What Prompts a Tax Audit?

For some, it is their greatest fear, for others, a fact of life. The letter from CRA saying they want to review your tax returns.

There are only 2 ways that a taxpayer can be selected for an audit:

Random Change
Targeted Selection Process

We’ll ignore random chance and give you the details for the Targeted Selection Process (TSP).

The TSP is based upon risk factors; the CRA looks for those that are more likely to owe more taxes based upon some specific criteria and experience:

10% of randomly selected taxpayers face an additional tax bill of more than $5,000 while 35% of TSP taxpayers owe more than $5,000 in additional taxes.

Common Business Killers

It is common knowledge that 85% of new business start ups fail within their first 5 years; 90% within the first 10 years. There are a number of ‘common business killers’, when overlooked, these items may lead to the demise of your business:

Lack of Planning: Every new business owner tends to react to each situation or set of circumstances as they arise, without the advantage of a plan, the business owner will jump from crisis to crisis without control or consistency, causing undue stress and teaching employees to operate in the same reactionary form.

A plan should be designed to increase the chances of success, while reducing the likelihood of failure. The plan should take into account the ‘what if’ scenarios and indicate a response to the problem and an efficient and reasonable solution, essentially indicating the competitive advantage of the business thorough differentiation and values.

Allowable Business Expenses

One of the first questions asked by a new business owner is “What can I claim as business expenses?”

Under the Income Tax Act, there is no true definition of what constitutes an allowable deduction against business or professional income. Essentially, any expense incurred directly related to the operation of your business or in direct relation to earning professional income is an allowable deduction. It would be impossible to list every deduction allowed in computing business income, because in theory, any expense incurred for the purpose of earning income is deductible. There are certain restrictions and exceptions to this guideline.

Ledgers (Coquiltam) Presents at Chamber of Commerce Luncheon

Lea Latham, Ledgers (Coquitlam) along with Matthew Bennett of Intuit made a presentation on the benefits and features of QuickBooks Online for members and guests of the Coquitlam Chamber of Commerce yesterday. Lea says “it went very well and I believe I got several client leads from it, Both Matt & I were very pleased with it.”

Tags: Coquiltam, Intuit, QuickBooks Online

: 30 May 2017

(Originally posted on July 24, 2015)

Ledgers (Cape Breton) Featured in Cape Breton Post

Ledgers (Cape Breton) and Merrill Carmichael were featured today in a great article in the Cape Breton Post; this article was written in response to our 3 events recently hosted in the Sydney NS area.

Read the Article Here

Tags: Cape Breton

Fabulous Grand Opening in Sydney, NS

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