Legal Loopholes That Can Reduce Your Taxes
While most small business owners in Canada don’t like to prepare their annual tax returns, most business owners say they don’t mind paying their fair share of small business taxes.
That said, business owners are always looking for ways to legally minimize their tax burden. Fortunately, the Canadian government has created a number of deductions that can help Canadian small business owners lower their tax obligations.
Below are some of the top tax loopholes for small business owners in Canada that can help you save a lot come tax time.
Tax rates are continuously changing. That’s why it’s important to find a tax professional who can find ways to help your small business defer any small business tax.
For example, income received by the business at the beginning of the year (January or February) rather than the end of the previous year (November or December) could reduce the business income for this year, which reduces the tax on your income.
Depending on a number of different factors, including future tax rates, projected income or losses, small business owners may be able to reduce the current taxes they pay by deferring some of the income they expect to receive in December, to January 2018.
Home Office Deductions
Another small business tax deduction is that you could claim a portion of your housing costs if you work from home.
This can include rent, mortgage, property taxes, utilities, telephone, and home insurance.
While you can’t claim 100% of the expense, you can claim a portion.
Make Major Purchases at Year End
Make major purchases toward the end of the year. Why? Small business owners purchase items that depreciate in value. You can deduct the cost over a period of several years.
For example, if you’re thinking of buying office equipment, a new computer, or furniture, make the purchase later in the year.
Doing so means you can claim a full year’s worth of depreciation sooner, even though you’ve only had the item for a few weeks or even a couple of days.
FBC, Helping Small Business Owners Minimize Their Tax Obligations
Taking advantage of tax loopholes to minimize the amount of small business tax you pay to the CRA is legal. Tax evasion isn’t. The tax professionals at FBC understand Canada’s ever-changing tax policies and can help your small business maximize its tax savings.
Since 1952, FBC has worked exclusively with farmers and small business owners across Canada. Over those 65 years, we have helped tens of thousands of small business owners from coast-to-coast reduce their tax obligations.
At FBC, we also understand that your accounting and tax needs are unique. That’s why we’re the only firm in Canada to offer integrated tax services on a year-round Membership basis.
For a fixed fee, Members get access to our tax planning, tax preparation, consultation, bookkeeping, and financial planning services. FBC also provides all new Members with a review of their previous 3 years’ tax returns.
For more information on FBC and the services we offer, call us today at 1-800-265-1002 or submit an online form and an FBC tax specialist will contact you at your earliest convenience.