Category Archives: Small Business

Links to key 2021 Federal Budget coverage

Nevcon Accounting is pleased to provide the following links to articles, analyses and more, to help you learn more about the 2021 Federal Budget, delivered April 19, 2021.

GST / HST registration webinars coming April 28, 2021

The Canada Revenue Agency is hosting a free webinar to help businesses determine when and how to register for a GST/HST account. Topics to be discussed in the webinar include:

  • what GST/HST is
  • provincial and territorial GST/HST rates
  • who needs to have a GST/HST account and how to get one
  • taxable supplies
  • GST/HST obligations
  • GST/HST returns, filing deadlines, and payments due dates

This webinar is for you if you’re a:

  • business owner
  • self-employed individual

The webinar is on Wednesday, April 28, 2021, at the following times:

In English

Newfoundland and Labrador
2:30pm
Maritimes
2pm
Quebec, Ontario, Nunavut
1pm
Manitoba, Saskatchewan
12pm
Alberta, Northwest Territories
11am
British Columbia, Yukon
10am

Register now

In French

Newfoundland and Labrador
11:30am
Maritimes
11am
Quebec, Ontario, Nunavut
10am
Manitoba, Saskatchewan
9am
Alberta, Northwest Territories
8am
British Columbia, Yukon
7am

Register now

You’re also invited to submit your questions about GST/HST registration before the webinar takes place. To do so, please visit the registration website on Tuesday, April 20, 2021, between 6:00 am EST and 8:00 pm EDT. We’ll answer as many questions as we can during the webinar.

New product offering – Audit Shield offers peace of mind

Suffice to say, the past year has brought many changes and challenges. One result is that the CRA has stepped up their enforcement efforts with more audits. If you and your business are subject to an audit, this can involve significant cost to you because of the added fees to for Nevcon to respond to such requests.

Audit ShieldWith this in mind, I choose to offer Audit Shield as additional add-on protection for these costs. It might seem like a significant cost when you first look at the pricing, but once you factor in the amount it would cost you for an audit, I hope you’ll see that it’s good and proactive. Audit shield covers up to $10,000 (Cdn) in fees to help you respond to an audit request by CRA.

If you are a current Nevcon Accounting client, you will have received or will soon receive an email message with more details on how you can take advantage of this new offering. The message will spell out more of what they do and do not cover. For small businesses and sole proprietors, it’s a smart business decision.

If you are considering becoming a Nevcon Accounting client and would like to learn more about Audit Shield as part of what we can provide, contact us for more information.

Keeping you up-to-date on small business news in response to the pandemic

As we’re sure you may have already heard, Prime Minister Justin Trudeau made some announcements this morning (March 27, 2020) about additional programs available to support small businesses. What these programs will have to offer could possibly be substantial to you, so we understand completely that you would like to know what this means to you. Unfortunately, the government has not yet released a lot of details, so we’re not able to answer with any accuracy whether you qualify, or whether it will benefit you.

Please bear with us and all of our accounting and bookkeeping colleagues (who are working together and sharing insights) as more information comes out over the next several days. We promise that as we learn more information about what will impact your business, you will be the first to know.

Here is what we do know so far:

  • Temporary Wage Subsidy – Originally introduced at 10% retroactive to March 18th, this new announcement brings the Temporary Wage Subsidy up to 75% retroactive to March 15th. There are no details yet on qualification, caps, or time period.
  • Small Business Loans – Up to $40K, government backed, interest free for one year, up to $10K could be forgiven – is what we know at this point. No additional details have been given as yet.
  • GST/HST Payments – These payments will be eferred until June 1st. Filings are still due, only payments are deferred.
  • Taxes/Duties on Imports – Payments are deferred until June 1st.
  • Bank of Canada has also cut the interest rate – down to 0.25%.

Thank you for your patience as we work to get more information. Wishing you and yours safety and good health as we all make our way through these unprecedented times.

Employment Insurance (EI) and COVID-19

This information is developing and changing as the COVID-19 situation unfolds. We’ll do our best to update the details as they change.

Laid off due to work closures?

