A Beancounter's Blog

April 30th is fast approaching if you do not already have your taxes done (or in to an accountant) should you be worried?

April 30th is the deadline to file your return (unless you are self-employed in an unincorporated business). The penalty for filing late, is a percentage of what you owe when you file, so if you are going to get a refund there is not penalty. Of course the only way to know for sure if you are going to get a refund is to do your taxes, so what are you waiting for?

For the self-employed your returns do not have to be filed until June 15th, BUT if you owe any money on your return the CRA will start assessing you interest as of April 30th, so it would be nice to have an idea of what you owe so that you could make the payment and avoid unnecessary interest.

Not my words regarding the Trillium Benefit:

“The Ontario government increased the threshold to $360 from $240 a year which means that more people will get their yearly benefit in a single payment, delivered each July.

Recipients entitled to more than $360 in benefits for the year will continue to receive monthly payments.

Ontarians now get their money sooner and on a predictable schedule, as bills are received, rather than having to wait until they file next year’s tax return.

The Ontario Trillium Benefit is part of the Ontario government’s ongoing commitment to provide relief to Ontarians with modest incomes and supports the Poverty Reduction Strategy”

Me Again:

So yes you are getting your Ontario tax credits sooner, it just might not seem like it if they give it to you monthly instead of with your tax refund.

Happy Easter! Or as it is known in most accounting offices - Happy start of the sprint to the end of Tax Season!

It is never more true what they say about death and taxes especially on this weekend. You see regardless of when it falls on the calendar, Easter weekend seems to be the reminder for many that it is time to bring in their tax information! I am not sure what it says about us accountants if our clients think of us during a weekend famous for someone being crucified!

Or maybe it is after a long weekend spent with family that many people think, “Getting my taxes done can’t be as bad as that.”

What ever the reason, if you are bringing your stuff in next week we look forward to seeing you. And if you need to get away from your in-laws you could always make an appointment to come see us on Saturday (we’ll be here).

PS: One tip if you getting your stuff ready next week is that the income slips for any mutual funds you own (T3 slips) may not arrive in your mail box until next week.

This is just a reminder that the hiring credit that started last year has been renewed. So if you paid more Employment insurance in 2012 than you did in 2011, you will receive a credit on your source deductions.

Last year’s post has a few more details.

The only thing you have to do is be sure to reduce one of your source deduction payments (payroll taxes) by the amount of the credit, which would be included in a letter you received shortly after filing your T4s.

If you have any questions please do not be afraid to ask.

After Accounts Payable the next thing down your balance sheet might very well be HST Payable.

If you are HST registered this would be the amount of HST you collected from your customers, less the HST you paid on your purchases. For example if you collected $100 of HST from your customers but paid $20 in HST on your expenses you only have to remit $80 to the Canada Revenue Agency for that period.

How often you have to file your HST depends on your volume of sales. If your sales are under $1,500,000 a year you only have to remit annually. Between 1.5 million and 6 million the filing requirement is quarterly, and if you are 6 million + the requirement is monthly.

One of the most common mistakes I see is a client (or their bookkeeper) preparing the HST return a couple of weeks after the end of the period (say for example a period ending December 31st 2012). Then after they have sent off the HST return the client receives a bill from a supplier in late January that is originally dated December 29, 2012. In the accounting software this bill is entered on the December date. The HST included in this is then forgotten about when they prepare the next HST return. This is why it is important to do a reconciliation of the HST account with every return. For more on that please contact me.

Start-ups

When you call to register your company for HST, the CRA seems to default everyone to a monthly filer, when you would likely rather be an annual filer (less paper work is usually better). So be sure to specify that you want to be an annual filer, and make sure you have discussed with your accountant when your year end will be, since the CRA will ask you that too.

If you get registered as a monthly filer the only only way to switch to an annual filer is to file monthly HST returns until you are caught up and then switch, with can be a real pain!

Finally you must register once your taxable sales exceed $30,000 in any given year, but you may want to register early if you are going to spend a lot of money to get your business up and running. The reason is that HST is a net tax, so if you collect $0 (because you have no sales in the first year) but spend $260 in HST (on a $2,000 computer) the CRA will send you a cheque for $260! So register before you are going to make any major business purchases!

Since most employers are about to make their first payroll run of the year, I thought I should remind (or inform if you did not already know) about a small change starting in 2013.

Starting January 1, 2013 Critical Illness insurance and Accidental Death & dismemberment insurance are now taxable benefits. This means they need to be shown on the paystubs for your employees and more importantly that you need to deduct income tax off of their paycheques for this amount.

So you might want to warn your employees that their paycheque will be a little lighter this week. Although the one client I helped the taxable benefit was $8 per pay so the change in tax was only be a couple of bucks.

When you file your 2013 T4s (a year from now) these amounts will be added to box 40. And the taxable benefit amount should include provincial insurance tax if applicable (Ontario’s is 8%), but most insurance companies should be able to provide you with the actual numbers.

Yup that is right more taxes, consider this your Happy New Year’s gift from our friends at the CRA!

About a year ago, I took the plunge and joined a group called BNI!

This is a networking group of business professionals. Our group is about 27 members, all of which are executives in Business to Business industries. The group only allows one member per industry, one lawyer, one commercial insurance guy and one accountant (which is usually one too many).

We meet from 7:45am until 9:30am. Start with some informal chit-chat, followed by everyone’s 45 second infomercial. Then one of the group members gives a more detailed 10 minute presentation (so you get to go 1 to 2 times a year). The final part of our meetings is the contribution part. Every member is expected to come with one of the following each week:

1. A referral for another member of the group
2. A guest to the meeting
3. A BBI (Business building interview) where you met with another member to learn more about their business.

So there are 27 professionals out and about keeping their eyes and ears open for potential business for me and the rest of the group!

As if that was not cool enough, these people are actually fun! This is one of the things in my calendar I look forward to each and every week!

So has this been worth it? HELL YEAH!

Over the last year this group has referred me over $33,000 worth of new business! That works out to roughly $425 per hour, while I am having fun.

So the only question I have left is… .

When are you coming as a guest?