“I like to pay taxes. With them I buy civilization.”
—Oliver Wendell Holmes, Jr.
Taxes Are A Fact Of Business Life
Everyone’s heard about the two inevitable and unavoidable things in life — death, and taxes. So while you’re keeping busy at staying alive, don’t neglect the taxman, because it’s guaranteed he won’t forget you. Doing taxes, especially for a small business or as a self-employed entrepreneur, can be onerous and there are a lot of tricks of the trade, so the best advice is to get yourself a “tax guru” who knows everything there is to know. Meet with them to set up a system — ideally way before tax time when they’re busy and you’re stressed out over the deadline — and follow it to the best of your ability.
You need to deal with GST, income tax, and perhaps other deductions. If you are working from home, there are certain parts of your overhead that may be deductible. If you use your vehicle for work, you need to track mileage and fuel and repair costs regularly. Receipts (and the organizing of them) are important. There are a lot of details worth knowing, and a good tax advisor can make your bookwork and organization relatively pain free. If you’re completely hopeless at bookwork and show up with a cardboard shoebox packed full of papers, they can probably fix that too — just expect to pay a bit more for the extra service.
Tax advisors can also help counsel you on your investments and savings, as well as give advice on RRSP’s. There are high- and low-interest savings accounts. Savings are an important part of business, and a really good habit to get into.
The best thing about having a tax advisor or accountant is that second-person perspective they give to your business, at arm’s length. The person spending your money shouldn’t be the person counting your money.