  • Apply for regular EI benefits
  • You will need 700 work hours in last year
  • You will need a ROE saying you’ve been laid off from your employer to get benefits
  • There is a 1-week wait period (so you will not be paid for 1 week)
  • Apply online: https://canada.ca/en/services/benefits/ei.html
  • Call 1-800-206-7218 for more info

Unable to work due to self-quarantine?

  • Apply for EI Sickness benefits
  • You will need 600 work hours in last year
  • You do not need a ROE or sick note to qualify
  • The 1-week wait period has been waived
  • Apply online: https://canada.ca/en/services/benefits/ei.html
  • Call 1-833-381-2725 for more info

Laid off and ineligible for EI?

  • Apply for the Emergency Support Benefit
  • Amounts and eligibility has not yet been announced
  • Applications will be available in April via CRA MyAccount, My Service Canada Account, and a yet to be released toll-free number

Self-quarantined and ineligible for EI?

  • Apply for the Emergency Care Benefit for workers not eligible for EI (including self-employed) who are sick with COVID-19, quarantined, or taking care of a family member with COVID-19
  • Up to 15 weeks of benefits, up to $900 bi-weekly
  • Applications will be available in April via CRA MyAccount, My Service Canada Account, and a yet to be released toll-free number

Unable to work due to school closures?

  • Parents with children who require care due to school closures can apply for the Emergency Care Benefit
  • 15 weeks of benefits, up to $900 bi-weekly
  • Applications will be available in April via CRA MyAccount, My Service Canada Account, and a yet to be released toll-free number

Do I qualify for WorkSafe benefits?

  • WorkSafe benefits are not available for preventative measures or non-work-related exposure
  • Only file a claim for COVID-19 virus infection contracted through work-related exposure,/li>
  • Call 1-888-967-5377 for more info/li>

Tax changes coming into effect in 2019

We’ve barely taken down the holiday decorations … and it’s time to start thinking about tax changes that kick in as the new year gets under way. But if you stay on top of them now (and hey, you know who to call if you need assistance!), there will be more reasons to celebrate as the new year unfolds.

This overview from CBC News is very helpful:

obj-tax-image-iStock-480459733
(Image courtesy of Ottawa Business Journal)

Your tax bill could change in 2019. Here’s what to expect.

From low-income subsidies to passive cash taxation to the carbon tax, the rules are set to shift

A whole host of federal tax changes come into effect in the new year. Some will hit your paycheque, others your bills — and if you’re a small business owner, there are a couple of changes coming for which you’ve likely been preparing for months.

Read the entire article here.

For taking charge of receipts when you’re on the go …

receipt-bank-logo

Have we mentioned how much we love Receiptbank? We recommend it to all our clients, and we’re enthusiatic users of the app ourselves. As Receiptbank points out, its mobile app is ideal for:

  • Taxi receipts
  • Train tickets
  • Restaurant/cafe receipts
  • Anything you get out-and-about!

Take a look at this quick and easy video to get up and running!

Psst … Did you know you can use Receiptbank for invoices you receive by email, too?

How to best claim your auto expenses

The following article from the Nevcon Accounting resources archives is still rather handy and relevant today:

Canadians love their automobiles and are ecstatic when they can figure out a way of claiming them as a deduction on their income tax returns. The authors of the Canadian Income Tax Act and the auditors employed by the Canada Customs and Revenue Agency (now Canada Revenue Agency) who enforce its provisions are not quite so enthusiastic. The rules relating to what a car owner can claim or how an employee or shareholder is taxed in terms of a vehicle that is provided to him have become so complex over the years that at times it seems that cars and income taxes do not mix.

For the driver, we have “standby charges” based upon the number of days that a vehicle is made available for use, with different rules relating to whether the cars are owned or leased by the employer. As far as the company providing the vehicle is concerned, we have limitations relating to the deduction of capital cost allowance (depreciation) based on the cost of the car and restrictions as to the deductibility of interest on funds borrowed to acquire it. We have rules relating to operating cost and others relating to parking as well as still others that assure that GST is being collected correctly.

Finally, the self-employed are required to keep track of the total number of kilometres driven in a year and allocate that figure between business and personal usage.

The fact of the matter is that over the years the income tax rules have become such a burden that many are looking for ways to reduce the extensive record keeping that is now demanded.

