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Taxes Information |
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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: Tax Schedule 2023: Every Date You Need To Know Yahoo Finance Non-profit hosting annual Tax-A-Thon Saturday CBS Chicago Here's what's being negotiated in Utah's 'historic' tax cut deal Salt Lake Tribune She Lost Her Childhood Home Over Taxes. Then It Erupted in Flames. The New York Times Kathy Hochul Eyes Higher Payroll Taxes, Casino Revenue to Avoid New York City Subway Cuts - WSJ The Wall Street Journal How inflation and taxes will hit big bonuses in 2023 for autoworkers Detroit Free Press Lowering taxes to attract and retain residents discussed Nebraska Public Media | News Call Kurtis: IRS suggests Californians hold off on filing taxes over gas tax rebate question CBS Sacramento New York Keeps Piling on Taxes - WSJ The Wall Street Journal Rising property taxes leave property owners with sticker shock The Baldwin Bulletin Former Arkansas State Senator Sentenced for Bribery and Tax Fraud Department of Justice 7 Tax Benefits of Marriage GOBankingRates Student Loans and Taxes: FAQs | Student Loans and Advice | U.S. ... U.S News & World Report Money Tips to Know for Filing Your 2022 Taxes NBC 5 Dallas-Fort Worth County, school board discuss tax-related issues | News, Sports, Jobs timesobserver.com Op-Ed: Louisiana’s success hinges on reforming state income taxes The Center Square Mileage fee may replace fuel taxes for Oklahoma drivers Oklahoman.com Prembroke residents discuss taxes and new spending at budget ... Concord Monitor Workers have moved on to a hybrid future. S.F's taxes are stuck in ... San Francisco Examiner 'Taxpayers are asking for relief': Three property tax bills unveiled in ... The Spokesman Review Letter: Washington taxes not regressive The Columbian 2023 State and Local Tax Considerations EisnerAmper Pa. collected $3.6B in taxes in January, coming in under projections ... - Pennsylvania Capital-Star Pa. collected $3.6B in taxes in January, coming in under projections ... Pennsylvania Capital-Star Wyandotte County’s utility tax is double the national average. Residents aren’t happy Kansas City Star AARP Tax Aide available at library Herald-Banner Here's what you need to know about the fight over property tax cuts ... The Texas Tribune Which Ohio cities have the highest property taxes? The Wake Up for Friday, Feb. 3, 2023 cleveland.com Columbus Tax Preparer Pleads Guilty to Federal Charges for Filing ... Department of Justice BBB: Tips for filing taxes Spectrum News 3 Tax Myths That Could Really Cost You The Motley Fool Hochul wants to raise cigarette taxes, ban flavored tobacco Spectrum News NY1 3 Tax Mistakes to Avoid in 2023 The Motley Fool Philadelphia Man Pleads Guilty To Tax Fraud And Commercial ... Department of Justice Tax Benefits of Real Estate Investing For 2023 Yahoo Finance Cut Taxes, Invest in Our Kids | Office of Governor Jim Pillen Governor Pete Ricketts Larimer County property tax statements have gone out to owners Loveland Reporter-Herald How to sign up for WA’s new Working Families Tax Credit The Seattle Times Will New Mexico get more tax rebates in 2023? KRQE News 13 Mozambican mines, Taliban taxes, and Myanmar's downward spiral ... The New Humanitarian Tax Relief for Californians Impacted by Storms | California Governor Office of Governor Gavin Newsom Property Tax Relief A Possibility In Wyoming After 16% Jump Last ... Cowboy State Daily Sweet success: Seattle’s sugary drink tax is reducing health inequities The Seattle Times The Pitfalls of Flat Income Taxes – ITEP Just Taxes Blog Tax Season 2023: Tax Day, Free File, and Smaller Tax Refunds Kiplinger's Personal Finance 3 Ways to Pay Less Taxes in 2023 Kiplinger's Personal Finance Avoid Penalties! Pay your taxes by January 31, 2023 Tarrant County Trump Organization Fined $1.6 Million for Evading Taxes The New York Times How Do Full-Time RVers Get Mail or Pay Taxes? 'You Can't Just Fly ... The Wall Street Journal Wealth taxes: State lawmakers plan to introduce bills to tax the rich The Washington Post Monday marks 1st day to file taxes, as experts warn ‘refund shock’ possible for 2023 tax season KKTV |
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