Koroll & Company Blog

Now that the New Year is almost here, it’s time to start making some year-end tax planning decisions, especially related to an RRSP and TFSA. 

When deciding how to compensate your employees, there are many different options. The traditional methods are salaries, wages, bonuses and benefits. There’s also a system called profit sharing. 

Profit sharing is a compensation program that awards employees with a portion of the company’s profits. The amount received is usually based on quarterly or annual earnings. Though it could be for a longer or shorter period.

When the pandemic started, the government was focused on getting money to recipients as quickly as possible. The goal was to mitigate financial struggles that many were suddenly facing. 

The problem is, some Canadians received more than they should have. This resulted from three major elements of the payment distribution.

It’s that time of year when you should be sitting down to do a mid-year review of your taxes. This is an opportunity to look over your business finances and processes to confirm that everything is going to plan.

Once you get a good understanding of your position, you can look for ways to better set yourself, and your business, up for success come year end and tax season.

The terms accountant and bookkeeper are often used interchangeably. While there are some similarities in what they do, they are more different than you may know. 

As your business grows, managing your finances can get more challenging, which means you will need to bring someone on to help. But the question is, do you need an accountant, a bookkeeper or both?

When you use a vehicle for business purposes, you can deduct some or all the expenses from your business income. 

The percentage you claim will depend on what percentage of the vehicle use is used to earn income. For example, if you drive the vehicle 50% of the time to run a personal errand and 50% to earn business income, you can claim 50% of the expenses.

The Federal Budget was released earlier this year. While no changes were made to tax rates, there were several introductions and increases to credits and deductions, with a focus on residential property, that may have an impact on your end-of-year taxes.

In 2021, the federal budget announced that there would be a consultation regarding reporting requirements for certain transactions. This is because the government recognized a lack of “timely, comprehensive and relevant information on aggressive tax strategies” as a major challenge faced by the CRA and tax authorities worldwide.