Abigail Vaughan

It’s a write-off! Do you even know what a write-off is? Yeah, it’s when you buy something for your business and the government pays you back for it. Sounds ridiculous when you lay it out like that, but this is actually a common misconception! So let’s talk about it, write-offs are certainly beneficial, but there is a lot of confusion as to the extent of the benefit. People tend to think that writing something off means you get the money back. What it actually means i...s that you get to claim some or all of the expense against your business income. Here’s is an illustration of the tax savings of a $400 business expense if your marginal tax rate is 25% and you earn business income of $1,000. Gross income $ 1,000 $ 1,000 Expense $ 0 $ 400 . ______ ______ Net income $ 1,000 $ 600 Tax rate 25% 25% . ______ ______ Taxes owing $ 250 $ 150 As you can see the tax benefit of a write-off is essentially the amount of tax you would have paid on the incremental income that was reduced by the expense. So in this case, you save $100 of taxes (which is your 25% tax rate applied to the $400 expense). This benefit is further reduced for situations involving capital assets and partially deductible expenses, and is for illustration purposes only! Need help with write-offs? I’m your gal! Link in bio. #canadiantax #taxtip #writeoff #ottawavalley #renfrew #accountant #cpa #smallbusiness #smallbusinesstax #ontariotax

It’s a write-off! Do you even know what a write-off is? Yeah, it’s when you buy something for your business and the government pays you back for it. Sounds ridiculous when you lay it out like that, but this is actually a common misconception! So let’s talk about it, write-offs are certainly beneficial, but there is a lot of confusion as to the extent of the benefit. People tend to think that writing something off means you get the money back. What it actually means i...s that you get to claim some or all of the expense against your business income. Here’s is an illustration of the tax savings of a $400 business expense if your marginal tax rate is 25% and you earn business income of $1,000. Gross income $ 1,000 $ 1,000 Expense $ 0 $ 400 . ______ ______ Net income $ 1,000 $ 600 Tax rate 25% 25% . ______ ______ Taxes owing $ 250 $ 150 As you can see the tax benefit of a write-off is essentially the amount of tax you would have paid on the incremental income that was reduced by the expense. So in this case, you save $100 of taxes (which is your 25% tax rate applied to the $400 expense). This benefit is further reduced for situations involving capital assets and partially deductible expenses, and is for illustration purposes only! Need help with write-offs? I’m your gal! Link in bio. #canadiantax #taxtip #writeoff #ottawavalley #renfrew #accountant #cpa #smallbusiness #smallbusinesstax #ontariotax

I apologize for being a little M.I.A. lately - tax season, amiright? But I’ve been (happily) busy responding to messages, and getting everything up and running on the firm-front. But more importantly it’s #taxtiptuesday! This week I wanted to talk a little bit about capital gains. I already touched on the capital-gains/principal-residence situation from selling your primary residence but let’s talk about selling other properties.... Investment and real estate properties are becoming more and more popular amongst clients these days. When you sell real estate that is not eligible for a principle residence exemption, that sale is subject to capital gains tax. It’s important to have a good accountant on your side when dealing with these transactions as are there are numerous ways to reduce the capital gains tax you’ll owe including reviewing your ACB (adjusted cost base) for any potential missed additions (costs to acquire, capital improvements, etc), and reviewing any outlays and expenses on the disposition. If you’ve disposed of any rental properties, investment properties, or land during the year and want to ensure you have the lowest tax bill possible (who wouldn’t?) - I’d love to help! I enjoy adding value to my clients by keeping as much money as possible in their pockets. Visit avcpa.ca/get-started to contact me. Link in bio! #ottawavalleytax #taxsavings #capitalgains #realestatetax #capitalgainstax #ottawavalley #cpa #taxtiptuesday #taxtuesday #taxtidbit #ontariotax #canadiantax #virtualtax #ottawaaccountant #renfrewontario #renfrewcounty

Okay, but what about buying software for your business? Believe it or not, you can’t just expense it. Software is considered a depreciable property, which means you need to capitalize it and claim the expense over time as depreciation (CCA - capital cost allowance). Systems software needs to be capitalized in Class 10 and expensed at a rate of 30% per year while other softwares deemed to have a shorter useful life can be capitalized in Class 12 and expensed at a rate of 100%.... On top of that, both classes of software are subject to something called the half-year rule, which means only half of the allowable CCA is actually deductible in the first year. If you need tax help this year, check out avcpa.ca - link in bio. #smallbusinesstax #ottawavalleytax #ontariotax #canadiantax #financefriday #capitalcostallowance #taxation #CCA #accountant #cpa #ottawavalley #taxtidbit #ontariotax #tax #taxes #renfrew #cpa #accountant #cra #ottawavalleyaccountant

