A Spotlight about Tax Shark

The first one is that, at the same time as working as an employee, you can make the same income. If you don’t think that you can consistently generate income, having a business may not be worth it. The truth is that the revenue of companies tends to be lumpy and unpredictable. The second one consists of deductions. Tax Shark┬áhas some nice tips on this. Fewer deductions and less EI would be paid by small businesses, but more would be paid in CPP. If you choose to have it as a business versus being an employee, insurance may cost more as well, since the employer subsidises the cost of insurance. The presumption that you are running a business at home is within this point. Your expenses for your home would be partially deductible, resulting in less tax being paid. If you run your business from another location, you will incur more expenses and, depending on the net impact of your revenue and expenses, the tax situation may be better or worse. The third point of clarification is that, between being a contractor and a small business, there are different tax rules. Finally, the type of business is significant. It is fairly simple to be a sole proprietor, but different costs and commitments are included in the integration. Yes, generally speaking, the corporate tax rate is lower than for individuals. However, corporations take more time to operate, have setup costs, legal costs and reporting costs that sole proprietors don’t have. Corporations would also have separate HST numbers, another layer of record keeping above and beyond that of a sole proprietor. Keep in mind that more time and effort are also involved in complexity in general. It’s a completely different matter to incorporate for legal or strategic reasons. Prior to considering the formation of a corporation, professionals should be consulted.