All income and business expenses claimed on Form T2125. Enter your income in the "Part 1 - corporate income. So how do you provide value for the entire year, you should monitor your earnings with QuickBooks or Microsoft Excel. If you sell your property, akoya pearl, you have the opening inventory for the year, and all purchases of goods year in office. - Cost of goods sold and gross profit of 4 "These figures If you sell services or ad revenue, you do not complete this section of the next section .." Part 5 - Net income (loss) before adjustments "Here you are giving operating costs. What expenses can be claimed? CRA said: "some of the costs, which are suitable for the particular type of business, and those created to generate income. Selling expenses are deductible for tax purposes. Staff, housing or other expenses, not to the enterprise within can not be deducted in order to taxation. "You can only claim part of the costs that will be used for business. For example, if half of your use of the Internet for business, the claims of 50% tax provider. Another rule of the rating agencies is that only 50% on food and entertainment. These costs could be almost anything as long as the expenses incurred for earning money. Some of them may be:
Business taxes and licenses
And the costs
Meals and entertainment (50%)
Postal and courier
Tax advantage is that if you want to keep your income and taxed on it, you will get these costs from the total income and income from commercial activities not only on demand. For example, if your marginal tax rate is 32% of business income, and you is $ 1000, you must pay an additional $ 320 tax. But what if your deductible expenses amounted to $ 1500 this year? Then you would have a tax deduction in the amount of four hundred and eightieth Thus, in this example, you actually get a discount of $ 160 on your tax return. Capital cost allowance (CCA) Now that we have discussed the reporting business expenses. With these expenses, you can claim the full amount due to the load. Although even some of the costs used for net income (loss) for the calculation, pearl earrings, some items will be subject to the rules of deduction for depreciation. CCA price range, which indicates that the amount used each year depreciable property that you claim for business. In the first year you can set on the basis of half the amount paid. It's there, if you bought the product during the year a full year of depreciation. For example, you have a desktop for $ 500. This is part of the CCA class 8 "other goods". Class 8, has a height of 20%.
The first year of $ 250 (half of $ 500) x 20% = $ 50 travel fee. It speaks about the importance of $ 450 next year.
Second year $ 450 x 20% = $ 90 travel fee. It speaks about the importance of $ 360 next year.
For the third year $ 360 x 20% = $ 72 travel fee. It speaks about the importance of $ 288 next year.
In addition, he devalued the office in this way, $ 0
These calculations are carried out in Zone A and B on page 4 of Form T2125. For home business, the following four classes may be interested in:
Software and system class 50 (55%) (100%, from 27 January 2009 to January 31, 2011 - half of the rule does not apply)
Computer network equipment - Class 46 (30%)
Small tools ($ 500 limit) - Class 12 (100%)
Other products (furniture, appliances, vehicles, machinery and equipment) - Grade 8 (20%)
As part of reimbursement will be charged, it is a different case, you can deduct the expenses exceed the income of your business. Business use of home expenses if your home is a major industry, you can use the business expenses on the home page 3 of Form T2125 to claim. Expenses claimed must include:
Maintenance (ie cleaning)
Interest on mortgages (interest only, and not pay the mortgage)
Water (if applicable to your business)
The amount you can use the site for commercial purposes. For example, if your house is 1500 square meters and the labor office 150 sqm, 10% of the costs can exceed, if you need a place for business. If you are also space for personal use, you must calculate the fraction of time it is used for commercial purposes. For example, if you have 4 hours a day, 5 days a week, you can take up to 20 hours (4 x 5) divided by 168 hours (24 x 7). In this example, only 11,9%. This will be multiplied by the calculation of square feet and will need only 1.19% of the costs above. Of course, you would be better if only room for business. In contrast, operating expenses and depreciation, we discussed the business use of home expenses can not be applied against net profit rather than net loss. For example, if you can get $ 2,000 Net income from business and $ 1500 in the use of home expenses and then claim the full amount. If you have a net loss (income minus expenses), then you can not deduct expenses for business use from home this year. However, if the dollar amount that you calculated in the form of tax, as we may be delayed until next year to register. So when you finally arrive, have a positive net income, you can claim the amount of transfer in the amount of your net income. If you still can not say anything before the others next year.