WizeBiz - Latest Comments

Re: Haven’t Received Your T4? Find Out How to File Income Tax

Cecilia Leung — Sun, 08 Mar 2015 15:22:02 -0000

test dicussion

Re: How Small Business Payroll Toronto Services Save you Money

small business payroll — Fri, 11 Jan 2013 01:56:12 -0000

The legal definition of small business varies by country and by industry. In the United States the Small Business Administration establishes small business size standards on an industry-by-industry basis.. Thanks for this post..

Re: How to Pay Yourself – Corporation

Cecilia Leung — Tue, 31 Jul 2012 16:58:48 -0000

Hi Ty,
The best way is always to pay yourself as little as you can, simply because the corporate tax rate is lower than personal income tax rate. Everyone has a basic exemption of $10822 in 2012. You can 12k with 10822 no tax.
Cecilia

Re: How to Pay Yourself – Corporation

Ty — Sat, 28 Jul 2012 18:34:29 -0000

hi Cecilia,

I have recently incorporated my small business. I provide consulting services to one cutomer and the sub contracting company then pays my corporation. I am wondering what the best way is to pay myself without paying a large amount of tax. Total corporation revenue will be approximately 24k. I would like to pay myself at least 12k.

Thanks,

Re: How to Pay Yourself – Corporation

Steve Campbell Inc — Thu, 28 Jun 2012 01:47:51 -0000

Yes this acceptable, providing the receipts are in your name and not the company's.

Re: Haven’t Received Your T4? Find Out How to File Income Tax

Luke — Mon, 14 May 2012 16:19:30 -0000

From 2006 to March 2012 I was living in The States but not working I was volunteering at a Church Ministry. Do I have to file taxes for these years even though I was not working or living in the USA

Re: How to Pay Yourself – Corporation

Smallconsultant — Wed, 02 May 2012 12:18:23 -0000

Hi, I have worked for many years as a sole proprietor consultant and claimed on my personal taxes. I have just been offered a new contract however the company only wants to pay to my company if I agree to incorporate. I would like to like to open the corporation as a new entity and invoice the corporation from my sole proprietorship. I would like to invoice for 100% of what is paid to the corporation and continue to show all my expenses at the sole proprietorship level. Is this acceptable?

Re: Haven’t Received Your T4? Find Out How to File Income Tax

Daljit8dec — Sun, 15 Apr 2012 09:40:44 -0000

i did not get my t4 slips.I worked in 10 diffrent companies.I got only 5 t4 slips.My account of revenue canada have been freezed.How can i check my t4 slips.Please give me soln.

Re: Haven’t Received Your T4? Find Out How to File Income Tax

rRick — Wed, 04 Apr 2012 01:23:21 -0000

ok here's one, what if U were getting paid every 2 weeks from your employer and not be taxed, it says that U should file because It is a criminal offence not to report your income ... do U the math, they will rake yeah in taxes and they said U should because U might get cash back ... your fawked by the goverment eather way

Re: T5 Penalties and Interest

Giovi5 — Fri, 09 Mar 2012 13:17:26 -0000

What if the bank doesn't deliver it by Feb. 28, do they pay us a penalty for holding us back on filing our tax return?

Re: How to Pay Yourself – Corporation

Tracy — Sun, 03 Apr 2011 11:03:29 -0000

In a few years I plan to stop working and no longer inject income into my CCPC (IT Consulting Services). To date I have been the sole director and common share holder, no Salary paid and only 2 years where the CCPC paid me via a Dividend. My CCPC Retained Earnings have grown and I don’t plan on selling my CCPC or leaving it as a legacy. I now believe I should begin planning a depletion (payment) of those retained earnings before there are personal tax implications due to future sources of income such OAS, CPP (from earlier employment contributions prior to my CCPC) and RRSPs(becoming RRIFs). And I believe it would be beneficial to deplete the retained earnings before I begin the process of dissolving the corporation, at which point any cash remaining in the corporation would still need to be paid out. It is my understanding that the 2 ways of being paid/depleting the retained earnings are via Salary or Dividends. I am considering the Dividend route since in my situation it will be taxed more favorably than Salary. Another consideration is to issue(sell) another common share to my husband, who could then also receive the equivalent amount of declared dividends. My husband and I currently have only minimal investment income and we have lived off of existing savings. We would have the CCPC declare dividends to the extent that it is favorable for our personal tax year. Here are my questions:
1. In my situation, would payment of annual Dividends be the most tax favorable method for depleting the CCPC retained earnings, before dissolving the corporation? Or is there some other method I should be considering in conjunction with paying Dividends? For instance, is there a way to pay the retained earnings as a “taxable capital gain” in order to apply against an individual’s previous years capital losses?
2. Are there any CCPC CRA issues with CCPC dividends being declared in a year when the CCPC has made no active business income and still has Retained Earnings?
3. I realize that by issuing a common share to my husband he will have an equal shareholder vote. Even though I am not concerned with this, are there advantages to instead have the CCPC set up a 2nd class of shares for issuing a share to my husband? One advantage I can think of is the ability to declare a different dividend for each class. Is it ok to have Common A share and Common B share classes and each with a different dividend payout?
4. Are there any CCPC CRA issues with only “annual” dividends being paid out year after year to shareholders, and never a Salary paid?

Re: How to Pay Yourself – Corporation

Ahmahndoode — Sat, 02 Apr 2011 11:49:07 -0000

I've been invoicing my corporation as a contractor and the corp issues me a T4A annually.
I have an upcoming meeting with the CRA, as they are taking the position that I cannot pay myself this way and must use of the above methods. I have read in another of your forums that you CAN pay yourself as a self employed contractor. I will be appealing the CRA's decision and need as much documented support as possible. I'd love to hear some comments on this!

