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Posts Tagged Compliance and Reporting
For businesses in Manitoba collecting Provincial Sales Tax (PST) .. Effective February 1, 2008:
..When the return due date falles on a weekend or a public holiday, the due date is the next business day.
This relates to PST collections starting January 2008, which is due by the 20th of the following month - which is Wednesday February 20, 2008.
From the GST Menu from Business Topics over at Canada Revenue Agency (CRA)
Ignoring Blockquotes On This Post…..
I have received this email through my Efile Newsletter correspondence, of all places …
A new GST/HST processing system and legislative changes
The Canada Revenue Agency (CRA) is replacing its current GST/HST processing system on April 10, 2007. We are also implementing changes to legislation relating to interest and penalties, which come into effect on April 1, 2007.
A new GST/HST processing system
Just a reminder .. that if you are a monthly Goods and Services Tax (GST) filer .. your GST return for the month of December 2006 is due today.
If you file quarterly .. and have a year end of either December, March, June, or September .. your Q4 GST return for the period October 1, 2006 to December 31, 2006 is due today.
If you are like me, self-employed proprietor and an annual filer .. you won’t have to file your 2006 GST return until June 15, 2007. Although, FILING YOUR RETURN and PAYMENT OF YOUR RETURN are two different things altogether. Just like your income tax, payments and balances owing should be remitted by April 30, 2007.
Businesses with sales over $30,000 CDN must register for a business number and charge 7% GST on their services or products, (6% beginning July 1, 2006). Just like the provincial retail sales tax (PST), to be compliant with the government, you must report and remit these collections over to the goverment. About this extra 7% money - it is “trust funds” - this money is not your extra profit. It’s money you collected as an agent or on behalf of the government and believe me .. they want it.
The good news, is that everybody else is also charging you GST, and you are allowed to deduct these GST payouts, or “Input Tax Credits” (GST ITC’s), to offset the amout that you have to remit. It is for this basic reason that bookkeepers (and business owners) and ME … are quite conscious to be sure to correctly separate the GST ITC from the expense amount, in order to maximize the refund or minimize how much Net GST the client has to pay.
If you don’t have the money to pay your income taxes, you should still make an effort to file your income tax return ON TIME. This way, it’s only a “collection issue” and you will only be subject to interest on the arrears balances owing. If you file late or after the due date (April 30th for most individuals and June 15th for self-employed individuals), you will have to pay a flat percentage penalty of the balance you owe plus a flat percentage penalty of the balance owing is added for every month you are late. If you’re not only late, but there was a request from Canada Revenue Agency to file your tax return .. generally these penalty rates are doubled!
Some guy once said “The difference between tax avoidance and tax evasion is the thickness of a prison wall.â€. There are legal ways to minimize your income tax bill with planning and advice of your professional accountant or income tax preparer .. but keep in mind that there are also laws in place to prevent the avoidance of income taxes. Now, evasion - is much worse than being a deadbeat, because in addition to the penalties and interest that you will be charged (if caught) .. it’s also a criminal offense.
I have many clients who have automated payroll services. By using the word “automated”, I mean specifically:
* Companies who use payroll services like Ceridian Canada etc.
* Companies who have accounting software with a Payroll Module and pay for periodic and/or annual updates
But, I also have many clients that are just single owner/shareholders or small businesses that only have 2-5 employees and find that that it is too costly to keep paying for an updated payroll service or hire a company like Ceridian.
Just a reminder … GST/HST Info Sheet about the Reduction of GST/HST ..
For those of you who will not be hiring technical support to change the rates in your Cash Registers .. you only have 35 days left to learn how to do it! So, you may as well start looking for those manuals soon!
The General Transition Rule states on Page 1:
From personal experience, I’m sure Tara Birtwhistle and Johnny Wright are quite relieved to here about this! My own 2000, 2001 and 2002 income tax returns were amended from an initial audit where I, as an independent contractor, was deemed to be an employee of a company. What this meant to the company was a whole bunch of “employer share” of payroll deductions were being requested. What this meant to ME .. was that being deemed as an employee, all of a sudden my operating business that I had operating since 1991 became non-existent - all my deductions were ignored.
Imagine if you are a store selling products and earning a gross profit after buying those products. Then you have costs to maintain your store. Ultimately, you have a net profit, pay your taxes and think you are a good citizen. Then, you get a letter in the mail saying - Your Gross Sales is your income and you should pay taxes on the GROSS …
I received this in my In-Box October 26, 2005 … it’s that time of year again, for us preparers to register with Canada Revenue Agency to renew our participation online.
Thank you for using our electronic services to file your client’s individual and corporation income tax returns.
To maintain your access to our electronic services for the coming year, you have to renew your participation online. This will allow you to use the following electronic services:
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Bookkeeper •
Income Tax Preparer •
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