Last updated: Oct. 8, 2021
Life on the road is different. Running a business from your cab is an experience that few people who sit behind desks or work from home even begin to comprehend. Layer in the fact that you’ve incorporated your business and are trying to manage all the additional paperwork, while juggling a dozen other tasks to keep your business on the move – now a tough job gets even tougher.
It’s unlikely that you chose a career behind the wheel because you love bookkeeping, filling out forms, or trying to figure out taxes and the CRA. It’s not unusual for professional drivers in Canada to put off doing their bookkeeping or fall behind on their taxes.
But falling behind means you’re probably not taking full advantage of the benefits available to you as an incorporated business. It’s also likely that you’re paying more in taxes than you should be.
Tackling the T2
If you don’t like paperwork, you’re going to hate Canada’s T2 Corporate Tax Return form. It’s far longer and much more complex than the tax forms used by individuals and sole proprietorships. Some people think that with all the tax software available, completing a corporate tax return won’t be a problem.
You really have to know what you’re doing to tackle the T2 on your own. Even if you do make it all the way through it’s hard to tell if you missed an important deduction, miscalculated your accumulated depreciation, or carried forward the right numbers from previous years.
That’s where a tax consultant who knows the industry can help save you a lot of money and time. Whether you’re an independent owner/operator or a small carrier with big dreams, the right tax consultant can keep your bookkeeping and tax filings current to ensure you’re maximizing tax deductions and holding on to more of your hard-earned money.
Deductions and Expenses
Aside from the sheer complexity of the T2 Corporate tax return, there are a number of specific tax deductions available to incorporated businesses including those in the trucking industry. There are also some specific deductions for which only long-haul drivers are eligible. The fact is, it can be difficult to keep track of them all.
For example, if you’re a truck driver, you can deduct 50% of your meal and beverage expenses. However, if you’re a long-haul trucker, you can deduct 80% of meal and beverage expenses during eligible travel periods. Long-haul truckers can also deduct lodging and shower expenses.
Some other eligible expenses that drivers and carriers can claim include:
- Vehicle lease payments
- Interest expense on truck loans
- Truck maintenance costs
- Fuel expenses
- Load securement services and fees
- In-cab living expenses
- Internet and mobile phone expenses
- Cleaning supplies
- Dry cleaning fees
Finding time in your busy schedule to meet up with a tax consultant when you’re out of town and on the road is difficult at the best of times. Make sure you use a tax consultant that understands your schedule; tax consultants that will arrange their schedule around yours will meet up with you to collect your tax information and get to know your business better.
A tax consultant with a comprehensive understanding of corporate tax regulations and the Canadian trucking industry can help you save money in the long run. They can show you all the legal loopholes you can take to reduce your taxes and get your money back to you as soon as possible. An inexperienced tax consultant on the other hand, will end up costing you.
Free Download: The Ultimate Guide to Incorporated Small Business in Canada
Many incorporated business owners feel intimidated by the demands of tax season and the corporate filing requirements of the Canada Revenue Agency (CRA). This is completely natural.
While there are numerous benefits to incorporation, it also comes with complex obligations. The complexity and administrative burden of these requirements leave many businesses struggling to keep up.
That’s why we’ve created “The Ultimate Guide to Incorporated Small Business in Canada”. Not only will it help you get organized for tax season, but it will help you make sense of your obligations under a corporate structure and to take advantage of the benefits!
Helping Canadian Truckers Reduce Their Tax Burden
It’s easy to forget or overlook things when it comes to preparing your taxes; whether its expenses, deductions, or tracking GST/HST appropriately, it all adds up. We have worked with Canadian truckers since 1952, from BC to Nova Scotia helping them organize their books, manage payroll, and optimize their corporate and personal tax position, for today and for their future.
You keep your eyes on the road and we’ll watch over your financial health.
To find out more about how we can support your business, take 15 minutes to connect with us so we can get to know each other. Request a consultation here.