1.      When you conduct the bookkeeping – By not Claiming meal receipts and not identifying it in a meal ledger such as a meal & ent,  meal travel, meal – living out allow, meal – isolated living, etc.
Canada Revenue Agency tax department believes a consumption of a meal is part personal.  Although for business expense the meal and the gst paid is 100% deductible by the company.  The Tax claim of the meal expense and the gst on the meal has to be reduced by 50% when prepared for tax purposes.

In unusual incidents a meal claim for an “isolated” work site, you may claim 100% of the meal expense and 100% of the GST expense.

2.      When you compile the bookkeeping  you can make the mistake by claiming receipts as a business expense that actually have some personal use by the employees or owners.  It is not uncommon to have to discuss lifestyle related expenses and determine if any part of the expense is business related.

Travel and vehicle are likely ledgers that may have some personal portion that may have to be deducted and or taxable to the employees or owners.

3.     Bookkeepers do not claim an equipment purchase as an operating cost.  The popular mistake bookkeepers do when they are inputting the computer purchase and categorizing it under office expense.  Because a computer provides more than one years use for the business as all equipment purchases, this expense must be claimed as an asset on the balance sheet rather than on the income and expense.

4.      Bookkeepers ensure that when you are Obtaining confirmation on the use of vehicle in the company;  specifically when claiming a vehicle with an over  $30,000 purchase cost you may be claiming to much GST and when the taxes are prepared the actual asset listing of that vehicle may have to be reduced in value to $30,000.  Although for business expense the vehicle and the gst paid is 100% deductible by the company.  The Tax claim of the vehicle purchase and the gst has to be reduced by the $30,000 threshold when prepared for tax purpose.  When a vehicle is used for a passenger vehicle, the amount eligible is restricted to $30,000 for tax purposes.

5.      Bookkeepers if you are not Collecting GST on every sale within a GST registered company, cause you suspect gst is not a consideration, doubt that belief, collect gst.    Selling a company used computer, used vehicle to any one, the owner or an employee is considered a taxable sale and gst is collectable.

Ensuring that your bookkeeping is in order for your small business client is important.  Ensuring that the bookkeeping is in order for the year end is important – however, ensure that checklist for your bookkeeping for the year end has included the observations for the tax deductions available to your small business client and their accountant.

Darlene Lafond R.P.A.

darlene@c2online.ca

Intellectual property theft is different than the theft of physical property. Instead, it involves stealing or misusing proprietary information a company (or person) owns. Examples of intellectual property include copyrights (which protect things such as written material, audio or video recordings, and even computer code), trademarks (which protect things like a company name, product name, logo, slogan, or package design), trade secrets (like a restaurant’s secret recipe), and patents (which protect inventions or discoveries, like the composition of a new medication).

Why is intellectual property important?

Intellectual property protection is critical to fostering innovation. Without protection of ideas, businesses would not reap the full benefits of their inventions and would focus less on research and development. Similarly, artists would not be fully compensated for their creations and cultural vitality would suffer as a result.

Why should I protect my intellectual property?

Piracy, counterfeiting and the theft of intellectual property assets pose a serious threat to all businesses. Exporters face unfair competition abroad, non-exporters face counterfeit imports at home and all businesses face legal, health and safety risks from the threat of counterfeit goods entering their supply chains.

What about those companies that are seeking your intellectual property by means of deception?

You are asked to ‘help’ and instead you are creating a database of knowledge for the competition to further their development without you even realizing what you are doing.

As a business owner I ask these questions and so should you:

1.     1.  If someone wants everything for free it must have value?

2.     2. When I provide free information what am I providing?

3.     3. Who am I providing this information too?

4.     4. What is their intent with this information?

Due diligence is required by ourselves to ensure that we know who we are doing business with and we are comfortable providing the information to that individual or company.  Next time your intellectual property is questioned make sure you ask yourself the above 4 questions and you have the answers.

According to FBI, Interpol, World Customs Organization and International Chamber of Commerce estimates, roughly 7-8% of world trade every year is in counterfeit goods. That is the equivalent of as much as $512 billion in global lost sales. Of that amount, U.S. companies lose between $200 billion and $250 billion. IP theft has a major impact at home, too: according to the U.S. Chamber of Commerce, overall intellectual property theft costs 750,000 U.S. jobs a year.

According to the Harvard Business Review – ‘the law is often not the best defense against the theft of intellectual property.  Far more effective in such cases are market-based strategies that keep pirates in port.’ Read their protection idea’s and suggestions.

Download here.

Lisa Patrick

Good bookkeeping leads to good business management and growth!

Ensure that the bookkeeper is not making the below 5 common mistakes:

1.      They do not account for claiming meal receipts and not identifying it in a meal ledger such as a meal & entertainment,  meal travel, meal – living out allow, meal – isolated living, etc.

