Good Compliance Habits for Small Business
Getting all your ducks in a row doesn't have to be a chore. Done right, it's almost like breathing ... you aren't even aware you are doing it.
Check out the latest articles below.
Small Daily Habits Can Move Mountains
Do just one task today towards meeting your tax compliance obligations. Just one.
Make this the year you incorporate self-care into your daily routine so you are around for your family!
- Establish clear work boundaries and follow them by outlining your availability and response times to alleviate any confusion. You deserve one full day off a week to recharge your batteries, maybe even two days in a row.
- Remember every once in a while to stop, stretch, and JUST BREATHE!
- Think about reinstating recess this year if you work indoors. Get outside for 15 minutes to let natural light energize you.
- Eat breakfast. Don't have time? Try out Dr. Will's fast, easy, and healthy breakfast smoothie.
- Stay hydrated by drinking water to stave off fatigue and concentration issues.
- Schedule exercise time three times a week (maybe try a HIIT routine; they are quick and effective).
- Reach for progress not perfection with your business work habits as well as with your diet routine by making choices that are just a little bit better based on where you are now.
- Striving for thirty (30) plant points a week makes improving your diet easy. Incorporate a variety of plant based foods (nuts, seeds, oils, whole grains, legumes, beans, fruits, and vegetables) into your existing eating habits to have a healthier gut biome. You'll feel better which means you'll get more done with less effort.
Enjoy Your Visit! Laura
Jun 13, 2025
Employee Taxable Benefits | An Intro To Payroll Deductions in Canada
An introduction to employee taxable benefits in Canada. Information on cash and non-cash gifts and awards, vehicle benefit calculator, disability insurance ...
Continue reading "Employee Taxable Benefits | An Intro To Payroll Deductions in Canada"
Jun 07, 2025
Third Quarter CRA Prescribed Interest Rates
Prescribed interest rates are released quarterly by the CRA. They are used to calculate the amount to charge on taxable benefits such as interest-free and low-interest rate loans for shareholders, spouses, and employees.
The rate in effect for the quarter commencing July 1, 2025 is 3%.
Continue reading "Third Quarter CRA Prescribed Interest Rates"
May 27, 2025
Simple Cash Management System | Self-Employed Canadian
Cash is what keeps your business going. This simple cash management system gives you a clear picture of your cash position at the start of each day.
Continue reading "Simple Cash Management System | Self-Employed Canadian"
May 24, 2025
Safe And Simple Payment Methods | Canadian Solopreneurs
Use safe and simple payment methods to send and receive online payments in Canada. How do Canada's digital banking processes work?
Continue reading "Safe And Simple Payment Methods | Canadian Solopreneurs"
May 19, 2025
Solopreneur Two-Bank Strategy | Combine Traditional & Online Banking
The smart business guide to a solopreneur two-bank strategy. Learn how to combine traditional and online banking for maximum business benefits.
Continue reading "Solopreneur Two-Bank Strategy | Combine Traditional & Online Banking "
Apr 16, 2025
Canadian Prescribed Interest Rates | Shareholder Loans
Quarterly prescribed interest rates issued by CRA for overdue & overpaid taxes and taxable benefits. Spousal interest payments are due annually by January 30th.
Continue reading "Canadian Prescribed Interest Rates | Shareholder Loans"
Mar 23, 2025
Upcoming Change To The Capital Gains Inclusion Rates
Finance Minister LeBlanc announced the implementation of changes to the capital gains inclusion rate will be deferred from June 25, 2024, to January 1, 2026.
Continue reading "Upcoming Change To The Capital Gains Inclusion Rates"
Feb 25, 2025
Payroll Compliance and Reporting | Manual For Less Than 10 Employees
Simplifying payroll compliance for a Canadian small business (under 10 employees). Part 2 covers keeping CRA happy, non-employees, and employer obligations.
Continue reading "Payroll Compliance and Reporting | Manual For Less Than 10 Employees"
Feb 25, 2025
Setting Up and Processing Payroll | Manual For Less Than 10 Employees
Learn payroll setup and processing for Canadian small businesses with less than 10 employees. Part 1 covers the payroll cycle, common mistakes and good habits.
