Archive for November, 2014

How to manage money when you are self employed Immigrant

Starting your own business can be costly, but so can mistakes when it comes to money and tax. Avoid the pitfalls by following this advice.

As yourself,  can I afford to set up a business?

You need to make sure that you calculate how much it is going to cost to start up and run your business to ensure that you have accurate figures in your business plan, especially if you’re applying for investment from third parties.

All costs need to be recorded for reporting to Canada Revenue ( even if you are a limited company or a certain type of partnership).

Here is a guide to costs you may incur when setting up your business:

Business planning,  Registrations, Permit and Licences
 Insurance ,  set up and location, employee, payroll and taxes

For more please check this link:
Information on planning, starting and growing your own business

Canada Revenue recommends that you keep the following records, which will help you to fill out your tax return:

invoices and receipts;
electronic sales records or till rolls;
mileage records;
bank statements;
P60s (if you are also employed);
payroll records (if you have employees);
rent books;
hire purchase records;
an inventory of stock on hand;
a record of money taken out of the business for personal use.
So what do I need to know now that I have to pay self-employment taxes every year?

Each year, depending on the number of people I provide my services to, I need to collect  finantial statements at the end of the year to file my taxes.  Learn about Federal and provincial taxes of the contracting world and in order to avoid an audit, you need to make sure  you report exactly what is on that form.

Now that you started the year as a contractor, you should probably pay quarterly taxes rather than wait until the end of the year. If you think it’s a good idea simply to pay a year’s worth of payroll, federal and provincial income taxes once a year, think again. The CR will levy a

severe underpayment penalty for holding on to its money the entire year. Payments are to be made April 15th, July 15th, October 15th and January 15th (The January payment will be in the following fiscal year).

Owning my own business,  you will be keeping your eyes and ears open for every possible deduction to minimize the new taxes that you now need to pay. Previously, the standard deduction was all that I needed but those days are well behind me.
Somehow, you need to realize that every check you receive for you work is not 100%  yours to keep. A good chunk of that belongs to the government, so in order not to spend everything I make, I’ve decided to set aside an online savings account specifically for payment of  CR taxes. Four times a year,  you will take money out of that account to pay my estimated taxes the other days of the year, that account does not exist!   Self-Employment taxes can certainly be a drag if you’re just getting started in a new business and have never heard of them before.

But when you’re 65 and reaping the benefits of social security (reaping may be exaggerated and that’s assuming there’s anything left that far in the future) you won’t be as upset that the CR made you pay it.

Business Immigration Ontario

Ontario is one of North America’s most dynamic places to do business. Entrepreneurs benefit from our strategic location, low taxes, competitive operating costs and a multicultural workforce that is well educated, highly skilled and productive.

If you are an entrepreneur ready to invest in and actively manage a business in the province, you may be eligible for the ON Provincial Nominee Program’s (PNP) Business Immigration stream. This stream accelerates the permanent residence application process for individuals who can establish themselves in ON. and develop a business that will provide significant economic benefits to the province. To qualify, you must meet specific personal net worth thresholds, make a minimum investment in an eligible business, be actively involved in the daily management of the business, and create one or more new jobs for Canadian citizens or permanent residents. Please note that meeting the minimum eligibility requirements does not guarantee approval.

The Business Immigration application process has two phases:
In phase one, you sign a performance agreement and are initially supported for a two-year work permit.
In phase two, you arrive in ON. on the work permit, establish and actively manage your business, and complete the investment and job-creation requirements.
Applicants are nominated by the ON PNP for Permanent Residence in Canada only when they satisfy the terms of their performance agreement.

You can apply to the PNP as a business immigrant in one of three categories as described below. Each category has specific requirements.

The Entrepreneur category is the best choice if:
You would like to start or purchase and expand a business anywhere in ON.
You have a personal net worth of at least $800,000.
You intend to invest at least $400,000 in (and acquire at least one-third equity ownership of) the business.
You can commit to creating at least three new jobs for Canadian citizens or permanent residents.
You would like to propose one key staff member on your application.
The Regional Entrepreneur category is the best choice if:
You would like to start or purchase and expand a business outside of the Vancouver and Abbotsford metropolitan areas.
You have a personal net worth of at least $400,000.
You intend to invest at least $200,000 in (and acquire at least one-third equity ownership of) the business.
You can commit to creating at least one new job for a Canadian citizen or permanent resident.
The Strategic Projects category is the best choice if:
Your company is interested in setting up a ON-based operation (such as a branch office or subsidiary) anywhere in the province.
Your company intends to make an equity investment of at least $500,000 in the business.
You would like to propose up to five key staff members on the application and you can commit to create at least three new jobs for each key staff member.
The Regional Business Succession Option is a good choice if you intend to purchase and manage an existing ON. business. This option applies to all business immigration categories where the business is located outside of the GTA Toronto and out of the metropolitan areas. This category offers priority processing and includes reduced job creation requirements.

Farming Businesses Only
Applications proposing agricultural activities must include a feasibility assessment of the proposed business prepared by a consultant from the List of Eligible Consultants approved by the Ministry of Agriculture under its ON Farm Business Advisory Services Program.

Read more about the criteria required to apply under these categories.

You may wish to explore other options for immigrating to Canada. Visit Citizenship and Immigration Canada’s website to read about federal business immigration options.