming Soon!

In response to the many discussions I have had with clients over the past few months regarding the pressures of the Pandemic on businesses, I will be offering an online webinar series that will showcase concrete strategies that business owners can use to lessen the strains resulting from the challenging new landscape of the pandemic. Please visit the information page on our website to learn more about the webinar series and to sign up for the series.

The KMPC team specializes in helping companies grow via strategic financial management practices. Since 1993, KMPC has been helping businesses in Whitby, Oshawa, Ajax, Durham Region and the Greater Toronto Area (GTA) to reach and surpass their profit goals.

If you would like to speak to us regarding  Business Accounting, financial  retirement or tax planning, tax returns, bookkeeping or any of your other  please contact us anytime – we’d love to chat with you.

KMPC– Chartered Professional Accountant, CPA 11 Stanley Ct, #13 Whitby, ON L1N 8P9  (905) 666-5071 

Email: admin@kmpc.ca  Web: https://kmpc.ca

Should I Incorporate My Business?

Should I Incorporate My Business?

This is a question I have been asked many times by small business owners during my 26 years as a Chartered Professional Accountant. The answer, however, is not a straightforward one. Recent tax law changes have removed some of the benefits but there are still some key advantages that warrant serious consideration for incorporating a small business.

When you incorporate your business, it is considered to be a legal entity that is separate from its shareholders. As a shareholder of a corporation, you will not be personally liable for the debts, obligations or acts of the corporation. It is always wise to seek legal advice before incorporating.

Benefits of Incorporating:

  • Limited liability
  • Ownership is transferable
  • Continuous existence
  • Separate legal entity
  • Easier to raise capital than it might be with other business structures
  • Possible tax advantage as taxes may be lower for an incorporated business

For more details visit the government’s webpage on this topic.

If you do decide to incorporate and you have a lot of value in your sole proprietorship business such as, receivables, inventory and fixed assets, you need to do something that’s called a Section 85 rollover. That’s basically where you take those assets and transfer them into your incorporated business. You can’t simply start an incorporated business and ignore all the assets and issues from your sole proprietor because it doesn’t simply magically disappear in a puff of smoke. You must shift those assets into an incorporated company.

It’s important to follow the proper process while making the shift because you do not want CRA (Canadian Revenue Agency) auditing your transfer protocol. In CRA’s eyes this needs to be tracked on paper as though it was a sale of a company.  CRA may interpret any lack in protocol as an intent to evade some taxation issues if you do not properly addressed all of the issues with your sole proprietorship before starting an incorporated company. Be sure you understand the process and follow it to the letter of CRA so that you don’t create unnecessary problems for yourself. Click here to learn more about the process

If you are considering moving your company from a sole proprietor to an incorporated company and are not sure about all of the ins and outs of the proper process please contact us for an appointment to sit down thoroughly review your options and which path is best suited to your company.

 KMPC: Outstanding Chartered Professional Accountant, Bookkeeping and Tax Preparation Services

The KMPC team specializes in helping companies grow via strategic financial management practices. Since 1993, KMPC has been helping businesses in Whitby, Oshawa, Ajax, Durham Region and the Greater Toronto Area (GTA) to reach and surpass their profit goals.

If you would like to speak to us regarding  Business Accounting, financial  retirement or tax planning, tax returns, bookkeeping or any of your other  please contact us anytime – we’d love to chat with you.

KMPC– Chartered Professional Accountant, CPA 11 Stanley Ct, #13 Whitby, ON L1N 8P9 – Local: (905) 666-5071 – Email: admin@kmpc.ca  Web: https://kmpc.ca

KMPC’s Updates from CRA

A few updates that you should know about…

Mileage Claims:

(Please Note Update for 2019 Tax Year – The mileage rate is 58 cents for the first 5,000 kilometres and 52 cents for the balance of the kilometres.)

2018 only…Automobile, the kilometre allowance went up a cent so it is now 55 cents for the first 5000 km and 49 cents for the balance. Remember, if you are paying by kilometre you must have an auto log.

My Account

If you don’t have one you need to get one.  From your my account you can retrieve your notice of assessments, CRA will send the status of your return to your My Account,  you can get balances of home buyer’s plans, RRSP limits …all kinds of great information. Now you can get a mobile app “My CRA” try it!

CRA tends to send out requests for documents and they may not give you a lot of time for this, don’t panic just call the number on the letter and request for more time, they are good for that.

New Economies

As of March 19th,  2018 CRA is jumping on the Airbnb wagon, they will be ensuring that this home-sharing income is reported. This is considered rental income and must be claimed. In fact, all sharing economies are being looked at i.e.: ride sharing, music and video streaming, online staffing, peer/crowdfunding are to name a few that these sharing services must be claimed as income when earning income from these, if not CRA considers it underground economy which may attract fines, penalties or even jail times.

Payment Arrangements with CRA

Payment arrangements, CRA is cracking down on payment arrangements, Last time I dealt with a situation for a client, the collection officer said, before we will even discuss it, I want to see cashflow statement, net worth, a letter from a bank stating they will not loan any money to this client.  If anyone is struggling to pay their debt with CRA there are two tools you can use to see what you think they will allow.

*One is a Payment Arrangement Calculator  – this will estimate the payments and time needed to eliminate the debt

* Two is Income and Expense Worksheet Calculator this helps calculate the part of the one’s net income that is available to pay the tax debt

Payroll Examinations

Lots of these are happening, why?  They are trying to catch any firm that had employees and are now subcontractors so if your payroll dipped down most likely you will receive a letter asking to provide payroll information and bank statements with cheques.  No need to panic if nothing like this has happened.  If you did move people off payroll and are now subcontractors a few things must take place for them to be true subcontractors.  There is a guide on CRA’s website Canada.ca called Employee Versus Subcontractor and it will tell you the status of both to confirm if you can move them to be a subcontractor.  The other situation you have is if CRA’s status says yes, they can be a subcontractor that does not mean WSIB will determine that they are a subcontractor so you need to do a status determination with WSIB using different criteria.  Please ensure you do this, so you are not on the hook for WSIB especially when you didn’t plan for this.

Last Returns

Another issue that has come up more and more and that is the amount of final returns that are happening, when a loved one dies, and you are the executor there is a big responsibility to making sure things go smoothly.  On CRA’s website type in What To Do When A Loved One Dies .  There are forms to fill in so that everything goes smooth.

Celebrating 25 years in Business!

Open house! We are having an open house Nov 23rd from noon to 6pm.  I must apologize, for those who have been to my office, our parking lot is now going to be torn up a bit due to a pipe needing replaced and construction starts Nov 7th, however, they will have a pathway for us to drive back to our unit, I do apologize for this inconvenience. I can guarantee once you pass that mess you will arrive at our office and inside we will have amazing good food and the first 100 people will get a little gift. I hope you can join us to celebrate our 25 years in business! We are excited, and I want to thank all my amazing clients because of you I have grown from just me alone to 6 people  – soon to be 7 !

The KMPC team specializes in helping companies grow via strategic financial management practices. Since 1993, KMPC has been helping businesses in Whitby, Oshawa, Ajax, Durham Region and the Greater Toronto Area (GTA) to reach and surpass their profit goals.

If you would like to speak to us regarding  Business Accounting, financial  retirement or tax planning, tax returns, bookkeeping or any of your other  please contact us anytime – we’d love to chat with you.

KMPC– Chartered Professional Accountant, CPA 11 Stanley Ct, #13 Whitby, ON L1N 8P9  (905) 666-5071 

Email: admin@kmpc.ca  Web: https://kmpc.ca

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