Continue reading "Setting Up and Processing Payroll | Manual For Less Than 10 Employees"
Feb 25, 2025
Canadian Payroll Manual | Getting It Right for Small Business
A Canadian payroll manual for small business owners doing their own payroll. Learn to process payroll, handle deductions, and stay compliant with CRA rules.
Continue reading "Canadian Payroll Manual | Getting It Right for Small Business"
Feb 23, 2025
Year-End and Tax Preparation | Simple Tax Compliance Method
If you keep your books solely for year-end and tax preparation purposes, tax experts suggest you establish this simple method to meet this requirement.
Continue reading "Year-End and Tax Preparation | Simple Tax Compliance Method"
Feb 23, 2025
CRA Extends 2025 T4 Deadline
CRA announced on February 19, 2025 that "Given ongoing challenges faced by some filers, the Canada Revenue Agency (CRA) will grant relief in respect of late-filing penalties for information returns filed on or before March 7, 2025, for those information returns normally due on February 28, 2025."
The "ongoing challenges faced by some filers" related to either WebForms or tax filing software having trouble filing the T4 slips. Some issues on WebForms were around validations for EI exempt taxpayers as well as other issues.
A reminder that the CRA introduced new electronic filing thresholds. Effective January 2025, CRA made changes to the T619 electronic transmittal form. Part of this change requires submitting only one type of information return per file. For example, you will no longer be able to submit T4s and T4As in the same file. They must be sent in separate files.
In addition, since January 2024, paper filing of information forms such as the T4 is only available if you have less than 6 slips.
Feb 19, 2025
T4 Slip Boxes 24 and 26 | Difference Between Paid vs Earned Income
Common questions about T4 slip boxes 24 and 26. What an employee can do if they don't receive their slip on time. A tip for BEFORE you prepare your T4 slips.
Continue reading "T4 Slip Boxes 24 and 26 | Difference Between Paid vs Earned Income"
Feb 14, 2025
RRSP Tips and Traps | Small Business Owners
RRSPs can be a valuable tool for small business owners in Canada to save for retirement. Some RRSP tips and traps to keep in mind to maximize their benefits.
Continue reading "RRSP Tips and Traps | Small Business Owners"
Feb 12, 2025
Current Payroll Tax Rates | What Your Employee Really Costs You
Meet your payroll compliance obligations. 2025 payroll tax rates - EI premium rates were released Sep 2024. CPP contribution rates were released Nov 2024.
Continue reading "Current Payroll Tax Rates | What Your Employee Really Costs You"
Feb 09, 2025
Hiring and Paying Your First Employee | CRA Employment Status Tests
Hiring and paying your first employee in Canada: Step-by-step instruction from registration to running your first payroll, because you just want to do it right.
Continue reading "Hiring and Paying Your First Employee | CRA Employment Status Tests"
Feb 02, 2025
CRA SimpleFile Service
CRA SimpleFile service is a streamlined service to make the process of filing tax returns easier for Canadian taxpayers. It opens Feb 24/2025 for 2024 tax year.
Jan 31, 2025
Changes to Capital Gains Inclusion Deferred to 2026
The Canadian government announced today that they will be delaying the implementation of changes to the capital gains inclusion rate. Finance Minister Dominic LeBlanc is moving the effective date from June 25, 2024, to January 1, 2026.
The change will increase the inclusion rate from one-half to two-thirds on capital gains above $250,000 for individuals and all capital gains for corporations and trusts.
The government is maintaining several exemptions and introducing new measures, including:
(1) keeping the Principal Residence Exemption;
(2) creating a new $250,000 Annual Threshold effective January 2026;
(3) increasing the Lifetime Capital Gains Exemption to $1.25 million effective June 25, 2024; and
(4) introducing a new Canadian Entrepreneurs' Incentive that reduces the inclusion rate to one-third on eligible capital gains up to $2 million, effective for the 2025 tax year.
Continue reading "Changes to Capital Gains Inclusion Deferred to 2026"
Jan 22, 2025
Understanding Your Investment Tax Slips | T3 T5 T5008
A quick guide to understanding your investment tax slips. What's the difference between a T3 and T5 slip? A T5 and T5008? Who declares a dividend before payout?
