Entrepreneurship & Small Business

Post your CORPORATE TAX questions here

  • Last Updated:
  • Jun 25th, 2017 5:00 pm
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Newbie
Jan 1, 2008
57 posts
Mississauga
SirLookout4Deals wrote:
May 10th, 2016 6:07 pm
Do you know for certain that your income was treated as a salary? If so a T4 should be issued. If it hasn't been you would need to to create and file one even though your corporation has dissolved.

Could your income have been declared as a dividend? If so a T5 should have been issued with the same issues as above.

I would go through and check your corporate income statement and see where it was recorded. It might have even just been recorded as a payable by you to the corporation, so check your corporate balance sheet as well.
Hello, thanks for the reply. Actually I just talked to my accountant recently and she said she reported my income as a 'management fee'. She files my personal income as a self-employed business (form T2125). But she doesn't claim any business expenses because she already claims them in my T2 corporate return which in turn makes my tax owing in my personal income tax return ridiculously high (around $2500 + the corporation tax owing of $2000-$2500). So in total I pay almost $5000 every year for the tax which I could no longer afford hence the reason I dissolved my corporation.

So can anybody else confirm if it is still possible to issue myself a T4 from my corporation which was just recently dissolved? Would issuing T4 help me somewhat lower my tax owing or it would not make any differences? I am going through all this hustle and headache of filling my own T1 and T2 because I could no longer afford my accountant to pay another $700. Please help I would greatly appreciate it.

Thanks a lot.
Member
Jul 4, 2012
360 posts
25 upvotes
Calgary
Question
1. What do I need to file corporate tax? access code and anything else?
2. Can I file AT1 online too? what do I need? is there access code for that?
3. does future tax software have a function to file online?

Thank you
Newbie
Feb 10, 2015
10 posts
East York, ON
If I accrue a bonus payable at year end (Dec. 31, 2015 year end). Are the source deduction remittances on that bonus due in January 2016 or at the time I actually pay out the bonus within 179 days of Dec 31, 2015?
Newbie
Dec 27, 2016
1 posts
Hi,

I own my own corporation, doing IT contract work. My wife and I have both been drawing a salary but we have accumulated a fair bit of money that is reatined in the corporation.

Our contracts are done soon and we are not certain of obtaining more work.

My understanding is that we can pay ourselves wages for up to 3 years even though we are not generating revenue. Is this correct ?
Newbie
User avatar
Mar 4, 2002
85 posts
Hi

I have my own corporation doing contract work. 2016 is my first year. I got my accountant to do my HST quarterly, book keeping and year end. She charge me a more then I thought. Just wondering how much do you charge for all that?
Member
Feb 15, 2010
423 posts
232 upvotes
Surrey
tomboy84 wrote:
Dec 28th, 2016 3:39 pm
Hi,

I own my own corporation, doing IT contract work. My wife and I have both been drawing a salary but we have accumulated a fair bit of money that is reatined in the corporation.

Our contracts are done soon and we are not certain of obtaining more work.

My understanding is that we can pay ourselves wages for up to 3 years even though we are not generating revenue. Is this correct ?
I have no knowledge of this statement. However, I would say why not just pay yourself dividends from the company? You'll get a better tax credit, and will not have to pay payroll taxes. Though, it will reduce your ability to contribute to RRSP and future OAS withdrawals.
Member
Feb 15, 2010
423 posts
232 upvotes
Surrey
babu889 wrote:
Dec 31st, 2016 11:47 pm
Hi

I have my own corporation doing contract work. 2016 is my first year. I got my accountant to do my HST quarterly, book keeping and year end. She charge me a more then I thought. Just wondering how much do you charge for all that?
There is not enough information here to indicate how much any of this should cost. It would heavily depend on the amount of bookkeeping required. More transactions = more money. HST returns are simple to prepare if you have proper bookkeeping records. Year end tax work will vary depending on tax planning/needs. Does this include just your year end tax return and/or financial statements? Preparation of T-slips and your personal return? Etc.

I will ask though are you using a designated accountant to perform all your work? If so, that will certainly increase your costs. In that case (as a general rule of thumb) I would recommend getting your day-to-day bookkeeping and HST returns prepared by a bookkeeping firm, as these items generally require less accounting knowledge and skill, and have your year end work performed by your accountant. A bookkeeping firm will likely charge between $30-$60/hour which is significantly less than a designated accountant which is $100+ at a minimum.
Newbie
Jan 21, 2017
1 posts
Hi,
I am running an Alberta Corporation (IT consulting), I got a full time contract in ON. So I registered the company as extra provincial corporation and doing business in ON while doing few other tasks for AB clients. Also I maintained the corporate office in AB, as it's mandatory for AB corporation.