I apologize for being a little M.I.A. lately - tax season, amiright? But I’ve been (happily) busy responding to messages, and getting everything up and running on the firm-front. But more importantly it’s #taxtiptuesday! This week I wanted to talk a little bit about capital gains. I already touched on the capital-gains/principal-residence situation from selling your primary residence but let’s talk about selling other properties.... Investment and real estate properties are becoming more and more popular amongst clients these days. When you sell real estate that is not eligible for a principle residence exemption, that sale is subject to capital gains tax. It’s important to have a good accountant on your side when dealing with these transactions as are there are numerous ways to reduce the capital gains tax you’ll owe including reviewing your ACB (adjusted cost base) for any potential missed additions (costs to acquire, capital improvements, etc), and reviewing any outlays and expenses on the disposition. If you’ve disposed of any rental properties, investment properties, or land during the year and want to ensure you have the lowest tax bill possible (who wouldn’t?) - I’d love to help! I enjoy adding value to my clients by keeping as much money as possible in their pockets. Visit avcpa.ca/get-started to contact me. Link in bio! #ottawavalleytax #taxsavings #capitalgains #realestatetax #capitalgainstax #ottawavalley #cpa #taxtiptuesday #taxtuesday #taxtidbit #ontariotax #canadiantax #virtualtax #ottawaaccountant #renfrewontario #renfrewcounty

Okay, but what about buying software for your business? Believe it or not, you can’t just expense it. Software is considered a depreciable property, which means you need to capitalize it and claim the expense over time as depreciation (CCA - capital cost allowance). Systems software needs to be capitalized in Class 10 and expensed at a rate of 30% per year while other softwares deemed to have a shorter useful life can be capitalized in Class 12 and expensed at a rate of 100%.... On top of that, both classes of software are subject to something called the half-year rule, which means only half of the allowable CCA is actually deductible in the first year. If you need tax help this year, check out avcpa.ca - link in bio. #smallbusinesstax #ottawavalleytax #ontariotax #canadiantax #financefriday #capitalcostallowance #taxation #CCA #accountant #cpa #ottawavalley #taxtidbit #ontariotax #tax #taxes #renfrew #cpa #accountant #cra #ottawavalleyaccountant

Did you know you should never send confidential tax information via email? I offer completely contact-free tax return preparation, including a secure document portal, multi-level authentication e-signatures, and e-filing. Get your taxes done this year without even leaving your home!... Covid-19 friendly, pajama approved. Visit avcpa.ca/get-started to book. #virtualtax #canadiantax #womeninbusiness #ottawatax #ottawavalley #renfrew #accountant #cpa #taxseason

Did you know you should never send confidential tax information via email? I offer completely contact-free tax return preparation, including a secure document portal, multi-level authentication e-signatures, and e-filing. Get your taxes done this year without even leaving your home!... Covid-19 friendly, pajama approved. Visit avcpa.ca/get-started to book. #virtualtax #canadiantax #womeninbusiness #ottawatax #ottawavalley #renfrew #accountant #cpa #taxseason

International Women’s Day hits a little different this year... it is my first as a mother of a baby girl, and my first as a business owner. I am so proud to introduce you all to my practice, Abigail Vaughan - Chartered Professional Accountant. Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do. - Steve Jobs... I am now accepting new clients for 2020 tax season, limited spots available. Please visit avcpa.ca to fill out the personal tax intake form. Link in bio. #internationalwomensday #womeninbusiness #canadiantax #smallbusiness #womensday2021 #femaleentrepreneur #womanforwomen #ottawavalley #renfrew #renfrewontario #accountant #cpa #charteredaccountant #ottawavalleytax

International Women’s Day hits a little different this year... it is my first as a mother of a baby girl, and my first as a business owner. I am so proud to introduce you all to my practice, Abigail Vaughan - Chartered Professional Accountant. Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do. - Steve Jobs... I am now accepting new clients for 2020 tax season, limited spots available. Please visit avcpa.ca to fill out the personal tax intake form. Link in bio. #internationalwomensday #womeninbusiness #canadiantax #smallbusiness #womensday2021 #femaleentrepreneur #womanforwomen #ottawavalley #renfrew #renfrewontario #accountant #cpa #charteredaccountant #ottawavalleytax