For individuals who own their own small businesses, it is extremely common to pay more for taxes than is necessary. At Leskun & Son Accounting, it is our goal to assist our clients in making the most out of their money, which is why we always want to ensure that they are aware of different ways to reduce small business tax bills. We offer a variety of tax services and solutions that are tailored to suit your individual needs.
Tips to Save on Taxes for Small Businesses
There are a variety of ways that you can save on taxes for your small business and keep more of your money in your pocket at the end of the year. Some tips for business owners to save on taxes include:
Contribute to an RRSP
Make sure that you budget to set aside money every year for the future in RRSP, or registered retirement savings plan. The amount that you can deposit annually will depend on your tax bracket. Speak to an accountant about how to best manage this type of account, and how to make the most of them.
Collect All Receipts and Invoices Related to Business
Always collect and keep all yearly records for spending and billing related to your business. Whether it is for a business lunch, travel expenses, or inventory, all of these expenses are deductible and can save you money on taxes when properly recorded.
Give to Registered Charities
When you give to a registered Canadian charitable organization, you earn tax credits. The more you give, the more tax credit you receive. Make sure that the charity of your choice is registered with the Canadian government, or else these tax credits will not kick in.
Run Your Business from Home
When you operate your business out of your home, you can get a number of tax deductions on your income. Many of your home’s expenses (which you would be paying for anyway) can be deducted and you can also deduct portions of your property tax.
Strategize with Your Capital Cost Allowance Claim
CCA are elective claims that can help you reduce your overall income tax bill, and there are strategies you can implement in order to maximize the benefits, now and in the future. For instance, you may want to withhold CCA on an appreciating asset in order to reduce the tax on CCA recapture upon sale. Make sure to speak with an accountant about how to make the most of your claims.
To find out more ways to reduce small business tax bills, or to get started with any of our financial services for self-employed individuals and business owners, please contact Leskun & Son Accounting at 1-877-826-1219 or fill out a contact form on our website.