Small Business Deduction May Be Limited

Under the Income Tax Act of Canada, small business Corporations must share the Small Business Deduction if they are either Associated (these are known as the Association Rules), or if not Associated, a corporation receives income from another Corporation in which it or a shareholder of that corporation, owns shares of that payor corporation (these […]

Independent Contractor or Employee?

In times of outsourcing, downsizing and economic cutbacks, it may be advantageous for a company to hire individuals as independent contractors to perform some of the functions that are being performed by that company’s employees. However, simply calling someone an independent contractor does not make it so. CRA will look behind the title of an […]

Automobile Reimbursements – More Tax Free Money!

Besides the possibility of a tax-free allowance, another possibility exits to reimburse employees or shareholders for business use of personally owned or leased vehicles. If the employer is flexible and it appears that the CRA prescribed automobile tax-free allowance rate is not adequate to cover actual operating costs incurred by the individual, taxpayers can argue […]

Automobile Allowances – Tax Free Money!

Personally owned vehicles used for business travel can offer a great way to earn tax free money while getting a business deduction. CRA specifies a specific allowance rate a business can pay the individual. The CRA prescribed allowance is a business deduction to the business and a tax-free receipt to the individual. The allowance rate […]