Part 2 – Are You an Employed or Self-Employed Canadian?

4 Key CRA Factors to Consider……Continued

15201008_sIn my last blog post, I discussed 4 key factors to help you discern whether you would be considered an ‘Employee’ or ‘Self-employed’ according to CRA standards.  I also covered the first factor, that of “Control”.  This week, I will cover the second and third factors; “Ownership of Tools” and “Chance of profit/Risk of Loss”, factors that you must analyze in your relationship to business or person that pays you.

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Are you an Employed or Self-Employed Canadian?

4 Key Factors to Consider

Whether you are a Canadian that considers yourself self-employed (independent contractor) in your employment, it’s the CRA that has the final word on how your income and taxes should be reported.  That being the case, it is then logical for you to know the criteria guidelines the Canadian Government uses to make those decisions. A couple of years ago the CRA offered a publication titled “Employee or Self-Employed”? which is no longer available in print or online. Some of the details of that publication are outlined below.

Here are the 4 Key Factors you must analyze in your relationship to the business or person that pays you.

1)     Control

2)     Ownership of Tools

3)     Chance of profit/Risk of Loss

4)     Integration

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3 Canadian Business Structures to Consider

To Incorporate or Not to Incorporate – Very Good Question

I’m frequently asked by new and current clients if they should incorporate.  In most cases the answer is not straightforward as there are a number of issues to consider;

  • Is your type of business vulnerable to lawsuits?
  • How much control do you want to have?
  • Are you planning to re-invest earnings into the business?
  • To what degree can you see your business growing?
  • Are you aware of the tax implications of the different ownership structures?

Below are the 3 Canadian basic business structures and their description, along with the Pros and Cons of each..

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5 Reasons to Outsource Your Bookkeeping

Hello and welcome to my Blog!  There are so many good reasons to outsource your bookkeeping.  Many business owners find looking after the financial side of their business to be a tedious and worrisome task.  Here are 5 great reasons to consider outsourcing your bookkeeping.

1)     Work ‘on’’your business not ‘in’ it.

It is extremely valuable for you to understand your financial statements, but you don’t need to be the one spending the time entering and reconciling.  That isn’t why you started your business, and it isn’t making you money. Focus on what you do best.

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