Continue reading "Understanding Your Investment Tax Slips | T3 T5 T5008"
Jan 22, 2025
CRA Non-Business Travel Rates for Canadians
CRA's simplified method for non-business travel can be used for trips relating to medical expenses, moving expenses, and the northern residents deduction.
Continue reading "CRA Non-Business Travel Rates for Canadians"
Jan 11, 2025
Online Platforms Required to Share Gig Workers' Income with CRA
Gig workers need to be careful when reporting their income.
Bill C-47 that requires online digital platforms to share gig workers' income with the CRA went into effect January 1, 2024. This affects services like DoorDash, Skip the Dishes, Lyft, and Uber.
The legislation requires the platforms to share their information by January 31 every year. While it doesn't change the rules for how you report your income, it does change how the CRA reconciles income reported on your tax returns.
The information sharing occurs if there are more than thirty logged activities online and if the gig worker made more than $2,800 during the year on the platform.
As a gig worker, you should receive a copy of any information provided to the CRA by your online platform.
This is a positive change for gig workers who were not reporting the income. They can now contribute to CPP and EI. The income also goes toward their RRSP contribution limit. This ability positively affects gig workers futures financial stability.
Source: Toronto Star December 26, 2024 Gig tax target: Starting in January, platforms like Uber and DoorDash need to report driver income to Revenue Canada; Doane Grant Thornton June 23, 2023 What does Bill C-47 mean for you or your business?
Continue reading "Online Platforms Required to Share Gig Workers' Income with CRA"
Jan 06, 2025
What Prorogation of Parliament Means For The Capital Gains Legislation
Updated January 31, 2025
This change has been deferred to 2026 by Finance Minister Dominic LeBlanc. Read the January 31, 2025 blog post for me information.
January 6, 2025
Today, Parliament was prorogued. This means all legislation before parliament dies until the next session begins.
While the current government remains in power during the prorogation period, this effectively kills the proposed increase of the capital gains tax rate from 50% to 66.67% that was to be effective as of June 25, 2024.
Updated January 10, 2025
What to do when preparing your 2024 tax return?
Do you assume the proposed legislation is killed permanently and apply 50% to capital gains or do you assume it will ultimately pass and apply the 66.67% where applicable?
"The CRA will be issuing the forms needed to allow taxpayers to file in accordance with the new capital gains rules by Jan. 31, 2025. Arrears interest and penalty relief, if applicable, will be provided for those corporations and trusts impacted by these changes that have a filing due date on or before March 3, 2025.
Finance also confirmed that even if Parliament is prorogued, or ultimately dissolved, the CRA will “generally continue to administer proposed legislation consistent with its established guidelines.” That being said, when Parliament does resume, if no bill is introduced and passed in the House of Commons, and the government signals its intent to not proceed with the proposed capital gains tax, the CRA would cease to administer it."
So two options: (1) pay the tax if you feel the legislation will eventually pass (CRA tax refund rate is currently 6%); or (2) pay the tax at the legal rate until it is known if the passes or not (CRA overdue tax rate is currently 8%)
Sources: CRA January 8, 2025 Businesses: Here are the top changes that will affect business taxes in 2025 - The CRA is administering proposed capital gains inclusion rate legislation; Financial Post January 9, 2025 How to handle the uncertainty about capital gains in tax filing this year
Other related posts:
- November 27, 2024 CRA Updated Guidance - 2024 Capital Gains Relief
- June 13, 2024 Capital Gains Inclusion Rates Upcoming Change
Continue reading "What Prorogation of Parliament Means For The Capital Gains Legislation"
Jan 03, 2025
Don't Forget To Record Your Odometer At Year-end
At the beginning of each year (January 1), you need to record your odometer reading. This figure becomes the last entry for your prior year log. It's a good idea to diarize this date so you don't forget.
Continue reading "Don't Forget To Record Your Odometer At Year-end"
Jan 01, 2025
Company Owned Vehicles | Canadian Taxable Benefits
Should employees have a company owned vehicle? What are the compliance implications for the employer? What are the personal tax implications for the employee?
Continue reading "Company Owned Vehicles | Canadian Taxable Benefits"
Jan 01, 2025
How To Write-off Business Vehicle Expenses | Self Employed in Canada
Business vehicle expenses for self-employed sole proprietors are claimed on tax form T2125. If you use your personal vehicle for business, let's see how ...
