Business Matters October 2021

Dear Client:

Attached is the October edition of Business Matters! A variety of topics in this edition.

Hiring Right During Covid Times

Hiring the right person has always been a significant challenge for employers. During Covid-19 times virtual interviews, workplace safety, vaccine mandates, employee privacy, working remotely vs. on-site, etc. have become new considerations. No one said it was going to be easy! This article provides some practical advice.

Does Canada Revenue Agency (CRA) Owe You Money?

The second article regarding uncashed cheques is quite informative especially the instructions concerning how to register for an online CRA account (page 4 at the top).

Do You Owe CRA Money?

Based upon 30 plus years of providing professional services, tax returns most likely to be selected for review by CRA would be as follows:

·         Large amounts claimed for donations or medical expenses

·         Moving expenses

·         Amounts claimed as other deductions

·         Rental losses

Less common but worth noting:

·         Claims for allowable business investment losses

·         Unusually high self-employed expenses especially travel and vehicle

The article does a good job of explaining the difference between reviews and audits. What should you do? Keep documentation to support any amounts claimed on your tax return for at least 7 years.

Wealth Management

This article is primarily for 20 to 30-year olds but the 5 mistakes listed can apply to anyone (except perhaps #3). The two main points appear to be -  avoid credit card debt and start saving.

Questions, comments?  Stop by or send an email.

All of us at Jim M. Smith CPA Inc. wish you the very best for the holiday season and for 2022!

Yours truly,

JIM M. SMITH CHARTERED PROFESSIONAL ACCOUNTANTS INC.

Business Matters June, August 2021

Dear Client:

Attached are Business Matters for June and August, 2021.  As always, a wide variety of interesting material.

June 2021 - Read Here

Covid-19 Support Programs

Coronavirus is not going away any time soon it would seem, however, most of the business support ended Sept. 25, 2021.  There is a hiring benefit in place until Nov. 20, 2021. There are several programs in place for individuals the details of which are in the article.

Federal Budget Tax Changes

A number of personal tax changes were included in the budget – most of which are very narrow in scope.

Corporate tax changes include a significant change to capital cost allowance (depreciation) rules. Capital purchases made between April 20/21 and December 31/23 may be immediately expensed (certain long-lived assets such as buildings are excluded). This is a substantial change that will affect many clients. Read on!

Data Privacy and Security

It seems every edition of Business Matters has an article on this topic. Regardless of the size of your businesses or organization data security is important. From the article “it takes time, planning and practice to guard your organization’s data.” Some of the content included in the four-step process will seem too “big company” for you but the basics should be implemented.

FIRE

What is FIRE?  Financial Independence Retire Early.  Personally, I think I have missed this one!  An interesting article. Great quote from Charles Dickens at the end of the article.

August, 2021 - Read Here

Hiring Virtually

If you are starting to hire staff by conducting virtual interviews this article provides some very good information. The last line in the article provides the best advice.

Principal Residence Exemption

A good discussion concerning what properties will or will not qualify for the principal residence exemption. Remember since 2016 Canada Revenue Agency has required the sale of your principal residence to be reported on your tax return. Often the first hint that a client has sold their house is receiving a note that their address has changed! Please let us know if you sell your house during the year.

Departing Canada – Tax Consequences

Emigrating from Canada can have significant income tax consequences. Provide a list of your assets to us before you leave and we can inform you of the different options available to minimize the tax bill. Enough said!

Hacker + Your Phone Number = Problems

The final article concerns different ways hackers can use your phone number and information posted online to perpetrate fraud. The hackers must be making money because the fraud keeps happening. Be careful.  Passphrases instead of passwords – I like that!

We hope that everyone is enjoying the great fall weather.

Happy Thanksgiving!

Yours truly,

JIM M. SMITH CHARTERED PROFESSIONAL ACCOUNTANTS INC.

Jim M. Smith, CPA, CA

P.S. Please take precautions against Coronavirus for the sake of your family, friends and co-workers.

 

Business Matters February 2021

Dear Client:

We hope that everyone is healthy at your household and place of work and enjoying the great weather of the last few days. March 13 will mark the one-year anniversary of the corona virus.

What have we learned?

The deadline for applying for CEBA ($60,000 interest free loan) is March 31, 2021. Please access this funding if you have not already done so.

Attached is the latest edition of Business Matters (Feb 2021 edition).