The government tax department believes a consumption of a meal is part personal.  Although for business expense the meal and the gst paid is 100% deductible by the company.  The Tax claim of the meal expense and the gst on the meal has to be reduced by 50% when prepared for tax purposes.

In unusual incidents a meal claim for an “isolated” work site, you may claim 100% of the meal expense and 100% of the GST expense.

2.      Claim receipts as a business expense that actually have some personal use by the employees or owners.

It is not uncommon to have to discuss lifestyle related expenses and determine if any part of the expense is business related.

Travel and vehicle are likely ledgers that may have some personal portion that may have to be deducted and or taxable to the employees or owners.

3.      Claim an equipment purchase as an operating cost.

The popular mistake is inputting a computer purchase under office expense.  Because a computer provides more than one years use for the business as all equipment purchases, this expense must be claimed as an asset on the balance sheet rather than on the income and expense.

4.      Without Obtaining confirmation on the use of vehicle in the company,  specifically when claiming a vehicle with an over  $30,000 purchase cost you may be claiming to much GST and when the taxes are prepared the actual asset listing of that vehicle may have to be reduced in value to $30,000.  Although for business expense the vehicle and the gst paid is 100% deductible by the company.  The Tax claim of the vehicle purchase and the gst has to be reduced by the $30,000 threshold when prepared for tax purpose.  When a vehicle is used for a passenger vehicle, the amount eligible is restricted to $30,000 for tax purposes.

5.      Not Collecting GST on every sale within a GST registered company, cause you suspect gst is not a consideration, doubt that belief, collect gst.

Selling a company used computer, used vehicle to any one, the owner or an employee is considered a taxable sale and gst is collectable.

C2online specializes tools for business owners to ensure they maximize on their deductions.. go to our categories and feel free to browse .. if you have any questions just contact us!

Prepare each account (category)  total to each Business year end
(fiscal period example
First year:         March 9, 2009 to February 28, 2010
2nd year:            March 1, 2010 to February 28, 2011)
Or cut off date of company when closing
If you desire dissolving corporation or company, contact a registry office for the proper protocol.

Group receipts in each category as shown in
Canada Revenue Agency handout:
Business & Professional guide T4002E <http://www.cra-arc.gc.ca/E/pub/tg/t4002/README.html>
Go to section after page 30
Page 2of 5 Part 4
Income
Other costs may be where you would put any money you transferred to or from your personal account

Expenses
Page 2of 5 Part 5
Motor Vehicle Expenses
Page 5of 5 Chart A
Claim the expenses you believe to be business use 100% as one total
Claim the expenses you believe to be business use not 100% as another total…

If you are uncertain on the percentage of business use
For example:
Motor Vehicle
log the kilometer the vehicle travelled for the whole period
and then
provide the log of kilometers you used it for business.

Home space used for business office, storage and meetings.
Measure the space of the whole home up and down for square footage available
Measure the space of the whole home up and down for square footage used for business..
Some considerations to a room used some of the time for business and personal, you may need to complete a more complicated home space calculations.
We do have a form that is available at our website www.c2online.ca <http://www.c2online.ca/> for $4.95 or compare <http://www.c2online.ca/Store/tabid/80/ctl/ProductDetails/mid/595/ProductID/57/Default.aspx> for $7.95.
You need Microsoft excel.

Darlene Lafond C.P.C., R.P.A.

How? Implement a travel tax credit for money spent on flying or driving, hotels, campsites, etc. for personal travel.

Criteria? It has to have two trips to qualify, first $250.00 does not qualify, maximum $10, 000.00

Where on the T1 General Tax Return?  It would not take much to modify the Schedule 12.

Interested?? Contact us.

Lisa Patrick, CEO

We are hoping all programs for children examine the layout and modify the receipts they are providing to comply with the governments.  We have basically copied from their website and provided links on the receipts.

Please click on our Free product to assist you in your claim.

If any programs need us to come and present to their program directors for free, contact us …  all for the sake of tax savings….!!

Please at the very least – reply that you have received our information.

Let us know of the situation and maybe we might do it for free.  Our criteria for handling the tax court case is simple, we may learn from your case which will enable us to help you and help our tax clients at the same time.

Advise us of your situation by contacting us.

1. Full name or place
2. Reason for the visit ( We suggest attaching paper work copy of meeting if expense over $500)

When documenting, in our experience the first intent of a business purpose must be evident when the purpose is shared between business and personal.
VERY IMPORTANT: Keep your personal relationship to the person or place out of the details.  It was a business purpose, that is all that should beindicated on the documentation.

In a recent tax court case, the jusge was openingly perturbed at the fact that the meal reciepts indicated: “lunch with my daughter about the website.” This description indicated to him the purpose was personal first and business second.

We suggest that the description of the business luncheon should read: ‘Lunch with our website designer – Penny Joe…. Discussion: Graphics Improvements Needed’

Darlene Lafond R.P.A., C.P.C.