Entrepreneurship & Small Business

Post your CORPORATE TAX questions here

  • Last Updated:
  • Apr 6th, 2018 11:01 pm
Tags:
None
Newbie
Oct 24, 2008
92 posts
19 upvotes
Toronto
Hello:
I am about to open a corporation and my questions are:
1. Should I set my financial year to the Jan 31 same as my personal taxes or it's better to have somewhere in the mid of year?
2. If I will include my spouse as an director and will pay her dividends only, should I pay her pension plan as well? Or she only will report dividends on her personal tax return, and the corporation will not have to pay taxes or pension plan for her?
Thanks!
Newbie
Nov 28, 2017
3 posts
1 upvote
Hello,

Have an Ontario corp setup in 2011 and only have a chequing account setup with the bank. Only transactions so far is interest income and monthly bank fees. Wondering if I can use the T2 Short form to file with CRA?
Have only generated interest income from the bank and monthly bank fees for expenses. For 2014, corp earned $8.04 interest income and bank account expenses $ 2.72, other years only received minimal interest income and no expenses for bank charges. Thanks.
Deal Addict
User avatar
Jul 22, 2004
1698 posts
37 upvotes
ETOBICOKE
the CRA website will tell you what types of returns are allow for T2 Short returns.
Smiles2425 wrote:
Jan 31st, 2018 1:01 pm
Hello,

Have an Ontario corp setup in 2011 and only have a chequing account setup with the bank. Only transactions so far is interest income and monthly bank fees. Wondering if I can use the T2 Short form to file with CRA?
Have only generated interest income from the bank and monthly bank fees for expenses. For 2014, corp earned $8.04 interest income and bank account expenses $ 2.72, other years only received minimal interest income and no expenses for bank charges. Thanks.
Looking for an educational source to help pass your G1 written driving test? Check out DrivingTests101.com
It helped me pass my test and had a lot of great resources!
Newbie
Feb 8, 2018
1 posts
First would like to thank everyone here in providing the help any sort.

Hello,
I am doing the taxes first time (first year). I paid dividend throughout the corporation year. Now at the end of year when I am preparing the financial statements I have couple questions.

My year end bank account balance was 10000$ (I am just putting a number to understand.)
Total Sales before taxes 1,00000 $ (I am in Alberta so GST 5 %)
Corporation Income Taxes payable (I didn't paid any during the year as it was my first year). 10,000 $
Let's say all my expenses are 10,000 $


Income statement net profit 80,000 $


while in my Balance Sheet

Total Asset = 10,000 $ (per year end bank statment, assuming no other assests and accounts receibable)
Total Equity beome 0$ after paying Dividend paid through out the year 80,000 $
Total Liabilities = Account payable (assume it is 0 $) + GST payable (assume it is 5,000 $) + Income tax payable (10,000$) = 15,000

Total liab & Equity become 15,000$

I hope I explain it as best of my ability but if you need any further questions please feel free to ask.

In this case now I have less asset than total liab & Equity. Is this is a problem ? If yes how I can correct it please advise.

Any help in this regard is appreciated.

Thanks again and hoping to hear back from experts soon.

-MK
Newbie
Jan 28, 2018
2 posts
My sister owns a unit in a plaza. The owners now get together to set up a corporation to manage the repairs and maintenance of the common areas. Every owner has contribute some money to the corporation for this purpose. How should she report the money received from the owners on the T2 return? Should that be income for the corporation? Would that be taxable?
Thank you.
Sr. Member
Jan 13, 2005
814 posts
65 upvotes
Montreal
What is the new tax law about corporation and dividend payed to minors and other minority shareholder ?
Sr. Member
Nov 13, 2006
651 posts
349 upvotes
googbargain wrote:
Feb 13th, 2018 6:37 pm
My sister owns a unit in a plaza. The owners now get together to set up a corporation to manage the repairs and maintenance of the common areas. Every owner has contribute some money to the corporation for this purpose. How should she report the money received from the owners on the T2 return? Should that be income for the corporation? Would that be taxable?
Thank you.
Shareholders Equity. Page 2 on S100.
Sr. Member
Nov 13, 2006
651 posts
349 upvotes
googbargain wrote:
Feb 13th, 2018 6:37 pm
My sister owns a unit in a plaza. The owners now get together to set up a corporation to manage the repairs and maintenance of the common areas. Every owner has contribute some money to the corporation for this purpose. How should she report the money received from the owners on the T2 return? Should that be income for the corporation? Would that be taxable?
Thank you.
not taxable as they are owners of the corporation, its a balance sheet item, more specifically a shareholders loan.
Deal Addict
User avatar
Mar 8, 2004
2989 posts
628 upvotes
Mississauga
Question about Box 14 (Line 101)— Employment Income on a salaried Employees T4.

Does this amount include the Employee CPP & EI contributions & payroll tax deductions?

I guess what I am asking is if the "salary" declared in Box 14 is prior to the contributions and payroll tax withholding?
Sr. Member
Nov 13, 2006
651 posts
349 upvotes
Tig wrote:
Feb 14th, 2018 11:21 am
Question about Box 14 (Line 101)— Employment Income on a salaried Employees T4.

Does this amount include the Employee CPP & EI contributions & payroll tax deductions?

I guess what I am asking is if the "salary" declared in Box 14 is prior to the contributions and payroll tax withholding?
Yes BOX 14 LINE 101 is gross payroll before taxes and before CPP/EI.
Deal Addict
User avatar
Mar 8, 2004
2989 posts
628 upvotes
Mississauga
asifnana wrote:
Feb 14th, 2018 12:17 pm
Yes BOX 14 LINE 101 is gross payroll before taxes and before CPP/EI.
perfect, Thank you sir.
Deal Addict
User avatar
Mar 8, 2004
2989 posts
628 upvotes
Mississauga
ok so I realized that I accidentally mixed up one of my 2016 Corporate Tax installments with the Salary that my Corporation pays me. So in essence this amount got added to my personal income. How do I go about correcting this? Do I just file an amended T4? or do I call the CRA and explain what happened?
Newbie
Jan 28, 2018
2 posts
asifnana wrote:
Feb 14th, 2018 9:29 am
not taxable as they are owners of the corporation, its a balance sheet item, more specifically a shareholders loan.
Then when you report the expenses (plaza maintenance expenses, it would be on the income statement, right? That means the company would have a loss? Shouldn't the owners' contribution be used to offset the expenses? How do you treat the difference (contribution less expenses?) So what exactly would the entry be?
Thank you for the help.
Sr. Member
Nov 13, 2006
651 posts
349 upvotes
Tig wrote:
Feb 14th, 2018 2:30 pm
ok so I realized that I accidentally mixed up one of my 2016 Corporate Tax installments with the Salary that my Corporation pays me. So in essence this amount got added to my personal income. How do I go about correcting this? Do I just file an amended T4? or do I call the CRA and explain what happened?
File a t1 adjustment.

Information is here :

https://www.canada.ca/en/revenue-agency ... 1-adj.html

If you have a login to cra my individual account you can do it there too.

Along with the form I recommend you write a letter explaining what you entered wrong and why etc...

Takes about 8 week if you do it via mail and 2-3 weeks if you do it online

Top