|
|
Like this article? PLEASE +1 it! |  |
|
Starting Up Your Own Small Business?
| Guest post by: Brenda Parker |
Article Overview: Accounting and tax issues to consider when starting up a new small business.
 |
Free Download - Accounting - Beyond the Tax Return By Brenda Parker |
Starting Up Your Own Small Business?
It's a sunny spring day and you jump out of bed with lots of energy to get the yard work done and prepare for the warm season ahead. You sit down for breakfast to enjoy the fresh eggs and the delicious maple syrup on your pancakes from the farm down the road. You rush out the door, grabbing your rake on the way by. You notice the broken handle on it and realize that you'll need to take a little detour to Tom's hardware store down the road. Your wife then yells out the door. There's no water! A plumber is needed immediately. Step back for a moment. Look at how much we depend on others to help us through the day, the plumber, the hardware store owner and the farmer. They are small business owners, three of an estimated 3,000,000 small businesses in Canada.
A business with one owner may chose to operate as a sole proprietorship or if there are two or more owners, a partnership. Alternatively, the owner(s) may incorporate. No legal structure is inherently better than the other. The best choice depends on various factors and the circumstances. A business will often begin as a proprietorship or partnership, and then incorporate at a later stage.
Proprietors have more issues to consider in preparing their tax returns than employees, investors and pensioners. The focus should be on family planning since business income is an easier type of income to split than income from other sources. In order to be able to claim expenses and not have it viewed as a "hobby", the business must have the potential to generate profit. It is recommended that when you start a business, you should carefully lay out you plans on paper. Keep a journal about your thoughts on advertising, opportunities in the market, pricing, financing, etc. Be able to show that you honestly feel that the business will generate a profit for you in case this is challenged down the road. Even the best planned intentions can go wrong, but at least a well laid out plan will express what you thoughts were.
When starting your business, try to set up a separate bank account from your personal account. If it is audited by CRA, you will be showing them your business transactions only and not having you personal affairs mixed in there too. Also, auditors remain happier when the audit trail is clean and clear. It leads to less headaches. It is important from day one to have a proper accounting system set up. Your business may be small enough that a manual ledger will suffice. However, as your business grows, you may find that a lot of your time is consumed with running the business and your time to record the transactions is less. Many sole proprietors use computer based software such as Simply Accounting or QuickBooks to maintain a proper ledger. These programs are relatively inexpensive and will generate useful information for you to help monitor and plan your business, just as long as the input is done correctly. It is important to speak to a qualified accounting professional when planning your accounting system. What comes out of the program is only useful if it is entered properly.
Sole proprietors report their income on their personal T-1 return each year. When most people are scrambling to get their returns in by midnight on April 30, sole proprietors and their spouses have a time extension. Although they are still subject to interest being charged on what they owe at April 30, their return is not due until June 15th. Penalties are charged after that date. If June 15th falls on the weekend, as is the case this year, the return is due on the next business day.
So, get back to your yard work and enjoy the upcoming season. Support the businesses in your neighborhood and they'll be there when you need them.
Small Home Business Ideas
Starting a web based business
How to start a home based business
Make A Fortune Starting With A Small Budget In Multi Level Marketing Opportunities! ~REVEALED
How to Start a Small Business in the State of Missouri
Are Franchises the Answer to Starting a Small Business?
Starting a Work at Home Business in Canada
A Small Internet Business Could Enable You To Quit Your Job
Targeting Your Niche Made Simple – Start Small, Grow Later
Formal Networking Groups
The Top 3 Mistakes to Avoid in Your Home Business
: Challenges of Starting a New Business
Bootstrapping: How Cutting Down May Be the Key to A Successful Small Business
Top 10 Tips to Starting Your Business
What Does The Initial Franchise Fee Cover?