Re: How to Pay Yourself – Corporation

Ahmahndoode — Thu, 31 Mar 2011 13:27:19 -0000

I quote your blog here:

"You can certainly pay yourself as you are a self-employed person. The catch of this method is that you will need to register yourself a business number for your self-employee business. So now you have two business, one corporate, and one sole proprietor with two business number, and if you want to collect and claim GST, PST, or import and export, you will also need to register separate accounts for each business. When you file your personal tax, the amount invoiced to your self-employee business and your business expenses can be reported in form T2124 Statement of Business Activities or T2032 Statement of Professional Activities. (You can find this forms in the CRA website).

Hope this help.
Cecilia"

I have been paying myself in this exact manner since 2006. The CRA has contacted me to review this and says it is not allowed. I must pay myself either by dividend, loan, or salary. I would like to continue as self employed sole proprietor and pay myself accordingly from my corporation.

Where does it state in The Income Tax Act that I cannot do this?
thx!

Re: How to Pay Yourself – Corporation

Tracy — Sat, 19 Mar 2011 10:23:51 -0000

Thanks again Cecilia! I noticed the great services your company is offering. I am seriously considering one or more of them.

Re: Report Sales Taxes and Expenses in Quickbook

Cecilia Leung — Thu, 17 Mar 2011 16:25:37 -0000

You can record it as your normal expenses, it is an reimbursement. Yes you should separate out the GST as ITC.

Re: How to Pay Yourself – Corporation

Cecilia Leung — Thu, 17 Mar 2011 16:19:44 -0000

if you taxable income is less than 500,000, you are consider small business. Dividend or not will not affect the small business eligibility.

Re: Report Sales Taxes and Expenses in Quickbook

Goosusan — Thu, 17 Mar 2011 12:17:30 -0000

Paid Cindy (employee) $53.50 (includes GST) from Petty Cash for Gas Expense.

How do I record this, and do I separate tax out, if so, is it considered an ITC

Re: How to Pay Yourself – Corporation

Tracy — Thu, 17 Mar 2011 10:12:17 -0000

Hi Cecilia...just back visiting your wonderful website again and re-reading your response to my small business deduction question. I think I mis-read it the first time because of the use of the double "not"s. My corp taxable income is less than $500,000. Can you please confirm that it is ok to pay myself a dividend and my corporation would still qualify to use the small business deduction?
Thanks so much...Tracy

Re: 2008 Payroll T4 Deadline

Alishasmith89 — Mon, 07 Feb 2011 08:27:49 -0000

I had the same problem..iam worried about this years T$ (for 2010 year) any way you got this figured out a couple years back? advice on what you could give me? I had this employer not pay me on time, I left in october 2010 and still not recieved a ROE!!! any help would be great! email is alishasmith89@hotmail.com

Re: How to Pay Yourself – Corporation

PMP Cert — Thu, 30 Dec 2010 21:33:29 -0000

Should you pay yourself what you need to cover expenses? What your business can afford? The salary you left behind to launch your business?

Re: Late T4 Penalty

John — Tue, 30 Nov 2010 19:50:48 -0000

This site better get it's facts straight! According to the government website (which is never wrong yeah right) the costs are $10.00 PER DAY for T4's below fifty reporting with a maximum penalty of $1000.00

plus, you are considered guilty of not submitting even if you did by mail and they didn't receive it via government mail. So, send ALL of your submissions to the government via courier / registered signed mail or face getting fined!!! I have just spent three months and thousands of dollars on this issue. Makes me wonder what the hell i'm doing when I could be serving fries at McDonalds. When is the Canadian Governement going to realize that we don't live in Nazi Germany!!! I've been in business 20 years, it's not like this is my first kick at the can here.

Re: 2008 Payroll T4 Deadline

Cecilia Leung — Tue, 16 Nov 2010 18:55:18 -0000

Hi DMI, have you submitted a late T5 already? I would recommend you to do an amendment, however there is no way to avoid the late T5 fee. Did the CMA use efile and hence he/she is your representative? He/she should be able to negotiate with CRA for you and come to a term for the mistake. You can also contact CRA directly and let them know there is a mistake in submission.

Re: How to Pay Yourself – Corporation

Eric Offiong — Sun, 07 Nov 2010 17:19:40 -0000

Eric,
I live and run a small newspaper delivery business (.Inc) in Ottawa. I use Quickbooks 2010 pro to do my bookeeping, and Ceridian Powerpay to pay independent delivery contractors.
I only have 1 client (The newspaper company), and my expenses are mostly vehicle/office related. What do I need to do if I chose your company to file my T2 tax.
Please let me know by email: < info@jobizco.com > OR (613)728-1999.
Thank you (Your Website has been very helpful)

Re: 2008 Payroll T4 Deadline

DMI — Tue, 02 Nov 2010 10:37:14 -0000

Hi Cecilia,
I just received a very large bill from CRA for a late T5 for the 2009 tax year submissions. I have a business and rely on an CMA to do all of my taxes and filings on my behalf. I spoke with my accountant and the late submission was due to an error. She submitted a T3 by deadline, when it should have been a T5.
Is there anything I can do to get rid of the late fees? I.E. should I redo the 2009 taxes and submit it as an amendment and claim the income from the business as a trust vs a dividend?

Re: Ontario Combines GST and PST into HST, Good or Bad?

Jay — Thu, 07 Oct 2010 13:32:13 -0000

I noticed on your little list of items that will hae 8% tax added to it. Here are some of the items that will cost you more every month.
Cable and internet
cigarettes
gasoline
haircuts
Guess I am going to spend even less cash now on the Canadian economy.
Thanks a ton.