Frequently Asked Questions
Welcome to our Frequently Asked Questions (FAQ) page! Here, we’ve compiled a comprehensive list of common queries and their concise answers to provide you with quick and easy solutions to your most pressing questions. Whether you’re seeking information about our products, services, policies, or anything related to our organization, you’ll likely find the answers you need here. If you need help finding what you’re looking for, don’t hesitate to contact us for further assistance. Explore our FAQ section to streamline your experience and get the information you need hassle-free.
Frequently Asked Questions
Anytime your annual sales reach $30,000 then you are obligated to register for HST. But it is advisable to register for HST even if your annual sales are lower than $30,000 since when you are registered, you will be able to recover the HST you pay on your business expenses. Not all businesses need to register for HST even if their annual sales are over $30,000. Examples of that include medical practitioners and mortgage agents since these two services do not attract HST on their fees.
Your accountant is the right place to start your journey into a stronger financial literacy. If your accountant dismisses your questions and thirst for knowledge by saying “don’t worry about this, I will take care of it” without answering your queries, then for sure change accountants. A good accountant’s first job is to educate you on the most important financial and tax matters in a very non-judgmental way. An excellent accountant will explain things in a simple memorable way leaving you hungry for further questions and more insight.
If you are speaking and/or meeting with your accountant once a year, it is time to change them. A good accountant is not purely a tax preparer. A knowledgeable accountant works with you throughout the year to optimize your finances from taxes, to investments, to mortgages and other financial issues. Interactions have to be fluid and frequent. Sure that will cost you more fees but it will save you lots of money and agony in return. Call your accountant now.
Registered Retirement Savings Plans (RRSP’s) are one of the biggest tax breaks in Canada. Investing in RRSP’s shelters income from tax in the year of the deduction. It also allows you to grow the income in the RRSP’s (interest, dividends, capital gains) tax-free for decades. Withdrawing RRSP in your retirement years will provide you with a pension income which will be taxed at a lower rate since your effective tax rate in your retirement years will most likely be lower than your tax rate in your producing years.
While it is always advisable to incorporate to protect your personal assets from being included in a potential lawsuit against your business, from a tax perspective, it is beneficial to incorporate your business if income from business exceeds your personal annual spending requirements. The excess income can be sheltered in the corporation from the higher personal tax rates. The cash can be invested in a myriad of ways allowing a higher base of capital to be reinvested.