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16 Business Points - For Small Business Owners and Small Business Bookkeepers Lisa Patrick

When you developing your business or you are compiling your information for bookkeeping as a bookkeeper or as a small business owner, several discussions generally can occur with your accountant.  Several discussions and facts you may need to know are listed below.

1.                  GST registration compulsory after any 12 month period of $30,000 of revenue.  1-800-959-5525 government business enquiry line.

2.                  If you are using space in your home for work or business there is the opportunity for you to receive rent or just a reimbursement of what it cost.  C2 Online provides a word document for free; office in home.  C2online also provides an excel document that calculates the inputted amounts and provides a total.  The cost is $4.95 on our website

3.                  You use a cash account - treat amounts paid by cash like another bank account.  Name it “Your name” in the company books.  It is used for items paid by cash and other proceeds not actually company money but a person’s name.

4.                  You use a charge account - treat amounts paid by charge card like a bank account in the company books, use one charge card specifically for the company purchases.   The interest charges are an obvious business expense.  When company expenses and personal charges are mixed together, it is a huge exercise to determine what interest is business related.  If you require a ledger for this purpose C2online has a tool for $2.95, interest for business purchases on statement.
5.                  Construction companies are required to file a T5018.  This must be filed by the 6th month after the year end.   Do the contractors information slips based on January to December and file it by June 30.  Go to link at the government website…
t5018 contractor payments.

6.                  How to handle meals claims:
a.  shift exceeding 12 hours could include travel time = one meal a day write “shift over 12 hours” on receipt
b.  client visit: write “client name, agenda, time” on receipt
c. over night travel meals write “client name, agenda” on receipt

7.                  How to maintain a vehicle log of kilometers traveled.
State the date of use, how many kilometers, reason for travel, destination of travel.

8.                  How to deal with tools and equipment and supplies owned before the company started.  Some of these items would be start up costs and some would be fair market value.
In regards to the start up costs – when did the company start ?  At the time you incur expenses with expectations of generating income. 


When you have supplies for start up not processed through the company bank: use those receipts and use the cash account.

When tools and equipment for start up processed through the company bank: use those receipts and use cash account.

When owned and used for other relationship before business: Supplies listed at fair market value not processed through the company bank, use those estimated lists or estimate receipts and use cash account.

Tools and equipment listed at fair market value processed through the company bank: use those estimated lists or estimate receipts and use cash account.
9.  Financial reports necessary to do year end: To do a quality control always provide summary reports that show totals only for the first visit about the report.

Profit & loss, balance sheet, summary of trial balance:  Print the detailed trial balance (all accounts report) when we are completed so you have a print out of all the accounts from start to finish of year.  This detailed trial balance report (all  accounts report) is only needed once entirely for government backup.

Financial statements defined briefly:
A balance sheet: Provides an account of what the company actually owns & owes
An assets: is what the company owns.
Current assets are bank, charge cards (sometimes a negative asset), cash accounts
Capital assets(fixed) are equipment & vehicles & tools & furniture, other assets (not usually a physical touchy feely thing) incorporation costs or franchise agreements.
Liability is what the company owes.  

Equity is net value of ownership.
Profit & loss: (income stmt) is the operating accounts that show how much you made and how much it cost to make it, including depreciation (capital cost allowance) of 20% or 30%, of fixed assets.
Business packet handout - statement of professional & business activities provides accounts for persons with business.

General index of Financial information (GIFI) is for corporations.

10. Employment insurance now offering a program for self employed people.
Employment Insurance Benefits for Self-Employed People <>
11. CPP contributions are paid:
a.         when you file your taxes as a partnership or proprietorship business; by a compulsory automatic calculation on your net profit.
So when you have a tax return completed, this return will combine the cpp and tax (federal & provincial) on one bill thru your sin number

b.         when you are actually working for your corporation.  Paid by the corporation through a payroll and eventually recorded to you through a T4.
A corporation business has to remit employer payroll remittances in order for this to be paid to their social insurance number for tax or cpp.

12. Tax pre - payments (installments) through your social insurance number.  When no net income estimate available, - consider 15% of all earnings as an installment.
That paid to your social insurance number at Canada Revenue Agency will also help pre – pay your Canada Pension Plan payment.
13. Three essential bookkeeping points:

  • Match what the paper work to what you claim.
  • Balance the account that the paper work is from.
  • Consistency with what you do with what paperwork is essential to compiling the totals to the accounts.

13. Four mistakes you can make in bookkeeping:
      1. Most mistakes in bookkeeping by owner.
      2. Claiming too much business use of a shared personal and business use item
      3. Claiming a purchase of equipment or tools, as 100% instead of treating like an asset that (capital cost allowance- depreciation applies)
and vice a versa, claiming an expense as equipment, like a tire purchases are repair and maintenance
     4. Claiming a meal expense in wrong account -  meals paid with a hotel receipt when traveling for business is still meals.  Always claim the meal expense in its own named account, for instance; meals & entertainment, meals – travel, meals – staff, meals for living out.  Do not put meal expense under travel – meals must be identified as meals.  The tax accountant may need to complete an income tax & GST adjustment.  (50% may be disallowed)

14.  free forms, courses, General Index of Financial Information, and Business Guides.

15.       Government seminars for small business
Edmonton     Alberta - Events <>
GST/HST New Registrant Seminar <>  
·        Small business information seminar <>
·        Tax Information Sessions <>  
·        New Employer's Information Session <>
·        Taxable Benefit Information Seminar <>
·        SR&ED Public Information Sessions <>

16.  Office Appointment types…
If your yearend totals are ready for tax prep, your appointment scheduling type would be for taxes and yearend.
If you need the totals or adjustments in your bookkeeping totals for the year and you have some questions, you appointment would be for year end only First.
If you know you need bookkeeping adjustments made, your appointment would be for a bookkeeping meeting.


Darlene Lafond. R.P.A., C.P.C.


When are you taxable in Canada? Lisa Patrick

Residency is the determining factor.  Are you ordinarly resident meaning you have residential ties as in dwelling places,dwelling place of your spouse or dependants.

Secondary ties are personal property in Canada(such as furniture,clothing),social ties(membership in Canadian recreational organizations),a drivers license from a province in Canada, or a Canadian passport.

Revenue Canada taking too much money from you? Lisa Patrick

 Your accountant should be providing you strategies. In fact, if you don't take the time to analyze your business you could be missing out on thousands of dollars in business tax deductions and thousands more in savings.

Most accountants don't utilize the tax deduction offered from CRA for a convention for your business. Part of the problem is that you must have the paperwork to coincide with your vacation to prove that while you vacationed you worked on building success in your business.

All you need is some multiple choice agenda's that deal with the day to day operations of your business. We provide the tools necessary to deduct your vacation 100%. All you do go on your vacaction, fill out your agenda's and return them to your accountant for your deduction.

To leaarn more and to start saving money click here.

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