The way to alleviate this problem and put some sanity back into the calculation of an appropriate automobile expense for all involved is provided below. It is possible that in your particular situation, the traditional methods of calculating automobile expenses may produce greater savings. However, in the long run, if you follow what is suggested here, the few dollars in income tax savings that you lose will be more than made up by the amount of aggravation you will have eliminated.

Option #1 – No more company cars

Employers should get out of the car ownership business and pay those employees who require a vehicle to perform their duties a flat rate allowance for automobile expenses. The payment is an allowable deduction for the employer, but is taxable to the employee. The allowance must be generous enough to cover actual costs incurred and the associated income tax liability that will result.

Option #2 – Reimbursement of cost

Employers pay their employees who require a vehicle to perform their duties a flat rate per kilometre of business travel. The payment is deductible to the payor and is not included as income to the recipient as the amount received is considered to be a reimbursement of costs incurred. The rate to be paid can be based upon that paid by the government in similar situations.

In both cases, driving to and from work will not be considered business driving. This is in conformity with CRA guidelines. However, if one drives from home to see a customer or client and then goes to the office, or alternatively, goes to see the customer or client on his way home from the office, the distance covered will count as business driving.

Article ©2001 The Quarterly Dividend
Reprinted with permission

Links to key 2017 Federal Budget coverage

Nevcon Accounting is pleased to provide the following links to articles, analyses and more, to help you learn more about the 2017 Federal Budget, delivered March 22, 2017.

The importance of business interruption insurance

“Your ability to generate sales could be threatened at any moment. With business interruption coverage, a business owner can collect the income he or she would have expected to generate were it not for the unexpected event.”
– Insurance Bureau of Canada

The following article from the Nevcon Accounting resources archives is still useful and relevant today:

All owners of small businesses naturally hope that their company will never be faced with a sudden and unexpected interruption. However, like automobile and home insurance, business interruption insurance should be purchased just in case the unthinkable happens. Failure to do so could leave both your and your employees at risk.

The problems following a loss of property, equipment or inventory are frightening. Proper business interruption insurance can ensure the survival of the business both during and after the rebuilding process. The accompanying chart addresses the options involved in this type of insurance, which is usually included in business insurance packages.

Option Applicable
businesses
Description
Rental Insurance Real Estate Indemnifies for lost rent and other income derived from tenants. Standard insurance covers a period of twelve months or the time required to restore the property, whichever is less. More comprehensive coverage can be purchased allowing the insured reimbursement until rental income returns to pre-loss levels, thus compensating the owner until all repairs to the property have been completed.
Gross Profits Insurance All Covers a business up to net income before taxes and continuing expenses. If gross profits are under-insured, the insurance company may adjust the claim in event of a loss. If a business has insurable gross profits of $1 million but carries coverage for only $500,000, should it suffer a loss of $250,000, the insurer may only reimburse the owner to the same percentage that should have been insured – n this case, 50% or $125,000. This type of insurance can be purchased for periods extending beyond the standard twelve-month policy to allow the insured to be indemnified until such time as gross profits return to pre-claim levels.
Gross Earnings Insurance All Similar to gross profits insurance above, but can only be purchased for maximum of one year. Consequently, the indemnity period may run out before allowing the purchaser to cover the predetermined percentage of gross profits he/she wishes to insure.
Increase Valuation Insurance All This insurance is not provided by many carriers. If obtainable, it provides an alternative to gross profits/earnings insurance described above in that it predetermines coverage of inventory on a cost plus basis. This type of insurance is suitable for importers and distributors who do not hold stock beyond one inventory turnover period. Manufacturers or companies dependent on their physical premises to conduct business will not find this option attractive.
Extra Expense Insurance All Allows company to resume regular operations more quickly by providing funds for such items as temporary rent at an outside location, additional labour cost, etc. This type of insurance does not provide sufficient coverage on its own and is usually offered only in conjunction with other coverages outlined above.
Professional Fees Insurance All Pays for professional assistance to prepare proof of loss should a claim be required. This type of insurance can only be purchased in conjunction with other forms of coverages outlined above.

Article ©1998 The Quarterly Dividend
Reprinted with permission