Continue reading "How To Write-off Business Vehicle Expenses | Self Employed in Canada"
Dec 31, 2024
2025 Automobile Deduction Limits and Expense Benefit Rates
The Department of Finance Canada released the 2025 automobile income tax deduction limits and expense benefit rates.
Limits released were as follows:
- The 2025 employee tax free auto allowance will increase by 2 cents per kilometre.
- CCA ceiling for class 10.1 vehicles increased by $1000 while Class 54 vehicles remained the same as 2024.
- The deductible leasing costs increased $50.
- The maximum interest deductible allowed for new auto loans remained the same as 2024.
- Employee taxable benefit rate increased one cent as did the self-employed taxable benefit rate.
I've updated the rate tables for the new 2025 automobile deduction limits and expense benefit rates.
Continue reading "2025 Automobile Deduction Limits and Expense Benefit Rates"
Dec 31, 2024
Is an Auto Allowance a Taxable Benefit? Tax Exempt?
When is an auto allowance a taxable benefit and when is it tax exempt? Are there other vehicle deduction limits I need to be aware of?
Continue reading "Is an Auto Allowance a Taxable Benefit? Tax Exempt? "
Dec 18, 2024
CRA Automatic Tax Filing
Update: January 31, 2025
CRA announced that automatic tax filing starts February 24th. Invitations letters will be sent out. There are 2 filing options available: by phone or digitally. Your invitation will outline which service you will be using.
Filing does not involve speaking with a CRA agent. There are no calculations to make. It will take 10 minutes or less by phone and up to 20 minutes by computer or mobile device.
Learn more at:
canada.ca/en/revenue-agency/news/newsroom/tax-tips/tax-tips-2025/simplefile-let-us-help-you-with-taxes.html
December 18, 2025
On Monday, the government released their fall economic statement. One of the items was going ahead with "making automatic tax filing a reality".
SimpleFile service was made available in February 2024. Those who met the qualifications for the service received an invitation to file by phone, by mail, or online.
For 2025, if legislation is passed, it is planned that some lower-income Canadians tax returns will be filed automatically on their behalf by CRA.
Automatically filing returns is also being considered for modest middle class Canadians that have "gaps" in their filing history or are non-filers ; as well as developing free tax software for simple returns
Dec 14, 2024
9 Most Popular Blogs Of 2024
9 Most Popular Blogs Of 2024. Tax Compliance for Small Business . CRA Subcontracting Reporting Requirements . Self Employed Tax Deductions . T4 & T4A Slips
Nov 30, 2024
Are you ready for your CRA mail to go online?
On November 14, 2024, CRA announced it will be transitioning to online mail as the default method of delivering correspondence. This change applies to all:
- New business number and program account registrations
- Existing businesses registered for 'My Business Account'
- Businesses who have a representative that accesses the CRA’s services via 'Represent a Client'
What you need to do:
Sign into CRA's portal 'My Business Account' or 'Represent a Client' and make sure your email address is correct.
Exceptions:
Existing business, charities and non-resident businesses that are not registered for or do not have access to 'My Business Account' will continue to receive their mail by snail mail.
Requesting paper mail:
After April 2024, you will have to request paper mail by selecting paper mail as your delivery method for correspondence in 'My Business Account' or completing and mail form RC681 - Request to Active Paper Mail for Business.
Continue reading "Are you ready for your CRA mail to go online?"
Nov 27, 2024
CRA Updated Guidance - 2024 Capital Gains Relief
Editor: See January 31, 2025 update (Changes to Capital Gains Inclusion Deferred to 2026)
The legislation to enact the proposed 66.7% capital gains inclusion rate effective June 25, 2024 is held up in Parliament due to the filibuster launched by the Conservatives. It has not been introduced as a bill yet.
As a result, tax returns cannot be filed because the tax software isn't available yet. Tax software can only be released once CRA certifies their tax forms. CRA can't release updated tax forms until the legislation is passed. It's a mess.
The CRA has posted 2024 guidance on their webpage 'T4037 Capital Gains 2023' that they will be proceeding based on the Notice of Ways and Means Motion that has been filed.
