Evolve

Health Spending Plan Business owners should do their due diligence on setting up a health spending account in a tax advantageous way, for both themselves and their employees. Eligible medical expenses can be claimed on your personal tax return, for amounts in excess of the lower of 3% of your net income and $2,397 in 2020. Typically, the eligible medical expenses are claimed by the lower income spouse or common law partner.... If you and your spouse/common law partner income is high, or medical expenses are low relative to personal income, the medical expenses may not be eligible for a tax credit on your personal income tax return(s). It can be therefore advantageous for employers to instead implement a health spending account in their corporation. Costs for these accounts would be fully deductible to business owners. Such plans can be extended to employees (while retaining deductibility), and they would be non-taxable to the employees. Having a health care spending plan may be a chief factor in retaining or attracting key personnel, so should therefore be heavily considered, depending upon the nature of your line of work. Please reach out to the Partners at Evolve CPAs for any questions surrounding a Health Spending Accounting or other personal tax queries. Personal tax season is just around the corner. #yeg #yegaccountant #yegaccountants #edmontonaccountant #edmontonaccounting #sherwoodparkaccountant #corporatetaxes #personaltaxes #yeglocalbusiness #yegprofessionals #yegbusiness #yycbusiness #yyclocalbusiness #albertaaccounting #ruralalberta #albertaaccountant #albertabusiness #sherwoodpark #fortsaskatchewan #corporatetaxes #taxcredits #stonyplain #sprucegrove #yegsmallbusiness #supportlocalyeg #yeggers #exploreedmonton #yeglocal #healthscare #medicine

One of the most common questions accountants receive is: What’s the difference between a tax deduction and tax credit?... As personal tax season is around the corner, we’ve summarized the differences below: Tax credits directly reduce the amount of taxes you owe. For example, if you qualify for a $1,000 tax credit, your tax owing will be reduced by this amount. Typically each tax credit has a base amount, which is multiplied by the lowest tax rate in Canada (Federal - 15%) to determine the actual reduction of taxes owing. For example, the basic personal amount in Canada is $13,808, which means ($13,808 * 15%) a reduction in taxes owing of $2,071 for every taxpayer. Some tax credits are non-refundable. That means, these tax credits can only be used to reduce federal/provincial taxes to zero. Common examples of tax credits include - Basic personal amount, Spouse or Common Law Partner amount, age amount (65+), medical tax credit, tuition tax credit, donation tax credit, disability amount, and the First Time Home Buyers Credit. A tax deduction, on the other hand, reduces your taxable income for the year. This taxable income is then multiplied by your effective tax rate to determine taxes owing. Common examples of tax deductions include, but are not limited to: RRSP deduction, professional or union dues, child care expenses, moving expenses, and home office expenses. Given that many tax credits are non-refundable, it is important that you work with your CPA to strategically plan to ensure all tax credits can be utilized to the extent possible. This holds true whether you are incorporated, work as a sole proprietor, or an employee. Both a tax credit and tax deduction reduce the amount of taxes you owe; but they do so in different ways. A good tax accountant will also offer insights on potential tax deductions that are available to you. Reach out to your Partners at Evolve CPAs to optimize your after-tax cash position.

- As lockdowns across the country continue, both the Federal and Alberta Governments have offered additional financial assistance - specifically targeting businesses that had a decline in revenue. Links to apply are in our bio. () ... Must demonstrate a 50% decline in revenues for at least 3 months (not necessarily consecutive) within an 8 month period prior to the loan application. Government guaranteed, low-interest loans ranging from $25,000 to $1,000,000 Interest rate of 4%, flexible repayment terms up to 10 years. Apply directly through your financial institution. Up to 12 months postponement on the principle at the start of the loan. Available until June 30, 2021. Other conditions apply. Businesses ordered to close or curtail operations and experienced a revenue reduction of at least 30%, are now eligible a significant decrease from 50% threshold announced previously. Two phased grant - Up to $20,000 per eligible application for the first payment (pertains to initial measures in March 2020), and up to $15,000 for second payment - which relates to public health orders that were in effect from November 6, 2020 onwards. Grant expanded to include new business that commenced operations between March 1, 2020 and October 31, 2020. Grant expanded to allow unregistered sole proprietors to apply. Application will commence February 4, 2021. Reach out to the Partners at Evolve if you have any questions surrounding COVID-19 relief programs. Vaccination is just around the corner - we’re almost at the finish line. In the meantime, stay safe and practice social distancing :) #yeg #yegaccountant #yegaccountants #edmontonaccountant #edmontonaccounting #sherwoodparkaccountant #corporatetaxes #personaltaxes #yeglocalbusiness #yegprofessionals #yegbusiness #albertaaccountant #albertabusiness #sherwoodpark #financialsta

? 2020 Home Office Deduction Depending on the nature of your position, you may have found yourself working from home during the pandemic. Recently, the CRA detailed their guidance on claiming home office deductions available for individuals for the 2020 tax year.... Option 1 - Simplified method Under this method, a $2/day tax deduction is available to a maximum of $400 (200 days). The requirement is you must have worked more than 50% at home for at least 4 consecutive weeks if you select this option. This option is best served for those who only had modest expenses working from home, without the need to track expenses or provide an employer-certified T2200 Form. Option 2 - Detailed Method Under this method, the potential deduction can be higher. Prorated expenses (based on the square footage of your home office relative to total square footage of residence) of eligible expenses can be claimed. This, for salaried employees, includes electricity, heat, water, condo fees, rent, maintenance and minor repairs, as well as home internet services. This method requires an employer-certified T2200 Form. The above deductions pertain to individuals who are employees. Should you be self-employed or incorporated, home office deductions follow different criteria. Speak to the Partners at Evolve for any questions you may have on home office deductions. The Partners also have resources available for you to help simplify the calculations for deductions. #yeg #yegaccountant #yegaccountants #edmontonaccountant #edmontonaccounting #sherwoodparkaccountant #corporatetaxes #personaltaxes #yeglocalbusiness #yegprofessionals #yegbusiness #yycbusiness #yyclocalbusiness #albertaaccounting #ruralalberta #albertaaccountant #albertabusiness #sherwoodpark #fortsaskatchewan #financialstatements #corporatetaxes #personaltaxes #taxcredits #stonyplain #sprucegrove #yegsmallbusiness #supportlocalyeg #yeggers #exploreedmonton #yeglocal

