It was Daniel Defoe who first wrote:
“Things as certain as death and taxes, can be more firmly believed.”
Fortunately, this week’s Loans 101 video, featuring Head of Underwriting Dominik St-Denis, shows that the arrival of tax time, or the collection of back taxes owed by businesses, need not be a crippling blow to your day-to-day cash flow. Merchant Advance funding works well in the short term to buffer against the repayment of owed taxes, no matter when or how much you find yourself needing to pay back.
Here are some of our favourite small business tax tips as the end of 2015 approaches:
- If your business is set up as a sole proprietorship or partnership and is making a solid income RRSPs are an excellent way to reduce your taxes and save for your retirement. In any given year, you can contribute up to 18 percent of your earned income
- Any income your business receives in January rather than December will reduce your business income for this year – thereby reducing the tax on your income. Delaying or deferring income makes especially sound tax sense when your business income is higher than usual, or when the tax rates in the coming year are going to be lower.
- Rather than scrambling to find missing receipts at the last minute, consider using financial management software that lives in the cloud or on a digital platform. This will make filing easier and more centralized when it comes time to find last-minute deductions.
- Small businesses should also be alert to special research and development tax credits that might apply to their line of work. For instance, businesses involved in the manufacturing, food or high-tech industries, among others, might be entitled to scientific research and experimental development (SR&ED) tax credits available federally, and also in some provinces or territories