Personal tax changes relating to COVID-19

This is an interesting, comprehensive article but in reality, the changes are not hugely significant. If you work from home you can deduct certain expenses using either a simplified method (highly recommended) or a detailed method. Both are explained well in the article. Payments received under the five Covid-19 support programs listed in the article on page 2 are all taxable. It’s a little inconsistent that the Federal government requires employers and other payers to withhold income tax on payments to individuals but did not withhold income tax on COVID-19 benefits but this is a topic for a different time and place.

Other personal tax changes

Again, nothing major. Please note- the filing deadline is April 30 unless you or your spouse is self-employed in which case the deadline is June 15. The deadlines have not been extended for 2020. Something new is the Canada Training Credit (CTC). The CTC is explained on page 4. Thank goodness for computers to track all of the different tax related accounts (RRSP, TFSA, RESP, CTC, RDSP, CNIL, RHBP, etc. I probably missed a few. RHBP= registered homebuyers plan which I may have made up!).

Technology

Anyone that operates in an environment where computers are essential tools should read this article. I don’t understand much of the technical jargon but I don’t have to. I read more and more articles about computer networks getting hacked and it makes me think ……. Scary thoughts. Next-generation antivirus (NGAV) solutions are discussed on page 6. Something to ask your cybersecurity expert about.

Investment Options and Expectations

 

The wealth management article discusses the risks associated with 3 different types of investments which are.

            *equities (stocks)

            *fixed income (bonds)

            *cash (GIC’s, savings accounts)

There is a neat chart on page 8 which compares rates of return for the 3 different types of investments. Keep in mind that the rates listed have not been adjusted for inflation.

That’s it!

I’m sure we will connect with each of you in some fashion during tax season.

In the meantime; questions, concerns, comments. Let us know.

Yours truly,

JIM M. SMITH CHARTERED PROFESSIONAL ACCOUNTANTS INC.

Jim M. Smith, CPA, CA

 

Business Matters April, May, August and October 2020

Dear Client:

Attached are the April, May, August and October 2020 editions of Business Matters. We are behind in providing these articles – blame it on Covid-19!

April Edition - Read Here

Buying a Business doesn’t happen very often. When it does you need to consult professionals to represent your interest in the transaction. How best to structure the purchase, shares or assets, due diligence, etc. Read the article and then consult your advisors.

Voluntary Disclosures Program (VDP)

Very informative article about the VDP, the different programs available under the income tax and GST streams, what the programs will cover and a brief summary of recent court cases. Full information available at the website address listed at the end of the article.

Blockchain is the subject of the technical article in this edition. There is lots of buzz about Blockchain but we still haven’t seen any use amongst our clients. Something to monitor and assess as it moves forward and evolves.

Babies?

Haven’t seen many articles about babies in Business Matters but of course it’s cost that is being discussed. Personally, I have never really felt that these types of articles were very useful. The cost to raise a child will vary significantly depending upon the lifestyle of the family, where the family lives, how many activities the children are involved in, etc. Given all the variables, I’m not sure a figure of $X/child makes much sense. Lots of good, general information.

May Edition - Read Here

There were lots of scams before Covid-19 and the fraudsters certainly have not let up in the last few months. Good article on common Covid-19 Scams. Make sure to read the information listed under “Protect Yourself” on page 2.

Taxation

This article is all about Covid-19 federal government support. Most of this is very old news at this point in time but the Canada Emergency Wage Subsidy is still worth considering.

Manitoba has a wage subsidy program worth a look – https://www.gov.mb.ca/covid19/restartmb/btwmp.html

The Tech article is all about digital and electronic signatures. We are still not using either but we probably should be. Don’t know the difference between digital and electronic?  Read on! Good detail in the article.

The final article in the May edition is a brief overview of what happened to investments during March and April. Sharp decline and then a recovery.  The experts were right – don’t panic, bide your time.

August Edition - Read Here

Nothing strikes more fear in the heart of many individuals than the words “U.S. income taxes”.  If you are a U.S. citizen you must file a U.S. federal tax return. Don’t forget the FBAR form.

Corporations must file U.S. tax forms if they are “physically present” in the U.S.  Best advice – consult a professional that specializes in U.S. taxation.

Update on Covid-19 Assistance

This article is a little out of date. Some of the assistance programs mentioned have ended or “transitioned” to different types of assistance. Small businesses should review the programs still available. Questions ?  - Please contact us. Remember there is wage assistance available through the Manitoba restart program.

