Welcome Guest!Register Login Contact Us Site Map FAQ

Home

Charcha

Select section:

Question for person on Payroll and Incorporated business

Jump to Page:
< Previous [ 1 ] [ 2 ] Next >

tamilkuravan
Member since: Jun 05

Posts: 5775
Location: God's own country
Post ID: #PID

Posted on: 03-02-08 23:03:34

Guys,
I am currently on Payroll in my company. I also have an incorporated company in my name (I did not register for GST Credit since I expected to earn not more than $15,000 a year).
My T4 for the year 2007 is $ 25K ($13 an hour).
I also did some private work for a collegue and he paid me around $ 9,600 for the whole of 2007 in the name of my company- nearly monthly payments (for which I used my SIN number).
Now, When I file for taxes, how do I file it.
When I file my individual taxes do I declare 25K as my income and then file my incorporated taxes for $9.6K (after deducting my expenses on that)? Will the govt. match SIN numbers and themselves come to a conclusion that 34.6K was my income and deduct the appropriate taxes based on that amount?
Could some one in similar situation shed light as to how they paid their taxes?
Also this year, I am expected to get more than 15K from my colleuge for contracted works to be done to him. So Should I register for GST credits or not?
Thanks in advance to your answers.
TK A

-----------------------------------------------------------------
I am a Gents and not a Ladies.

dp_jain
Member since: Jan 04

Posts: 418
Location: Brampton
Post ID: #PID

Posted on: 04-02-08 22:00:22

If the payment was made in the name of incorporated business then it is corporation revenue. The corporation will pay taxes on net income after deducting all business expenses.

(for which I used my SIN number) This is not clear to me as to why did you give your SIN no to your friend/client when the cheque was issued in business name.

If the cheques were given in your personal name then you can file your tax return as an employee (T4 income) and as a self employed sole proprietor for the business income and can also deduct all business expenses.

One is not required to register for GST until annual revenue is less than $30000.00 but as an accountant I always suggest my clients to register for GST.

-----------------------------------------------------------------
Live and Let Live. Together we can make a difference.

DP JAIN, CPA, CGA, CPA (US), CA(I), LL.B.(I)
416-305-0080
(Loans, Mortgage, Tax, Accounting, Investments)

zubs
Member since: Jan 06

Posts: 74
Location: Toronto
Post ID: #PID

Posted on: 05-02-08 08:22:52

Do one have to add GST to their invoice ( in personal name ) if the total annual revenue is less than $ 30000 when they issue that to their clients?? or GST is a compulsary thing even one is not registered ?

tamilkuravan
Member since: Jun 05

Posts: 5775
Location: God's own country
Post ID: #PID

Posted on: 05-02-08 10:05:17

Thanks Jain Saab for clarifying.
The cheque was issued to the company's name (incorporated business). What I meant by SIN number was that it is easy for the govt. to find that the company is owned by me- the sole propriter (gave the SIN number while registering for the buisiness) and that I took two incomes (one on payroll and one as the sole propriter of the business). I did not want to cheat and asked if I should pay tax on the total amount.
But as you said, I will pay tax on the pay roll and then tax seperately of my incorp. business after deducting the duductible allowances.
Thanks for the info. and time.
TK A

-----------------------------------------------------------------
I am a Gents and not a Ladies.

Maharaj
Member since: Oct 02

Posts: 1721
Location: Brampton
Post ID: #PID

Posted on: 05-02-08 10:21:21

Quote:
Originally posted by tamilkuravan
The cheque was issued to the company's name (incorporated business). What I meant by SIN number was that it is easy for the govt. to find that the company is owned by me- the sole propriter
TK A

Is it Incorporated or Sole Propritered? These two are totally different title.

-----------------------------------------------------------------
Mumbai Maazi Ladki ...

dp_jain
Member since: Jan 04

Posts: 418
Location: Brampton
Post ID: #PID

Posted on: 05-02-08 20:50:13

Quote:
Originally posted by zubs

Do one have to add GST to their invoice ( in personal name ) if the total annual revenue is less than $ 30000 when they issue that to their clients?? or GST is a compulsary thing even one is not registered ?

Yes, without fail. If business is GST registered. Otherwise NO. If business is not GST egistered but revenue goes beyond $30000.00 one has to regsiter and charge GST. Failing to which business is at risk to pay GST out of its own revenue.

dp_jain
Member since: Jan 04

Posts: 418
Location: Brampton
Post ID: #PID

Posted on: 05-02-08 20:53:07

Quote:
Originally posted by tamilkuravan

Thanks Jain Saab for clarifying.
The cheque was issued to the company's name (incorporated business). What I meant by SIN number was that it is easy for the govt. to find that the company is owned by me- the sole propriter (gave the SIN number while registering for the buisiness) and that I took two incomes (one on payroll and one as the sole propriter of the business). I did not want to cheat and asked if I should pay tax on the total amount.
But as you said, I will pay tax on the pay roll and then tax seperately of my incorp. business after deducting the duductible allowances.
Thanks for the info. and time.
TK A

Do not bother TK. Firstly, CRA seldom does it. Secondly, providing SIN to your friend will not affect your income provided (and you confirmed) cheques were given to business. Hope it clarifies.

Contributors: tamilkuravan(3) dp_jain(3) zubs(2) Maharaj(1) dudewheresmycar(1)

Jump to Page: < Previous [ 1 ] [ 2 ] Next >

Show Printable version

Send this page to a friend

Add to favorites

Discussions similar to: Question for person on Payroll and Incorporated business
	Topic	Forum	Views	Replies
	Days counted for citizenship ( 1 2 3 )	Ask Immigration Expert	4245	15
	What do these terms mean in the US employement scene?	Life	1238	1
	Taxes	Ask Immigration Expert	1082	1
	Working in US and Payroll in Canada	Jobs	1776	5
	H1 or TN, which one first	USA and other countries	1535	0
	Company Formation	Life	1682	4
	Tax implications of living in Canada and being paid in US $	Accounting and Taxation	1474	2
	Filing US taxes query.	Accounting and Taxation	1422	2
	I have not been given my ROE	Jobs	1937	1
	IF WANT TO MOVE TO U.S.A AFTER APPLICATION OF SPONSORSHIP?	Ask Immigration Expert	1865	3
	Incorporated - do I have to pay EI and use a CPA for taxes?	Business	1641	0
	Parents with zero income in 2007	Accounting and Taxation	1820	5
	Does my wife have to file taxes in Canada for 2008	Accounting and Taxation	1429	4
	Question for person on Payroll and Incorporated business ( 1 2 )	Accounting and Taxation	2647	9
	Tax Question: Canadian Citizen living in US ( 1 2 )	Accounting and Taxation	4315	11
	International Student Cash job. And then, Taxes.	Accounting and Taxation	2354	1
	Vacation payment	Jobs	1890	2
	is it better to keep file in Quebec or better to transfer to Toronto? ( 1 2 )	Family Class	3707	12
	Filing income taxes online without credit card	Accounting and Taxation	1248	2
	Incorporated Business fine assessed for receiving Payroll deduction Late	Accounting and Taxation	1391	4
	Self employed this month	Arts and Culture	1439	3
	Tax Filing	USA and other countries	1503	4
	Second TN visa if I havent paid taxes on the first?	Ask Immigration Expert	938	4
	Question - Mortgage for Incorporated Business (IT Consultants)	Financial Planning	1556	6
	CPP question	Accounting and Taxation	3537	4

Charcha

Question for person on Payroll and Incorporated business

Discussions similar to: Question for person on Payroll and Incorporated business