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Small Business Accountant in Oakville, Burlington

Amazing success stories – a 90% success rate – cpc business plans, monitoring & execution

Starting a new business or decision to accelerate growth of existing business

CPC Accounting works with new & existing entrepreneurs all the time , and we find 90% success stories, share a discipline which unfolds as follows:

1. A 60 months detailed business plan , based on lead generation strategy, client acquisition potential and resulting in a  “Profit after tax” tracked every month against actuals leading to Vision of Profit after tax and Business Valuation after 5 years.

The 5 Year Business Plan builds a very realistic Profit after tax growth (assessing the Product Pricing, Volumes to sold, employee expenses, Cost of good sold, ROI for Advertising & marketing expenses , operational expenses) , a monthly Cash Flow analysis and a monthly Balance Sheet tracking the need for Credit Lines, goodwill etc).

The business plan is tested under various stress simulations and a decision to go ahead is based on a simulation that the owners and Clearwater Professional Corporation agrees upon.

2. Once step 1 is approved, we go forward and execute the following:

  •  Incorporate the company
  •  Open Bank accounts
  •  Register with CRA (I.tax, HST, Payroll , WSIB etc)
  •  Setup Cloud based accounting systems
  •  recruitments
  •  Open the door for Business

The above steps normally takes two weeks.

For existing owners, milestones , deliverables and resources are put into place based on the 5 year business plan (60 month) to achieve the Growth aspirations, measured in Profit after tax and Business Value for sale at the end of the 60th month.

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Canadian Tax Year 2018

As 2018 draws to a close, it’s a good time to meet with your accountant and have an informed discussion about maximizing tax savings for the past year. Small business owners, in particular, have many opportunities to save on their yearly taxes, so take a few minutes to review your options with an expert before 2018.

In this blog, we’ll take a look at some of the changes in tax provisions that will affect individuals and small businesses below:

Eligible Deductions & Credits

If you pay the following expenses by December 31, 2017, they will be eligible for the deductions of tax credits. In other words, you’ll have to pay less for the past tax year:

  • Childcare expenses
  • Moving expenses
  • Investment council fees
  • Charitable donations
  • Accounting fees
  • Medical expenses
  • Tuition fees
  • Deductible support payments
  • Political donations
  • Interest paid on loans used to purchase investments

Contribute to Your RRSP

The most popular tax tool available to the average person is investing in a Registered Retirement Savings Plan (RRSP). Contributions to RRSPs are tax deductible and the income earned within the RRSP grows until you retire — with taxes deferred. You can claim a contribution of up to 18% of your earned income from 2016 (to a maximum of $26,010).

Earned income includes the following sources:

  • Employment income
  • Business income
  • Net income from rental properties
  • CPP disability pension
  • Certain types of royalties
  • Spousal or child support payments that are included in your income

Remember that your contribution limit may be subject to a pension adjustment reversal from 2016. So if your employer is making contributions to a pension plan, or actuarial commitments to such plans in the year 2016, then these will be reflected in this pension adjustment.

It is also important to remember that the age limit for RRSP contributions is 71. The age limit for converting an RRSP to an annuity or RRIF is also 71.

Finally, don’t overcontribute — a severe penalty will result. If you have any questions about RRSP contributions, talk to a professional accountant today.

Capital Gains Exemption Deduction

The Lifetime Capital Gains Exemption Deduction applies to individuals who dispose of shares in a qualified small business corporation, or in a qualified farm or fishing property. The exemption is $835,716 for small businesses and $1,000,000 for farms or fishing properties.

If you have already claimed the $100,000 Personal Capital Gains Exemption, which ended in 1994, then this will reduce the amount of Lifetime Capital Gains Exemption available to you.

You must also verify whether you have claimed allowable business investment losses (ABIL) in prior years or have cumulative net investment losses (CNIL) as of December 31, 2017. These items will also affect the amount of exemption that can be claimed.

Use Your Capital Losses to Reduce Income Taxes

Did you know that you can use your 2017 capital losses to reduce your current year’s income taxes, by applying such losses against your 2017 capital gains?

This can be an effective strategy for reducing what is owed in a given tax year — but you must be careful of the superficial loss rules, which prevent you from claiming a capital loss on an identical asset that you reacquired 30 days before or after the sale date.

If your capital gains were realized in the years 2014 to 2016, and net capital losses were incurred in 2017, then you can carry these losses back against previous years’ capital gains. You can also carry the unused 2017 losses forward to future capital gains.

The last 2017 transaction date effective for publicly-traded securities is December 22, 2017.

