Let us create a 3D eBook for you!
Let us create a 3d Digital eBook for you! DigyCat.com

Rearrange Your Affairs For Maximum Tax Savings


One way to maximize your business profits is by reducing your taxes.Frequently, income and other taxes could be lowered significantly if only the taxpayer were willing to plan ahead. By taking some simple steps to rearrange your affairs, you could save a fortune!

1. Are You Splitting Your Business Income?

You may pay reasonable salaries to spouse or children through your incorporated or unincorporated business. If you are not doing so, you may be missing out on some real tax savings.

In the Canadian Federal Budget of February 16, 1999, measures were introduced to discourage income splitting with minor children through family trusts. However, these measures do not apply to paying reasonable wages to family members. Thus, this may be one of the last ways of legally splitting income left for the small business person with minor children.

Obviously, the amounts paid must bear some relationship to the work performed. Of course, all required payroll taxes should be remitted and proper records need to be maintained.

Why not rearrange your affairs so that family members with little or no income can perform duties for and be paid by your business? Then, they can contribute out of their own income towards the operation of the household. In this way, little or no tax will be paid by your dependants and you will have successfully shifted taxable income out of your hands.

2. Should You Register For The Goods And Services Tax?

Even if your business grosses less than $30,000.00 per year in taxablesales, you may still benefit by registering your business to collect the Goods and Services Tax (G.S.T.). If you are not doing so, you may be missing out on some real tax savings.

For example, you will be paying G.S.T. on many of your business expenses. If not registered for G.S.T., you must absorb this cost. If registered, you may deduct the G.S.T. paid on such business expenses (input tax credits) from the tax collected. Many business persons expect to pay G.S.T. and it doesn`t really cost them anything since they deduct such amounts as input tax credits from the G.S.T. they collect from their customers.

In some cases, the quick method of calculating G.S.T. may actually allow you to retain more of the G.S.T. collected than you would have just claiming the G.S.T. actually paid by you.

A factor to consider also: If you are not registered for G.S.T. in Canada, you are telling your clients that you do under $30,000.00 per year in taxable sales or that you cheat. Is this the image you want your clients to have?

3. Could You Benefit From Incorporating Your Business?

Although incorporating your business may result in increased accounting and legal fees (for setup, extra tax returns, and annual minutes), the advantages of incorporation may justify this added expense. Not only will you enjoy limited liability by incorporating, but you may reap significant tax savings as well.

Corporations are often subject to lower tax rates on small business income. In Canada, sales of shares of qualifying small business corporations can obtain a lifetime $500,000.00 capital gains exemption. Certain tax incentives and government programs are only available to incorporated entities. Additionally, corporations can be used for income-splitting and estate, retirement, and succession planning objectives.

4. Do You Engage in Tax Planning Year-Round?

Some people only worry about their taxes during tax season. However,you will save a fortune in taxes, legally, if you make tax planning your year-round concern.

Can you make some changes to turn your hobby into a moneymaking business? Can you use that extra room in your house as a home office for your business? Can you arrange to use your car more for business purposes and have you documented your business use mileage? Can you arrange for more of your entertainment expenses to be business related and have you listed the business purpose on the back of each receipt?

Do you make business and personal purchases, investments, and other expenditures with tax savings in mind. Do you document your expenses well so that you they would survive a tax audit? Whenever you are faced with a business or personal financial decision, do you consider the tax consequences?

Make year-round tax planning part of your business management mindset and, thus, enjoy maximum tax savings. Yes, by rearranging your affairs to account for tax implications, you will save a fortune in taxes.

RESOURCE BOX

J. Stephen Pope, President of Pope Consulting Inc.,http://www.popeconsultinginc.com/ has been helping clients to earn maximum business profits for over twenty-five years.