"For all taxpayers, the new inclusion rate will apply to capital gains realized on or after June 25, 2024. Impacted forms for individuals, trusts and corporations are expected to be on Canada.ca as of January 31, 2025. Arrears interest and penalty relief, if applicable, will be provided for those corporations and trusts impacted by these changes that have a filing due date on or before March 3, 2025. The interest relief will expire on March 3rd. More information will be forthcoming in the coming weeks."
A Globe and Mail November 27, 2024 article by Rudy Mezzetta titled 'Despite interest and penalty relief, questions abound for corporations navigating capital gains changes' puts forth three filing options:
1. File and pay taxes based on the current 50% inclusion rate;
2. Manually adjust the existing forms and pay taxes using the 66.7% inclusion rate;
3. File using the current forms but calculate and pay taxes based on the higher rate.
The CRA will be administering the proposed capital gains inclusion rate while awaiting parliamentary approval. This is a standard practice.
Nov 21, 2024
GST Holiday Dec. 14 to Feb. 15
The government announced today that it will be introducing legislation in Parliament that would provide for a two-month Goods and Services Tax/Harmonized Sales Tax (GST/HST) break for groceries and holiday essentials.
It will be a hardship for small businesses with changing the sales tax rates twice in a short time frame. The administration for this 'holiday' will likely be very expensive for most small retailers.
(Update: It passed legislation on November 28th.)
This new temporary tax break will apply to:
- Prepared foods, including vegetable trays, pre-made meals and salads, and sandwiches.
- Restaurant meals, whether dine-in, takeout, or delivery.
- Snacks, including chips, candy, and granola bars.
- Beer, wine, cider, and pre-mixed alcoholic beverages below 7 per cent ABV.
- Children’s clothing and footwear, car seats, and diapers.
- Children’s toys, such as board games, dolls, and video game consoles.
- Books, print newspapers, and puzzles for all ages.
- Christmas trees.
Source: Prime Minister of Canada website, November 20, 2024 More money in your pocket: A tax break for all Canadians and the Working Canadians Rebate
Nov 21, 2024
The Working Canadians Rebate
The government announced today that it will be introducing legislation in Parliament that would provide for the delivery of a new $250 Working Canadians Rebate.
(Update: The Liberals did not get the support they needed as a minority government to move forward with this legislation.)
Canadians who worked in 2023 and earned up to $150,000 will see a $250 cheque in their bank account or mailbox, starting early spring 2025. To be eligible for the rebate, you must have filed a 2023 income tax return.
Source: Department of Finance Canada, November 20, 2024 More money in your pocket: The Working Canadians Rebate
Nov 21, 2024
First Quarter 2025 CRA Prescribed Interest Rates
Prescribed interest rates are released quarterly by the CRA. They are used to calculate the amount to charge on taxable benefits such as interest-free and low-interest rate loans for shareholders, spouses, and employees.
The rate in effect for the quarter commencing January 1, 2025 will be 4% based on the three month TBills sold at auction in October.
Did you know that the base rate is determined quarterly using the simple average of three-month Treasury bills for the first month of the preceding quarter rounded up to the next highest whole percentage point (if not already a whole number)?
Did you know that the overpaid taxes rate (amounts owing from the federal government) is always 2% points more than the taxable benefits rate?
Did you know that overdue taxes rate (basically the rate for all other purposes) is 4% points more than the taxable benefits rate?
Continue reading "First Quarter 2025 CRA Prescribed Interest Rates"
Nov 21, 2024
CRA and the Underground Economy | Cash Under The Table
Dealing in cash thrives in the underground economy. Here's what to do when your customer wants to do "cash under the table". Legal tax planning tools are dis...
Continue reading "CRA and the Underground Economy | Cash Under The Table"
Nov 21, 2024
2025 CRA Annual Indexation Adjustments Released
Last week, CRA released the indexation adjustment for personal income tax and benefit amounts. The 2025 indexation increase is 2.7% down from 4.7% in 2024.
The tax and non-refundable tax credits take effect on January 1 annually. Most benefits are effective July 1, 2025 as they are tied to the filing of your prior year return.
Continue reading "2025 CRA Annual Indexation Adjustments Released"
Nov 16, 2024
When Should You Incorporate As A CCPC In Canada?
You operate a business as a sole proprietor or a partnership. Is it the right time to incorporate your business as a CCPC?
Continue reading "When Should You Incorporate As A CCPC In Canada?"