Other Tax Planning Recommendations

There are many other strategies available for individuals and business owners who want to save on their income taxes in 2017. Here are some quick recommendations from our team, which you may want to consider:

  • Consider a Registered Education Savings Plan (RESP) for your children.
  • Set up a Tax-Free Savings Account (TFSA).
  • Review your December income tax instalment.
  • Make a low-interest loan to your spouse.
  • Repay outstanding shareholder loans and pay interest on employee loans.
  • Contribute to your spouse’s or common-law partner’s RRSP to the extent of your RRSP deduction limit for 2017. This doubles the amount a couple can withdraw for the Home Buyer’s plan.
  • Consider a Registered Disability Savings Plan for a child with a severe disability.
  • Claim you personal tax credits.
  • Keep your transit passes (up to June 30, 2017).
  • Pay reasonable salaries to family members in 2017.
  • Convert non-deductible debt to deductible interest.
  • Review your will every 5 years.
  • Split pension income with a spouse.
  • Apply for Home Buyer’s tax credit, if you are a first-time homebuyer.

Got questions about these recommendations or anything else in this article on 2017 taxes? Contact the team of Chartered Professionals Accountants at Clearwater for more advice.

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Top Traits of a Successful Small Business Accountant

When surveyed about key factors that led to their success, most small business owners singled out the selection of a good accountant as the most important asset. This resource was found to be a common factor for businesses that were acquired from a previous owner, inherited from a family member, or founded as a startup.

This survey of small business owners also uncovered fourteen important qualities (mentioned below), which were identified as the top traits shared by successful small business accountants:

1. An advisor and a business partner

These accountants provided much more than simple records of transactions and yearly tax filing services.

Successful small business accountants partnered with business owners in driving the strategy of the business, with well-constructed business plans and monthly face-to-face sessions supported by valuable data analysis.

2. Monthly financial statements

These accountants used sophisticated systems and processes to generate monthly financial statements for the following:

  • Profit & Loss
  • Balance Sheet
  • Cash Flow
  • Bank Reconciliation

They were also able to provide data in real-time through systems based on cloud computing and assisted by artificial intelligence.

3. Expert planners with a strategic mindset

These accountants had the business experience and the professional background to think Strategically. They also provided valuable advice on long-term business plans, structure for pricing, volume analysis, sales channels selection, fixed and variables costs analysis, and the precise calculation of taxes.

4. Advanced tax planning

One valuable by-product of monthly financial statements, meetings, and a strategic mindset is that the accountant and the business owners were able to discuss and execute tax strategies fairly in advance and generate substantial savings.

5. Cash flow-focused

Monitoring and projecting advanced cash flow is like monitoring the lifeblood of the business. Profits do not necessarily translate into much needed cash. A close monitoring of bank reconciliations on a monthly, if not a daily basis, is another key process that good accountants and businesses will follow.

6. Analytical mind

One of the most appreciated traits of a successful accountant — which leads to good advice and follow-up — is an analytical mind that is trained to generate and interpret pertinent information. This analytical mind provides the ability to spot any telling signs or trends that would otherwise escape the layman.

7. Professionally qualified & knowledgeable

It almost goes without saying, but a professionally qualified and trained accountant is a necessity, if you want to be successful. Professional qualifications show that the accountant knows how to maintain high professional standards and ethical conduct in all matters, in addition to possessing a deep understanding of numbers, rules, regulations, and laws.

8. Works with the latest technologies

Technology is developing at an astonishing rate, with cloud computing, artificial intelligence and blockchain technologies forming a substantial part of the accounting ecosystem.

Today’s accountant must be comfortable working with these technologies to help grow your revenue faster, track costs better, help choose the right inventory systems, and so on.

9. Access to other small business service providers

Small business owners need access to the same professionals that their larger counterparts use to run their business, (i.e bankers, foreign exchange traders, lawyers, and wealth managers). Great accountants will usually partner with these professionals, especially those catering to small businesses. Your accountant should be able to refer you to these types of service providers when you need them.

10. Cost management and investment monitoring

A good accountant understands the delicate balance that the small business owner must maintain between reducing waste and investing to boost future revenues. A good accounting partner will be able to help a small business owner measure the cost of those additional investments or the impact of reducing costs.

11. Succession planning capabilities

At a certain stage of the business lifecycle, small business owners will face the decision to either go public, name heirs to the business, or sell it. A professional accountant can help with the selection of professional valuation firms, the IPO process, or simply assist in transitioning the business legally and financially to the heirs.

12. Corporate structuring

As a business partner who has access to the market, and the inner workings of other successful businesses, the accountant is usually in a position to recommend changes to the business’s corporate structure that would further boost growth or stem any loss of revenue.

13. Debt planning

At a certain stage of growth, all businesses may require access to banking channels, debt markets, and other lenders to either enhance capital or borrow on short and long terms. This is especially true for start-up businesses. A great accountant has connections in the marketplace and will be able to access these funds or make recommendations to the business owner.

14. Acquisition as a growth strategy

In some instances, small businesses hit a plateau, in terms of growth, where organic business growth strategy is simply not an option. During their career, a successful accountant has usually worked on an acquisition and will understand what is required in terms of due diligence, purchase, bedding the acquisition, and so on. In an ideal situation, they will have handled the complete acquisition cycle and can work with a team of professionals to identify the right fit for their client.

Looking for an accountant who fits the above traits? Book a consultation with the team at Clearwater to see if we’d be a good fit for your business.

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