? It’s important, when selecting your accountant, that you have the best information possible surrounding their credentials and experience.The Partners at Evolve encourage you to select a Chartered Professional Accountant (CPA) for your accounting needs for the following reasons: CPAs are differentiated from other accountants through rigorous licensing, education, and practical experience requirements. It takes approximately 7 y...ears of education and 2,500 hours of practical experience to become a CPA. CPAs practical experience covers a broad area of expertise including financial reporting, tax, management, and performance measurement. CPAs are governed by an Institute that monitors its members for adherence to a Code of Professional Conduct including independence, integrity, and technical proficiency. ? The Partners have over 20 years of experience (Primarily at Big 4 Firms Ernst & Young and PwC) and are highly knowledgeable about financial reporting, current tax legislation and are perpetually seeking new opportunities for your business to maximize its after-tax cash position. The Partners strategically manage their client portfolio to ensure adequate time and resources are given to your entity. We are available when you need us. The Partners are committed to fair pricing, and utilize transparent, fixed pricing options wherever possible. The Partners have invested significant technological and software resources to improve efficiencies that you can leverage for your business. This allows more time for you and us to focus on the big picture view of your entity. Remember, it’s not always about what you pay - but also what you can save. A qualified CPA will adequate long-term and short-term planning, and seek opportunities to add value beyond just preparing your financial statements and filing your corporate tax return. Consider assessing whether your current accountant is adding value to your or your organization. The Partners at Evolve CPAs are available to help. Reach out to us through the link in our bio.

As lockdowns across the country continue, business owners should consider utilizing available Federal Government support programs. These programs help businesses and their employees adapt and persevere through this difficult period. Here’s some details on programs available: Canada Emergency Wages Subsidy (CEWS) Covers part of your employee wages, retroactive to March 15, 2020. This subsidy will enable you to re-hire workers, help prevent further job losses, and ease back in...to normal operations. The deadline to apply for periods 1 to 5 is January 31, 2021. Starting with period 6, the deadline for CEWS is 180 days from the ending date of the period. Canada Emergency Rent Subsidy (CERS) Geared towards businesses, not for profits, and charities that have experienced a drop in revenue due to the COVID-19 pandemic and may be eligible for a subsidy to cover part of their commercial rent or property expenses, starting on September 27, 2020, until June 2021. Applications for each designated period are due 180 days after the period end. Criteria for the CERS are complex - but on a surface level include tests of revenues and incurring qualifying eligible expenses to non-arms length parties. Don’t hesitate to speak to our Partners at Evolve if you have any questions surrounding these programs and how they can help - including assistance with your application. Visit our website (link in bio) for information on more COVID-19 resources. . . . #yeg #evolvecpas #yegaccountant #yegaccountants #smallbusiness #edmontonaccountant #edmontonaccounting #sherwoodparkaccountant #corporatetaxes #personaltaxes #yeglocalbusiness #yeglocalbusiness #yeg #yegprofessionals #yegbusiness #yeglocals #yycbusiness #yyclocalbusiness #albertaaccounting #alberta #ruralalberta #albertaaccountant #accountantlife #accounting #accountant #financialstatements #corporatetaxes #personaltaxes #donations #taxcredits #yegsmallbusiness #CEWS #CERS

Tax Free Savings Account The best time to plant a tree was 20 years ago. The second best time is now. It’s never too early to start planning for the future. A Tax Free Savings Account is a great way to save and grow your wealth. We’d like to summarize a few key points on the Tax Free Savings Account. ... - The 2021 TFSA annual contribution limit is unchanged at $6,000 - the same amount as in 2020 and 2019. - If you don’t use your full contribution limit, it is carried forward to subsequent years. - The TFSA program is available Canadian residents 18 or older. If you were 18 or older in 2009, when the TFSA program first took effect, your total cumulative contribution room is $75,500. Check your CRA Account for your current cumulative contribution room. - Think of a TFSA as a holder for your investments. Investment income, including interest, capital gains, and dividends earned in a TFSA is sheltered from tax. - Funds can be withdrawn from your TFSA. The amounts withdrawn are added back to your contribution room in the next calendar year. - Unlike RRSPs, contributions to a TFSA are not deducted from your taxable income. In essence, TFSAs are funded by after tax money. - Although capital gains in a TFSA are tax free, capital losses also can’t be used to reduce taxable income. Consider speaking with a Financial Adviser and the Partners at Evolve about your investments, your financial goals, and tax strategies that work for you. . . . . #yeg #evolvecpas #yegaccountant #yegaccountants #smallbusiness #edmontonaccountant #edmontonaccounting #sherwoodparkaccountant #corporatetaxes #personaltaxes #yeglocalbusiness #yeg #yegprofessionals #yegbusiness #yeglocals #yycbusiness #yyclocalbusiness #alberta #albertaaccountant #accountantlife #accounting #accountant #albertabusiness #sherwoodpark #personalfinance #corporatetaxes #TFSA #taxcredits #saving #personalsavings #financetips #yegsmallbusiness