You Can Juggle a Franchise and a Family
Advice for New Entrepreneurs And Business Owners
How to Start a Small Business in the State of Iowa
Why Entrepreneurs Are Like The Long Shot At Del Mar
Starting Small In Taking Responsibility To Build Relationships
Article Tags: accounting, small business, tax issues
|
About the Author: Brenda Parker RSS for Brenda's articles - Visit Brenda's website
Brenda Parker operates Scotia Accounting and Tax Services located in Stellarton, NS, Canada. After graduating summa cum laude from St. Mary's University in Halifax with a B Comm in Finance and a BA in Economics, she worked for a national grocery firm in various departments with her last role being assistant manager of Taxation. During this time she attained her Certified General Accountant's designation. Since getting her CGA, she has worked in various management/accounting positions for government ,public accounting firms, and as controller of a regional hotel chain and a new car dealership. She is a Simply Accounting Certified Consultant and Quickbooks partner. In her accounting practice she has served both large and small clients in a wide variety of sectors. From personal taxes to businesses in manufacturing, wholesale, retail and services to charities and not-for-profit organizations. She has clients from Cape Breton Island, NS to Montreal, Quebec to Calgary, Alberta and in many locations in mainland NS. All information in her articles is offered without prejudice and she advises readers to consult a professional accountant in person in regards to their personal situations. Click here to visit Brenda's website   Whats New for 2009 Personal Tax Returns Are you an Employee or a Self Employed Individual Moving Expenses Is Your Business Storm Proof Part 2 Back to School tax tips 2 |
Related Forum Posts
My entry
- 1. The Best Business Books Ever: The 100 Most Influential Business Books You'll Never Have Time to Read
- this is a fascinating book about the history of Business theory, and I'd recommend it to anybody.
2. The Big Book of Small Business: You Don't Have to Run Your Business by the Seat of Your Pants, by Tom Gegax. Ditto.
3. PADI: The Business of Diving Book
Okay, so this book won't be of use to anyone who doesn't want to start a scuba store, but I did, and this book was of course invaluable to me in reaching that goal.
These maybe the coldest franchises out there:
- Here are the worst 15 performing franchises in regards to having the highest Small Business Administration (SBA) loan failure rates. The list is dotted with sub sandwich shops, fitness centers and car shops.
WORST FRANCHISE LOAN FAILURES Failure %
1 OBEE'S SOUP SALAD SUBS 55.56%
2 LADY OF AMERICA 41.94%
3 COUNTRY CLUTTER (BED & BREAKFAST) 41.18%
4 COPY CLUB 36.36%
5 ALL TUNE AND LUBE 35.71%
6 PICKERMAN'S 35.71%
7 PHILLY CONNECTION 35.59%
8 ROLY POLY ROLLED SANDWICHES 34.78%
9 COTTMAN TRANSMISSION 34.48%
10 HAIR COLOR EXPRESS 33.33%
11 LEE MYLES AUTOMOTIVE TRANSMISSIONS 33.33%
12 GODFATHER'S PIZZA 33.33%
13 SMOOTHIE FACTORY 33.33%
14 BLIMPIE 31.39%
15 GOLF U.S.A. (RETAIL GOLF EQUIP.) 30.77%
Source: Small Business Administration, SBA Loan Performance Within Franchise Code for the Period of FY 2001 - 2005
Exclusive: Interview with Results
- Hi Forum Members,
I'm helping start up a Business Coaching and Consulting company here in Toronto, Ontario, Canada (a Subsidiary of RSC Business in Los Angeles).
As a Research and Development Intern I am required to practice my listening and interview skills by surveying Small and Medium Businesses on thier Business.
This Survey is designed by RSC Business to also assist the Business being interviewed more insight into their own business.
I am looking to interview about 30 businesses across North America over the span of 3 months.
At the end of these interviews I will be publishing a report of the results and they will be made available for free to the Interviewees. The Report data will include responses from a minimum of 100 interviews.
I would like to extend this opportunity to members of the Forum.
If you would like to have this short 20-30 minute interview conducted on your Business and you reside in North America please send me an email or PM.
Please contact me at andy[at]jvprosperity[dot]com to arrange our interview and to get free access to the results when they are published.
Re: Biz Plan Competition
- i just wanted to say that posting Small Business Events on CanadaOne is a great resource. Thanks Julie!
New Small Business Topic
- Hello everyone,
I'm on the lookout for new topics to add to my site. We just launched a Franchising section and are planning Human Resources section. Do you have any thoughts for a new section?
Here's a list of what we currently have:
Angel Investors
Branding
Bank Loans
Business Coaching
Business Plan
Franchises (New)
Insurance
Legal
Marketing
Public Relations
Sales
Small Biz Loans
Venture Capital
Share this article with your friends. Fund someone's dream.
Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.
by: Erin Ferree, Small Business Branding Coach
Build Your List with Joint Venture Giveaway Events
May 2012 Top 100 Social Media Experts to Follow on Twitter
What to measure to be phenomenally successful in business
10 mistakes of media relations
Making Money Blogging Can Be Tons Of Fun 
Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!
Common Sense Stress Management
Ten Ways to Make Blogging Work for Your Business
Effective Leadership
Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.