The Tech article is very topical – Preserving Security While Working Remotely. I found the article to be quite informative. Covid-19 has not forced our office to work remotely – we have been very fortunate. Who knows where we will be 6 months from now!

Wealth Management

Do you know how much you spend each month, each year? Many clients are surprised when we review their personal tax returns each year and show them in black and white the gross amount of their family income. “Where did it all go?” they will ask.

Review your spending/saving, revisit your investment plans and consider end of life financial issues. It’s not complicated – it just needs to be done.

October Edition - Read Here

The management article is all about “winterizing” your workplace against the effects of Covid-19. It could be interesting if we have a “bad” flu season. I think clients have done a very good job of adapting so far. Keep communicating in a straight forward, honest manner with staff.  Read on!

Whole Life Harmony?

Have to admit this is a new term to me. The article indicates that there are eight chords or facets of life that should be in harmony. The article goes on to define harmony and list the 8 facets. Hmmm… I like the 6 points listed on page 4. Running through the points should give you a good snapshot of where you are at. You have to start somewhere!

Taxation

It’s another article about U.S. Taxes for Individuals. This time the focus is on “Accidental Americans” which is something you do not want to be when it comes to taxation. However, there are some definite advantages to being a U.S. citizen. Check out the article.

Wealth Management

Interest rates are at record lows – is it time to borrow to invest? Borrowing to invest is what this article is all about. There are some good points in the article. What is your ability to take risk and what is your willingness? These questions must be answered for leveraged investing. They also should be answered when you are thinking about whether or not to start a business.

It has been a great fall, weather-wise – not so much Covid-19 wise. We hope that everyone in your “bubble” is healthy and optimistic as we move forward.

Happy Thanksgiving and all the best!

Jim M. Smith, CPA, CA

JIM M. SMITH CHARTERED PROFESSIONAL ACCOUNTANTS INC.

 

Business Matters February 2020

Dear Clients:

Attached here is the February, 2020 edition of Business Matters.

Topics discussed in this edition include:

1)      Cyber Security – Mitigating the Risks of Cyber Attacks

2)      Your Credit Score – What does it Mean?

3)      Protecting Your Business from Identity Theft

4)      Tax and Ethics

Lots of good information in each of the articles.

It looks like we could enjoy an early spring this year – let’s hope the snow stays away!

Remember it is personal tax time!  If you have not already done so, please drop off, email or mail your information to our office. Please contact our office if you have questions.

Best regards,

JIM M. SMITH CHARTERED PROFESSIONAL ACCOUNTANTS INC.

Jim M. Smith, CPA, CA

Business Matters February 2019

Dear Client:

Attached here is the February edition of Business Matters.

Taxation

First up is an article outlining income tax changes for 2018. There are very few personal tax changes. The changes affecting companies have been discussed for some time. The takeaway from this article at this time of year should be organize your income tax information and forward it to us before April.

Management

The SCARF Model is something relatively new to us (the book, Your Brain at Work, was recommended at a seminar last fall). Be prepared to spend some time investing in the “process” of understanding how people react the way they do.

Do you or Don’t You?

Do you or don’t you have a Will?  How old is your Will? Has your family situation changed? What about your assets? A well thought out Will is one of the best gifts you can give your family.  Read on.

Privacy Compliance Strategies for Businesses

In an era of hacking and data breaches it is important for businesses to have a compliance strategy for Canada’s privacy laws. The six points listed on page 8 are an excellent starting point.

That’s it! Questions – contact us. We love interactions with clients.

Winter is over (almost). It’s time to enjoy some warmer weather and longer days.

Best regards 

JIM M. SMITH CHARTERED PROFESSIONAL ACCOUNTANTS INC.

Business Matters News

Dear Client:

Attached are the October and December issues of Business Matters – sorry for the delay!

OCTOBER 2018

Taxation

Very interesting discussion about higher CPP contributions which are being phased in over seven years starting in 2019. The impact will be significant for companies with larger payrolls.

Something to consider. Payments to employees from profit sharing plans are CPP exempt. Perhaps there is a profit-sharing plan in your company’s future especially for employee bonuses. Contact us to discuss.

Management

How do you maintain safety in the workplace? Most employers take employee safety seriously and safety awareness has increased substantially over time. This management article provides an outline concerning how to conduct a proper safety inspection – quite detailed. Don’t forget to document and follow-up.

Investing

The investing article is all about self-directed investments – advantages and disadvantages, types of accounts and the “catch-all” category other considerations.

