The Chef Alliance
WRITE OFF AUTO & HOME-OFFICE EXPENSES, IF APPLICABLE
Many entrepreneurs of small businesses use a home-based office space. Expenses related to this space can be written off against income. To do this, calculate the percentage of space in your home that is used for your business, then allocate that percentage of home-related expenses (including electricity, property tax, gas, water etc.) as business expenses from your gross income.
Auto expenses can be calculated in a similar manner, using the percentage of mileage that is used for business purposes against the total auto expenses.
Be sure that the percentages used are reasonable, to avoid triggering an audit.
If you have employees, the CPP/QPP contribution is split equally between the employer and employee. If you are self-employed, you are responsible for the full amount of pensionable earnings. For the current amount required to be paid, contact the Canada Revenue Agency or ask your accountant.
PLAN AHEAD FOR TAXES OWING
Businesses have to file taxes based on what is earned, not what is collected. This means that if there are invoices that you issued for which you have not received money, taxes also need to be paid for these unpaid invoices. Conservatively putting aside funds on a regular basis to meet your tax commitments will reduce stress when it comes to making scheduled tax payments.
Business tax filings are generally due on June 15th each year, but if you have a payment owing, you are required to pay it by the April 30th, or the next business day.
Once you are in business for a full calendar year, the CRA may require you to make quarterly instalments instead of a one-time payment in April.
The information provided was current at the time of writing. For more up-to-date information, contact the Canada Revenue Agency or your accountant.
The Chef Alliance is the leading organisation of Private & Personal Chefs & Caterers in Canada offering Chefs a place to locate jobs, meet new clients, grow their business, benefit from peer support, discounts to lower their business costs, marketing services & much more. This allows Chefs concentrate on what they do best - cook great food!
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