Successful entrepreneurs are often on the hunt to acquire other businesses for strategic reasons. Acquiring a competitor to increase market share or buying out a supplier to add synergy to an existing business are just a few of the reason entrepreneurs seek acquisitions. When a business is up for sale negotiation, the seller of the business has a huge advantage over the buyer. The seller, being the current operator of the business, has intimate knowledge of the environment he operates ... Read More
With the curve flattening in BC, I am going to practice optimism and leap back to the future to discuss tax planning for BC individuals and small businesses for the 2020 year end.
Operating loss utilizationThere will be businesses with operating losses for this fiscal year. Losses can be carried back three years whether you are proprietor or an incorporated business. Note that many of the financial assistance received under the Canada Emergency Response Plan for ... Read More
Vancouver enjoyed excellent weather during the 2019 summer months without smoke to block the sunrays.
CRA Audits Vancouver BusinessesWhile the taxpayers were busy vacationing, the CRA was very busy sending out tax review letters to many businesses. Based on my own experience and conversations with colleagues, a massive fishing expedition was underway this spring and summer. Many businesses are being reviewed for auto expenses, payroll remittances, GST ITC claimed, ... Read More
In a recent blog, I explained why a CCPC shareholder is better off holding real estate investment or any passive investment in a CCPC versus personally. Those who are familiar with recent changes to CCPC tax laws will note that there is a $ 50,000 investment income ceiling, after which for every $ 1 additional investment income dollar will claw back the SBD by $ 5. Hence, once investment income reaches $ 150,000, the entire SBD will be eliminated. In other words, there is no income that ... Read More
More small businesses are now on cloud account software. Many business owners are performing the bookkeeping functions on their own and just as many business owners hire a bookkeeping firm who specializes in cloud software to do the bookkeeping. Now, AI is getting involved to limit human coding errors that still exist with cloud software. As for me, the external accountant, I have noticed considerable improvement with both, the software and the users maximizing the software full ... Read More
Many mature businesses have endured this at least once during their life time – a CRA tax audit. Most businesses survive an audit with no issue. This happens when the business has an adequate set of financial records that is easy for the CRA auditor to examine. So what makes up an adequate set of financial records. First of all, the CRA audit has changed from twenty years ago. In the past, an actual person came to the business premise to examine the books and records. Hence if the ... Read More
As 2018 comes to an end, tax advisors across Canada are busy restructuring and planning many corporations to respond to the new tax rules that came into existence this year.
BC's New Tax Law Called Tax on Split Income (TOSI)The biggest new tax law introduced this year is Tax on Split Income or TOSI for short. TOSI is so complicated that many tax advisors use a flowchart to visually follow the rules to assist in determining where the taxpayer stands with this rule this year. As ... Read More
2017 has been a year of drama for Vancouver tax advisors and I am happy that it is coming to an end. I have to admit, it is not so much January 1, 2018 I am looking forward to. I am anxiously waiting for the 2018 budget date which may bring all Canadian private corporations more clarity on their financial and tax future. Vancouver Tax Planning - Changes For Private Coporations On July 18, 2017, Ottawa proposed dramatic changes to the taxation of private corporations. Since then, Ottawa has ... Read More
While at dinner recently, a friend of mine, Carla, informed me that she sold her rental property and was curious about the amount of tax that she would owe on the gain. Upon further questioning, I uncovered that, in the past, my friend had lived in this rental property (a condo) for many years. She purchased a second condo a few years back and moved into it. She had then rented out the first condo—the one she just sold. From her line of questioning, I realized that, other than the tax ... Read More
As we reach the mid-point of the 2017 calendar year, it has been a good financial year for many British Columbian investors. Real estate gains continue and, for equity investors, the stock market has been on a tear since the fall of 2016. Vancouver Corporate Tax Planning With the conclusion of the personal tax-filing season, summer and fall is the time for corporate tax planning. The one tax planning item that should be looked at this year, due to such favorable macro-financial conditions, is ... Read More