Nov 16, 2024
What is the Lifetime Capital Gains Exemption (LCGE)?
The Lifetime Capital Gains Exemption (LCGE) is a provision in the Canadian tax system that allows individuals to realize tax-free capital gains up to a certain limit on the sale of qualifying properties. This exemption is designed to encourage investment in small businesses, farming, and fishing by offering tax relief on gains from these investments. I explore the key details of the LCGE.
Continue reading "What is the Lifetime Capital Gains Exemption (LCGE)?"
Nov 13, 2024
2025 CPP Maximum Pensionable Earnings and Contributions Released
The 2025 maximum pensionable earnings and contributions were released by the Canada Revenue Agency on November 1, 2024.
The CRA news release stated, "In 2024, a second earnings ceiling was introduced, the Year’s Additional Maximum Pensionable Earnings (YAMPE). The YAMPE is used to determine second additional Canada Pension Plan contributions (CPP2). In 2024, the YAMPE is approximately 7% above the Year’s Maximum Pensionable Earnings (YMPE). In 2025 and every year after, the YAMPE will be approximately 14% above the YMPE."
Reference: News Release: November 1, 2024 Canada Revenue Agency announces maximum pensionable earnings and contributions for 2025
Continue reading "2025 CPP Maximum Pensionable Earnings and Contributions Released"
Oct 27, 2024
Tax Compliance for Small Business | Canadian Filing Deadlines
Tax compliance filing deadlines for small business owners - GST HST returns, payroll remittances, income tax returns and instalment payments, subcontractors
Continue reading "Tax Compliance for Small Business | Canadian Filing Deadlines"
Oct 03, 2024
Provincial Sales Tax Rates in BC | BC PST Rates
Explore Provincial Sales Tax Rates in BC and more - current rates, exemptions, refunds, comparisons with other provinces, and its impact on goods, online sales.
Continue reading "Provincial Sales Tax Rates in BC | BC PST Rates"
Sep 23, 2024
Fourth Quarter CRA Prescribed Interest Rates
Prescribed interest rates are released quarterly by the CRA. They are used to calculate the amount to charge on taxable benefits such as interest-free and low-interest rate loans for shareholders, spouses, and employees.
The rate in effect for the quarter commencing October 1, 2024 is 5%.
Continue reading "Fourth Quarter CRA Prescribed Interest Rates"
Sep 19, 2024
How To Pay Employees With Cash | Casual Employment
Learn how to pay employees with cash properly to protect your business while accommodating the employee. CRA has a strict definition of casual employment.
Continue reading "How To Pay Employees With Cash | Casual Employment"
Sep 19, 2024
2025 EI Insurable Earnings Released
The 2025 EI rates including the maximum earnings that premiums can be deducted on were released by the Canada Employment Insurance Commission on September 13th.
"Each year, the Commission is responsible for setting the annual premium rate based on a seven-year break-even rate forecast by the EI Senior Actuary. The rate is set in order to generate just enough premium revenue to cover EI expenses over the next seven years and eliminate any cumulative surplus or deficit in the EI Operating Account. Annual changes to the premium rate are subject to a legislated limit of five cents."
The mandated 7 year break even objective has resulted in changes to 2025 rates. I've updated the Employment Insurance rates table.
Reference: News Release: Canada Employment Insurance Commission confirms 2025 Employment Insurance premium rate
Jul 27, 2024
CRA Subcontracting Reporting Requirements | T5018 vs T4A
What are CRA subcontracting reporting requirements? Do you use slip T5018 or slip T4A? T1 line 10400 vs line 13500? Where do you code subcontractors expenses?
Continue reading "CRA Subcontracting Reporting Requirements | T5018 vs T4A"
Jul 24, 2024
Canadian Employment and Labour Standards | Minimum Wage Rates
The laws, exemptions to the wage and other labor law issues are provincially and territorially regulated by employment and labour standards. Here's a summary.
Continue reading "Canadian Employment and Labour Standards | Minimum Wage Rates"
Jul 22, 2024
POE For Remote Workers | Province of Employment Determination
How to determine the province of employment - POE for remote workers with examples. New guidelines are effective January 1, 2024.
Continue reading "POE For Remote Workers | Province of Employment Determination"