Trudeau going after Personal Services Corps disguised as small businesses
These are quotes from Garth Turner blog a few days ago. I do not use the blog for investment advice but I use it to get fresh news and he seems to be pretty well connected and he is able to find in advance some of the thigs that are in the pipe for mortals like us
Apparently after getting the country even deeper in debt Trudeau's guys are now tightening the screws to squeeze more money from the working class
I have read the CRA papers on this and you are not a small business if either:
-you do not have 5 full time employees
-you have one or few constant clients and you do not have control over your tools and work hours. You also need to invoice regularly your clients
While you might not have 5 full time employees you might change your clients from time to time, you might not have permanent employment and you may have your own tools
Is the 5 employee cause mandatory?
What do you think of the above ?
In short, the perfect liberal budget. Now there’s more. The next one will turn on the spending tap further since job creation last year sucked, reduce corporate tax breaks and bring in the Doctor Tax, lowering the boom on people who get paid through professional corporations. In so doing, the contrast between us and the deplorables to the south will widen.
(The speculation is that the T2 gang will target people like docs, IT contractors, other medical professionals and self-employed entrepreneurs who spread tax by taking dividend income, employing family members, giving relatives non-voting shares and others things lefties don’t get and are therefore evil.)
And from the comments section
“I kind of feel like a crook doing this, but it’s all legal and all IT contractors do it. I welcome the closing of this loophole, if it really happens, as I feel that everyone should be paying their fair share of tax. Bring it on. “
Not all consultants to it and you are wrong that it’s all legal. Rules were put in place in 2011 regarding Personal Service Corps. I think the CRA waited a few years , so when they come, they’ll get their pound of flesh. As a business owner you should keep abreast of the laws of the land and not depend on an accountant.
Did you modifying how you run your business in 2012? If the CRA comes for an audit and your corporation is deemed a PSC, you’d have years of taxes to pay.
http://www.thebluntbeancounter.com/2012 ... rvice.html
https://www.thebalance.com/costs-of-dec ... rp-2948621