However personally I moved to ON and took up the residency here. My question here, how can I claim the moving expenses?
1) As part of personal tax fling
2) Or as part of the business tax filing ?

Thanks
Deal Fanatic
Mar 20, 2003
9991 posts
373 upvotes
Moncton, NB
Hi,
My wife is a consultant running her own business as a corporation. The only reason she has a corporation is because her first accountant told her she HAD to or she'd eventually regret it (she scared her into it basically- she's since switched accountants after discovering this one was incompetent and my wife had large penalties to pay to CRA). So she had incorporated and now pays quite more than she does in taxes and fees vs. being a sole proprietor. She has no employees and the few times she needs help it is via subcontracting and not be staffing anyone. Her income is fairly modest, let's say 50-60k on a regular year, maybe 100k on a fantastic year and the risk of liability is slim as her work is not the kind which results in risks both financial or to personal safety.

For the last few years she has been paying herself a modest salary meaning she accumulates very little RRSP room and pays very little in CPP. Based of this, she has now switched to dividends only as per our advisor. To offset the lack of RRSP/CPP she has started investing in a retirement plan through the company but now she is doubting the need for the corporation at all.

So the questions:
1- Is it worth keeping the corporation?
2- How much cheaper would it be to have personal income taxes done vs. personal&corporate taxes?
3- If she goes back to sole proprietor, must she take out all the money in the corporation at once?
4- Does she accumulate RRSP contribution room on all the money made as a sole proprietor?

I'm thinking even if it costs a few thousands to close the corp it would still be much cheaper in the long run.
KitKat item collector- always looking for swag or branded items.
Member
Nov 21, 2008
441 posts
106 upvotes
Ontario, Canada
Hi

Question #1
Which of the following NAICS code businesses in Ontario do qualify or don't qualify for the Small Business Deduction (as a corporation)?
115210 Boarding horses (except racehorses)
212323 Sand and gravel mining and quarrying
531120 Lessors of non-residential buildings (except mini-warehouses)
531190 Agricultural property rental leasing
532112 Passenger car leasing
532120 Truck, utility trailer and recreational vehicle (RV) rental and leasing
532420 Office machinery and equipment rental and leasing
532490 Other commercial and industrial machinery and equipment rental and leasing

Question #2
What happens when a corporation has several of these categories and some qualify for the SBD and some don't? Can you assing the SBD to the portion of income that qualifies?

Thanks
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+++ This is not legal advice, just my opinion! +++
Newbie
Feb 25, 2017
6 posts
Quick question - I filed my T4 with my account # XXXXXRPXXX, I am trying to file my T5, BUT the same account number doesn't work, I tried RT/RC...does anyone know what account # I use to file a T5?
Newbie
Feb 25, 2017
6 posts
treadwater28 wrote:
Feb 26th, 2017 11:39 am
Quick question - I filed my T4 with my account # XXXXXRPXXX, I am trying to file my T5, BUT the same account number doesn't work, I tried RT/RC...does anyone know what account # I use to file a T5?
Apologize agian for the mulitple posts - figured it out to be RZ out of the below accounts (found the accounts page finally)


RT - Goods and Services Tax/Harmonized Sales Tax
RP - Payroll
RC - Corporate Income Tax
RM - Import/Export
RZ - Information Return
Newbie
Mar 4, 2017
2 posts
Doesn't seem like anyone is responding but at what point would be advantage to declare dividends?
Newbie
Jun 21, 2015
33 posts
Toronto, ON
Hi Guys, I believe this question was asked earlier in the thread as I was looking through but did not find an answer.

If a Canadian corp registers a corp in the us (Delaware). How do taxes work? I do not have a permanent establishment in the US. The head office is in Canada, some of the operating costs are in canada ( rent, internet, durniture etc) but most of the business expenses are paid through the US accounts as all the partners and clients are US based. So I needed a US based business account and sought to register a corp in the US but do not want to be double taxed either. If anyone can refer me some articles or books to read also some advice on what i need to do and what forms i would need to fill out with the IRS/CRA to avoid double/higher taxation. Really appreciate any input. thanks guys.
Newbie
Feb 23, 2011
6 posts
Hi I started building houses in 2016 in B.C. as a sole proprietorship. I built two houses and sold one a few months back for a profit. The second house has not sold and I was going to keep (the second house) as my principal residence. I do not currently have a principal residence. I had claimed ITC on the land and house and was going to pay back the GST based on my cost. The fair market value of the house (according to a CMA from two Realtors) would be about $30,000 to $40,000 higher than my cost. Would I be liable to repay the GST based on the cost basis or FMV basis. There should be no income to claim as it is at cost. What proof would I need for the FMV. The property is already in my name as I am not incorporated.

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