If you do choose to go self-directed, be willing to spend some time on investment analysis, review and tracking of income and expenses.

Moneysaver

We have definitely heard a lot about the High Cost of Stress over the past number of years. For the most part, in business, we don’t deal with people suffering from extreme stress but some level of stress will be present in the work place everyday on an ebb and flow basis.

“Controlled” stress can be healthy and some people perform best under certain levels of stress – others do not. In your business do you know which staff are which in terms of stress tolerance?

DECEMBER 2018

Technical

Not every issue of Business Matters has a tech article but The Path to Automation is well worth the read. Canadian businesses need to automate (our productivity lags).

Automation is becoming more feasible for small businesses. Think about how automation could help your business – see the points on page 2.

Taxation

Does your business include “bartering” transactions? Do you sell goods or services using the internet on more than a casual basis? The taxation article discusses tax implications (GST, HST, income tax) of bartering and internet sales. It does not discuss PST but it probably should.

Moneysaver

Detailed article outlining how to “job-cost” your equipment and vehicles.

Whether it pays to job-cost your vehicles/equipment will depend, to a large extent, on how many dollars you have invested. The larger the investment the more worthwhile the exercise. Quickbooks or Sage can help you track costs.

Management

No business likes to lose clients but it happens. Check out the article Eight Reasons Clients Leave.  I don’t think there are any surprises in the list of reasons provided in the article. Complacency needs to be avoided – how do you stay “fresh” in your workplace?

Last but not least, we have attached a one-page memo discussing a Fixed vs a Growth Mindset.  Please read.

We are in the depths of what has been a fairly benign winter season so far. We hope that you enjoyed Christmas holidays. Take time to enjoy some “snow sports” before we lose the white stuff.

Best regards,

Jim M. Smith, CPA, CA

 

Dear Client:

Attached here is the August/18 edition of Business Matters. A couple of management articles, one tech and one tax. Let’s get started!

Complacency

It is a very natural tendency to become complacent at work, at home, etc. The first management article is about recognizing and combating complacency at work. As managers we have to be creative to alleviate complacency and ensure productivity. Read on for some tips you can use to combat complacency.

Electronic Signatures

We still do not see many electronic signatures in our practice. The time may be coming but it’s not here yet. All you ever wanted to know about electronic signatures in the tech article.

On a different but similar topic, make sure you have multiple signing authorities on business bank accounts.  If something happens to the owner/manager and only he/she has signing authority the business could suffer – a lot.

TFSA Taxation on Death

Good summary of what happens to TFSA’s when a person passes away. The takeaway from this article “there are potential tax complications with a TFSA when a taxpayer passes away.” Your financial institution and Chartered Professional Accountant can provide answers to any questions you may have.

Control = Responsibilities

The second management article discusses what having control of a business means. It’s not what you might think. After the article lists the dire consequences of not being in control of your business, it concludes that a culture fostering processes and procedures within a company that ensures compliance with external rules and regulations is absolutely essential to ensure proper control. Kind of wordy but makes sense.

That’s it for the August edition!

May you have “fair winds and following seas” in the months ahead.

Best regards

JIM M. SMITH CHARTERED PROFESSIONAL ACCOUNTANT INC.

Dear Client:

Attached is the June/18 edition of Business Matters. It arrived on time, but we’re slow in passing on the information. Our apologies. Let’s get started. Click here to read the articles.

Taxation

Really this is an article about potential cash flow issues that can arise if you don’t manage tax liabilities properly. Over the past 20 plus years we have seen many different nightmare scenarios in dealing with Canada Revenue Agency. As the article states “Take Charge” by completing the steps listed on page 2.

The Eyes Have It

The tech article concerns eye strain when working with screens – computers, laptop or smartphone. We’ve all experienced tired or sore eyes on more than one occasion while staring at a screen. Give those eyes a break! See the tech article for helpful hints about relieving the symptoms, eye management, etc.

Websites – Windows to the World

If your business does not have a website – get one. If it does, refresh the site often. Those are the primary take aways from this article. Also, make the website specific to your business. Good article – hey we need to update our website!

Scammers

As the article states “Scams and frauds are probably as old as humanity” but let’s face it – computerization has taken things to a whole new level. The article discusses different types of scams and how to protect yourself. Read on.

That’s it for the June edition. check out past issues on our website at jimsmithaccounting.ca.

Enjoy the rest of summer and your vacation time – hopefully you still have some left!

Best Regards,

JIM M. SMITH CPA INC.