Filing of taxes cannot be described as a pleasant task. It is a time of stress for small business owners. They definitely require the help of an adept tax accountant to help them with their tax issues before the filing deadlines. You have to be aware of the key questions that you have to ask your tax accountant as a Canadian small business owner.
What data do you need to retain?
Your tax accountant will require a minimum amount of paperwork and receipts to fill up the relevant information on your tax returns to ensure that your business receives all the deductions that it is qualified for.
What are the direct business expenses that can be deducted?
You have to be aware of the expenses that your business is qualified to deduct and this awareness will help in the planning when you file your tax returns during a year. You can deduct all those expenses that are spent on the services, rental space and equipment. As long as the business expenditure does not cross over into your home or domestic area, it could very well qualify as a deductible expense.
Is your home office expense deductible?
If you are running your business form your house, the utility bills, mortgage interests and rent amounts that you spend from the home office could be shown as deductions by your tax accountant but there are certain guidelines that have been followed. The tax accountant will be aware of the specific issues that pertain to your tax situation.
How much of the transportation expense is deductible?
If there is a car that is being used for the purpose of business, you may be in a position to deduct some part of the payments that you make towards the car expenses such as maintenance costs or insurance costs at the time of filing the returns.
How much of the household communication bills are deductible?
The tax accountant will show you how you can write off a portion of the household bills like the phone and internet expense.
How much of the travel expenses are deductible?
There could be some exclusions due to special rules, particularly if you take your family along or turn your business tour into a mini vacation for yourself; otherwise, most business related travel expense could be shown as tax deductible.
What are the special requirements for your business deductions?
When you plan to show deductions for your business, such as travel, car, household or equipment bills, you have to take the help of a tax accountant. The portion of your house which you want to show as designated home office must be a space dedicated exclusively to the purpose of business. Over claim home office can trigger tax audit by the CRA.