Just putting these here so I don't forget.
My Business Account service
http://www.cra-arc.gc.ca/eservices/tax/business/myaccount/menu-e.html
Canada Revenue Agency Phone Numbers
http://www.cra-arc.gc.ca/contact/phone-e.html
About.Com page with lots of links
http://sbinfocanada.about.com/od/taxinfo/Tax_Information.htm
RRSP Article
http://sbinfocanada.about.com/cs/taxinfo/a/rrsp.htm
Tax Deductions You Don't Want To Miss
http://sbinfocanada.about.com/od/homebusinesstax/a/hbbdeductions.htm
Wednesday, October 31, 2007
Tuesday, October 30, 2007
Vehicle Lease for Small Businesses
We're realizing that it might make more sense to get a second vehicle now that my consulting gig is going to take me to various places in the city throughout the year. I began looking into what the benefits were for having a lease and what can be written off.
If you're going to be using a vehicle partially for work and partially for personal use, then you can only claim use for work purposes. However, at this site (http://www.cra-arc.gc.ca/tax/individuals/topics/income-tax/return/completing/deductions/lines206-236/229/motor/menu-e.html) I found an interesting statement:
"Employment use of a motor vehicle
If you use a motor vehicle for both employment and personal use, you can deduct only the percentage of expenses related to earning income. To support the amount you can deduct, keep a record of both the total kilometres you drove and the kilometres you drove to earn employment income. We consider driving back and forth between home and work as personal use." (emphasis mine)
So...let me get this straight: you can use a vehicle you use to "earn employment income", but driving between home and work doesn't fall into that category?! So if you're a consultant, and you're assigned to be on-site to a client, that is technically driving to home and work...isn't it?
I'll need to look at this a little more closely...
D
If you're going to be using a vehicle partially for work and partially for personal use, then you can only claim use for work purposes. However, at this site (http://www.cra-arc.gc.ca/tax/individuals/topics/income-tax/return/completing/deductions/lines206-236/229/motor/menu-e.html) I found an interesting statement:
"Employment use of a motor vehicle
If you use a motor vehicle for both employment and personal use, you can deduct only the percentage of expenses related to earning income. To support the amount you can deduct, keep a record of both the total kilometres you drove and the kilometres you drove to earn employment income. We consider driving back and forth between home and work as personal use." (emphasis mine)
So...let me get this straight: you can use a vehicle you use to "earn employment income", but driving between home and work doesn't fall into that category?! So if you're a consultant, and you're assigned to be on-site to a client, that is technically driving to home and work...isn't it?
I'll need to look at this a little more closely...
D
Monday, October 22, 2007
The Importance of Treating Customers Well...and Small Business Liability Insurance
I learned recently that there are some insurance providers (like Wawaneesa) that have products designed for the small business owner. Unfortunately it sounds like there's not alot in the base plan that would cover error and ommission insurance, but the referred broker I spoke with didn't expand on what options were available, nor was he someone that I decided I wanted to provide my business to.
In any service based industry, there's one common outlook that we as service providers must remember: our customer more than likely has no idea how to do what we do, and therefore our job is to help educate them as well as provide them with our services.
Answering questions like "What options are available with the policy?" with "Well, whatever you want" doesn't really help me.
I also asked this broker what was covered under liability. "Let's say you walk into my place...and you screw up...you're covered."
Hmm...ok, so as a software developer if I walk in and there's a dispute about what was supposed to be included in the software, is that covered? "No...I'm not on the hook for that."
Well, then obviously using the term "...and you screw up..." isn't quite clear enough is it?
I'm not going to mention the brokers name here, but let's take this as a lesson: educate the people who are coming to you for help, and don't assume that they understand the service or products you provide...they just know that you're someone that has the knowledge and can help them.
D
In any service based industry, there's one common outlook that we as service providers must remember: our customer more than likely has no idea how to do what we do, and therefore our job is to help educate them as well as provide them with our services.
Answering questions like "What options are available with the policy?" with "Well, whatever you want" doesn't really help me.
I also asked this broker what was covered under liability. "Let's say you walk into my place...and you screw up...you're covered."
Hmm...ok, so as a software developer if I walk in and there's a dispute about what was supposed to be included in the software, is that covered? "No...I'm not on the hook for that."
Well, then obviously using the term "...and you screw up..." isn't quite clear enough is it?
