We are a firm specializing in taxation for both corporations, individuals and trusts. Whether you are the shareholder of an incorporated business or are an individual behind with multiple years of back taxes we are here to help.
Yearly financial statements are requirement for all corporations in order to file the GIFI section of the T2 Corporate Income Tax Return. Proper financial statements are not technically required for sole proprietorships however they are an often overlooked business tool. The balance sheet is a snap shot of what the company owns (assets) versus what the company (owes) at its year-end date. The income statement is a time based report showing the profit or loss for a particular period in time. The detailed information contained in your financial statements are an important tool for management, lenders and potential purchasers of the business. We prepare financial statements for tax & management purposes only (Notice to Reader).
Corporate Income Tax
As corporations are a separate legal entity they are also by virtue a separate entity for tax purposes as well. The T2 Corporate Income return is much for complex than the T1 Personal Income Tax Return. Special consideration must be made by your accountant to determine whether or not to treat the owner draws from the company as a salary (T4) or dividend (T5). In some situations a mix of salary and dividends is most advantageous. Some of the income tax benefits of operating as a limited company include the small business deduction for corporations involved in active business and tax free disposal of qualifying small business shares on capital gains up to $750,000.00.
Personal Income Tax
Every individual who is a resident of Canada and who has taxable income must file an income tax return with the Canada Revenue Agency on an annual basis. While there are many relatively simple and straight forward tax situations it has been shown time and again that hiring a professional to file your return pays for itself in the long run. Quite simply, people who are not trained in the intricacies of Canadian income tax will not take full advantage of all the deductions and credits to which they are entitled. The more complicated situations will always require the knowledge and ability of a highly trained professional.
Trust & Estate Taxation
A trust is a form of legal entity in which one administers property (trustee) for the benefit of another (beneficiary). The most common form of trust is created on death and is commonly referred to as a testamentary trust. Property can be transferred to a trust before death however special care and consideration must be made to avoid any adverse income tax consequences. This type of trust is common referred to as an inter-vivos trust. The T3 Trust Return reports the income in the trust for the particular reporting period. As trusts are relatively obscure and complex legal arrangements the expertise of a highly trained professional is always recommended.
The building blocks of financial accounting. In it's purist sense it is a series of debits and credits reported in various general ledger accounts. A proper double entry bookkeeping system is essential for all businesses who require annual financial statements. The benefits of having a proper bookkeeping system are in the accuracy of the financial reporting. A sole proprietorship does not technically require a double entry bookkeeping system but may choose to employ one for internal control purposes. For example, a proper bookkeeping system reconciles the banking records to the accounting records to avoid double entries, missing entries and transpositions.
The GST return is a calculation in the difference as to how much GST has been collected versus paid out in a particular reporting period. All businesses with taxable sales in excess of $30,000.00 a year must register and charge GST. Businesses with taxable sales under $30,000.00 may elect to register for GST as a small supplier. GST is generally charged on all products and services however due to the complexity and nature of the excise tax act there are many exceptions to this rule. For example, certain goods and services are exempt from GST while other are defined as zero rated. This is an important distinction because of how input tax credits are claimed.