For valuable Work at Home Small Business Ideas, visit:http://www.yenommarketinginc.com/


MORE RESOURCES:

Taxes - Google News

This RSS feed URL is deprecated

This RSS feed URL is deprecated, please update. New URLs can be found in the footers at https://news.google.com/news

10 Ways to Legally Reduce Your 2018 Taxes - Motley Fool


10 Ways to Legally Reduce Your 2018 Taxes
Motley Fool
Homeowners are privy to a number of tax benefits, the most lucrative of which is typically the mortgage interest deduction. Now you could just make your standard 12 monthly mortgage payments in 2018 and call it a day, but if you want to eke out some ...

and more »

Indian government likely to reject Apple's request to delay new import taxes - 9to5Mac


9to5Mac

Indian government likely to reject Apple's request to delay new import taxes
9to5Mac
Wistron assembles iPhone SE models in India for Apple, but the components are all imported. Under a current agreement, most of these components can be brought into the country tax-free, but the government wants to impose import tariffs on more of them ...
Apple, India wrangle over import tax on mobile parts: sources Reuters

all 8 news articles »

Small Investors Face Steeper Tax Bill Under Senate Proposal - Wall Street Journal


Wall Street Journal

Small Investors Face Steeper Tax Bill Under Senate Proposal
Wall Street Journal
A little-discussed provision in the Senate tax bill could lead to a higher tax bill for millions of small investors and cause many to unload stocks before year-end to avoid those costs. Under the Senate's $1.4 trillion tax overhaul, investors would ...

and more »

Most Americans Expect a Tax Refund in 2018 - And That's Not a Good Thing - Yahoo Finance


Yahoo Finance

Most Americans Expect a Tax Refund in 2018 - And That's Not a Good Thing
Yahoo Finance
If there's one thing pretty much all Americans can agree on, it's that taxes are a major burden. Not only does losing a portion of our income constitute a harsh blow, but the process of filing taxes can be downright stressful. But filing hassles aside ...

In Trump's America, Even White People Can Face Poll Taxes, if They Lean Liberal - Daily Beast


Daily Beast

In Trump's America, Even White People Can Face Poll Taxes, if They Lean Liberal
Daily Beast
The Granite State's Republican-controlled state legislature has responded to narrow defeats — we're talking less than a percentage point — to Democrats in the 2016 election by proposing a poll tax that targets college students: a vital Democrat ...

and more »

Precision sacrificed for speed as GOP rushes ahead on taxes - Chicago Tribune


Chicago Tribune

Precision sacrificed for speed as GOP rushes ahead on taxes
Chicago Tribune
The specific legislation that probably will become law, sold as a middle-class tax cut but featuring a massive corporate rate reduction at its center, is moving from release toward passage without any hearings, unusual for a bill of such magnitude. And ...
Susan Collins Says She's Not a Definitive 'Yes' on Taxes New York Magazine
Today in Taxes: Busy Behind the Scenes Wall Street Journal
Republican tax bill would tie the hands of blue-state governments Washington Examiner
Bloomberg  - New York Times  - AZCentral.com
all 257 news articles »

8.8 million Americans face big tax hike if Republicans scrap the medical deduction - Minneapolis Star Tribune


Minneapolis Star Tribune

8.8 million Americans face big tax hike if Republicans scrap the medical deduction
Minneapolis Star Tribune
Anne Hammer is one of millions of elderly Americans who could face a substantial tax hike in 2018 depending on the final negotiations over the Republican tax bill. In her retirement community in Chestertown, Md., it's the big topic of conversation ...
As California burns, Congress plans to slash tax write-offs for fires and other disasters Los Angeles Times

all 29 news articles »

Scoop: Trump's closing argument on taxes - Axios


Axios

Scoop: Trump's closing argument on taxes
Axios
Scoop: Trump's closing argument on taxes. Photo: Alex Brandon / AP. On Wednesday, President Trump will deliver his closing argument on tax reform to an audience made up largely of young people and middle-class families whose personal stories will be ...

and more »

Taxes and the Safety Net - New York Times


New York Times

Taxes and the Safety Net
New York Times
Make no mistake: The tax cuts for corporations and wealthy people that Congress is determined to pass will lead to major cuts to health and economic security for the rest of us. The Congressional Budget Office anticipates that Medicare alone will be ...

and more »

LargeFriends.com - the best dating site for plus-sized singles!
SuccessfulMatchCentral.com - the best dating site for plus-sized singles!

PreLaunchX

PrimeNews Domain Is For Sale - $5,000 For Enquiries eMail Us

© www.PrimeNews.biz - 2012

home | site map | links