I'm not going to mention the brokers name here, but let's take this as a lesson: educate the people who are coming to you for help, and don't assume that they understand the service or products you provide...they just know that you're someone that has the knowledge and can help them.
D
Wednesday, August 15, 2007
GST: When do you have to start charging?
I touched base with my accountant and asked him about what the rules were around charging GST as a contractor. The rules (according to the Canadian governments website) state that you only have to pay GST if you make $30K in one calendar quarter, or over 4 consecutive quarters. But I've heard some differing info from people about GST, and that you have to pay back the GST for that initial $30K once you hit that number.
So anyway, the government phone number for info kept giving me a busy signal, so I turned to my accountant for info. He said that basically once you hit 30k you have to register for GST and start charging.
Simple enough!
D
So anyway, the government phone number for info kept giving me a busy signal, so I turned to my accountant for info. He said that basically once you hit 30k you have to register for GST and start charging.
Simple enough!
D
Saturday, July 7, 2007
Two Weeks Later
Well almost two weeks later. I've now completed my last week at the old place, and have started my first half-week at my first contract (they didn't need me to start until Wednesday at 10AM).
Things are going great so far. The biggest difference I'm noticing is that I'm getting my passion for development back again...getting excited to jump in and work with the code.
An update on the liability question: my placement company does actually cover me for E and O liability insurance, so I'm fully covered no matter what. They've been great in keeping contact with me as well over the last few weeks, and they seem genuinely as excited about the placement as I am.
CC
Things are going great so far. The biggest difference I'm noticing is that I'm getting my passion for development back again...getting excited to jump in and work with the code.
An update on the liability question: my placement company does actually cover me for E and O liability insurance, so I'm fully covered no matter what. They've been great in keeping contact with me as well over the last few weeks, and they seem genuinely as excited about the placement as I am.
CC
Monday, June 25, 2007
Back from Holidays
Sorry for the delay in posting. I was on holidays for a few weeks there.
So everything is pretty much a go now. I'm going to be starting my contract on July 3rd, and I just need to sign the paperwork and forward that in.
I learned something else about the placement company I'm going through: they have a policy to keep 40 hours of work from your first cheque as a security deposit. This is to cover any loses such as if a contractor was to keep equipment, or some other reason...its basically like a safety deposit on an apartment...just not for an apartment, but for a contract.
I'm also still fuzzy on the whole thing of individual insurance and liability. They do provide insurance, but that's more for if a server rack falls on you. I want to know whether they cover liability for error and ommission type stuff.
This is actually pretty important to have. Let's say that you work somewhere with an unscrupulous manager. Maybe a key feature gets missed from the product you're contracted to work on, but it was never communicated to you to fullfill. The manager blames you for the ommission, and for the product failing to meet its launch date. Now what do you do? Unless you've done a thourough job of CYA, you could be hooped and hit with large legal bills to defend yourself.
So I'm waiting to hear back on that, but I should also be looking for it personally regardless I think...in case I wanted to do side contract work as well that was outside of the boundaries of the placement company.
Edit: Found this online article listing companies that provide E&O Insurance
http://www.investmentexecutive.com/client/en/News/DetailNews.asp?Id=37216&cat=30&IdSection=30&PageMem=&nbNews=&IdPub=141
CC
So everything is pretty much a go now. I'm going to be starting my contract on July 3rd, and I just need to sign the paperwork and forward that in.
I learned something else about the placement company I'm going through: they have a policy to keep 40 hours of work from your first cheque as a security deposit. This is to cover any loses such as if a contractor was to keep equipment, or some other reason...its basically like a safety deposit on an apartment...just not for an apartment, but for a contract.
I'm also still fuzzy on the whole thing of individual insurance and liability. They do provide insurance, but that's more for if a server rack falls on you. I want to know whether they cover liability for error and ommission type stuff.
This is actually pretty important to have. Let's say that you work somewhere with an unscrupulous manager. Maybe a key feature gets missed from the product you're contracted to work on, but it was never communicated to you to fullfill. The manager blames you for the ommission, and for the product failing to meet its launch date. Now what do you do? Unless you've done a thourough job of CYA, you could be hooped and hit with large legal bills to defend yourself.
So I'm waiting to hear back on that, but I should also be looking for it personally regardless I think...in case I wanted to do side contract work as well that was outside of the boundaries of the placement company.
Edit: Found this online article listing companies that provide E&O Insurance
http://www.investmentexecutive.com/client/en/News/DetailNews.asp?Id=37216&cat=30&IdSection=30&PageMem=&nbNews=&IdPub=141
CC
Monday, June 11, 2007
Reviewing the Startup Checklist
I posted a while back about the "Startup Checklist" that I had, and wanted to revisit it now that hindsight is 20/20.
Register Business and Licensing/Permits
I was able to register my business with the city for licensing and permits without actually registering the business name officially, although its always a good idea to do it in that order. I was fuzzy on which departments did what, so when I went to the city and got my license and permit paid for, they told me it was a different branch of the provincial government (not the city) that dealt with that. So here's how it goes:
Provincial Government
- Check if your name is available
- Register your name once you have confirmation its available
City Government
- Check to see what type of license/permits you require
- Go to the department office to submit the info requested and pay for any license/permit
Lawyers and Accountants
As a sole proprietorship, you don't need a lawyer. I was able to set everything up without needing any information or advice from one. However, if you are going to be handling your own contracts (as in writing up your own contracts), you'll probably want to have one available. I'm going through a head-hunting firm, so they take care of all that stuff for me.
You also, surprisingly, don't need an accountant either...well, not in the same capacity as if you were incorporated maybe. I met with a great accountant who gave me a tonne of free advice, and basically told me that as a sole proprietorship I just need to keep track of receipts and come see them at tax time.
Error/Ommission/Liability Insurance
I don't have to worry about this because the head-hunting company provides the liability coverage, which is great! Apparantly its crazy expensive to get it for yourself.
Laptop/Software
You obviously need to have good hardware to develop off of. Even if you are going to be provided with a computer at your contract location, you need to be brushing up on your skills at home and playing with the latest and greatest. I'm still toying with what I really need...Lenovo, Mac Book Pro, or just an HP model...not sure...
For software, its REALLY important as an independent that you go to as many community-based events as possible, as the handouts are as good as gold. Over the last few years, I've built up free licenses for Visual Studio 2005, SQL Server 2005 Developer, Office 2007, and some control suites...which all come in handy when you're on your own and on a budget. Otherwise, you're paying quite a bit in startup costs for getting all that through an MSDN subscription or another means.
Health Insurance
I still haven't looked into this too much...I probably should though.
CC
Register Business and Licensing/Permits
I was able to register my business with the city for licensing and permits without actually registering the business name officially, although its always a good idea to do it in that order. I was fuzzy on which departments did what, so when I went to the city and got my license and permit paid for, they told me it was a different branch of the provincial government (not the city) that dealt with that. So here's how it goes:
Provincial Government
- Check if your name is available
- Register your name once you have confirmation its available
City Government
- Check to see what type of license/permits you require
- Go to the department office to submit the info requested and pay for any license/permit
Lawyers and Accountants
As a sole proprietorship, you don't need a lawyer. I was able to set everything up without needing any information or advice from one. However, if you are going to be handling your own contracts (as in writing up your own contracts), you'll probably want to have one available. I'm going through a head-hunting firm, so they take care of all that stuff for me.
You also, surprisingly, don't need an accountant either...well, not in the same capacity as if you were incorporated maybe. I met with a great accountant who gave me a tonne of free advice, and basically told me that as a sole proprietorship I just need to keep track of receipts and come see them at tax time.
Error/Ommission/Liability Insurance
I don't have to worry about this because the head-hunting company provides the liability coverage, which is great! Apparantly its crazy expensive to get it for yourself.
Laptop/Software
You obviously need to have good hardware to develop off of. Even if you are going to be provided with a computer at your contract location, you need to be brushing up on your skills at home and playing with the latest and greatest. I'm still toying with what I really need...Lenovo, Mac Book Pro, or just an HP model...not sure...
For software, its REALLY important as an independent that you go to as many community-based events as possible, as the handouts are as good as gold. Over the last few years, I've built up free licenses for Visual Studio 2005, SQL Server 2005 Developer, Office 2007, and some control suites...which all come in handy when you're on your own and on a budget. Otherwise, you're paying quite a bit in startup costs for getting all that through an MSDN subscription or another means.
Health Insurance
I still haven't looked into this too much...I probably should though.
CC
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