contracts for custom software development (Canada)
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Honestly it was the best move I made. It is pretty hard to fail (ie. go completely broke) and the main reason is tax reduction. For the first few years my gross income was pretty lean but my net income was not much different than when I was working for a software company as an employee. The tax benefits are just that noticeable (especially the first two years)... Now that things are rolling along I am paying more tax (happily I might add) but it is still considerably less than when I was an employee. And my net income is significantly higher than before. The only thing i really dont like is keeping up my bookkeeping (I do my own and my accountant just checks it and gives me the final statements plus adjustments). It's not too bad unless you let it get out of control... If you dont know bookkeeping then it is another expense that you need to be able to manage. Good luck, David
The bookkeeping isn't a problem for me. I do my own bookkeeping as well and I might want to use a simply accounting, but right know it is not worth it. The job of this weekend will be looking for information on offical websites. I will also go to community futures to get some ideas. Thanks a lot for your advise! Stephan
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Hi David, wow ... thank you very much for the detailed information. I am also in British Columbia so it's the same for me. I will try to get an appointment with my accountant to discuss the incorporation. Stephan
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I incorporated in 2000 (in British Columbia) and I dont recall it being particularly expensive (few hundred dollars). Granted I just got the incorporation kit at Staples. Filled out the forms and voila. - instant incorporation -. If you hire an accountant or lawyer to setup the company the costs can add up. For a simple incorporation you really dont need it. Benefits: - Income splitting between the business and the owner (keep some money in the business and some for yourself) you save on tax. - Tax deferral. If you setup your business year end seperately from your personal year end (I use Aug 31 for the business). You can essentially defer taxes by about a year and a half. Not really a big deal but when you start this deferral can really help you get things rolling. Also having a split between year ends allows you the ability to make a paper profit or loss in the current year depending on your needs. (ie. pay yourself more after Aug 31 if you want to make more personal income in the year) - After a profitable year you can start paying out dividends that are charged tax at a lower rate - Liability protection - Initial shareholders loan. Essentially when you start the business you will be able to throw nearly all your existing computers, software, computer books, desks, supplies, etc. into the business as a Shareholder Loan. In my case this was (if I recall) about 10K. This allows you to draw up to $10K out of the business tax free (essentially you have already paid tax on the items when you bought it in the first place) That works out to about $2-3K in your pocket. - You do not need to pay any EI. You cant collect it anyway (same as sole proprietorship). - Try to setup your arrangement that your home is the head office and you work out of your clients office (pay him rent if need be..) You can write off portions of the vehicle plus also write off home heating, power, insurance, office space, telephone, etc. (keep a log of mileage, and charge only a justifiable percentage of expenses to the business. Cons: - Reporting. There are some basic Annual Reports you need to file (mostly just give them your credit card number and your done... <$100 per year). - Tax remittance. You can expect that you will have quarterly GST and Corporation Tax but monthly Current Source Deductions. - Seperate tax return for the business - Need to keep proper books - need to file T4 and other Employee statements - keeping receipts for nearly everything. - Obtaining personal loans/mortgages can become a bit more complicat
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Wierd, I'm also in B.C.
My responsibility ends where your ability to think for yourself begins.
Why? It's the nicest place on earth :) I have my business in Powell River located on the sunshine coast. Beautiful city, nice people, great nature, no real crime, ... I love it!!!
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Wierd, I'm also in B.C.
My responsibility ends where your ability to think for yourself begins.
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Why? It's the nicest place on earth :) I have my business in Powell River located on the sunshine coast. Beautiful city, nice people, great nature, no real crime, ... I love it!!!
Well not wierd so much as strange co-incidence, even stranger that you're in Powell River because I pass the turn off to the Powell river ferry every time I drive into Comox for groceries or videos. I'm in Black Creek.
My responsibility ends where your ability to think for yourself begins.
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The bookkeeping isn't a problem for me. I do my own bookkeeping as well and I might want to use a simply accounting, but right know it is not worth it. The job of this weekend will be looking for information on offical websites. I will also go to community futures to get some ideas. Thanks a lot for your advise! Stephan
Anytime. I use Quickbooks and it is pretty easy to use for the average person with at least a little knowledge of bookkeeping. btw I was flipping through your profile and noticed your Sept 24 crisis. Incorporating (ie. Employing yourself) might qualify you under a different category to receive immigration papers. You might look into it. Alternately there is a small chance (emphasize small...) that I might get a contract opportunity next week that could use an extra hand. If you are interested please send your resume to me at: drkozak@{spam.me.not}hotmail.com ("remove the curlies"). Briefly outline where you see your strengths (ie. ASP.Net, Winforms). Even if the opportunity doesnt happen I still get several opportunities a year and perhaps one might need your skill set. You dont have to pretty it up for me. We are all busy (at least I am). D.
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Cool, I'm in Black Creek just slightly north of Courtenay on Vancouver Island.
My responsibility ends where your ability to think for yourself begins.
Quite nice up there if I recall (about 15 years ago though..). I visit Nanaimo several times a year and was in Parksville just last week. Englishman River was beautiful at the falls but very cold. Are you getting any fishing in? or just soaking in the Monitor UV rays? Cheers, David
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Anytime. I use Quickbooks and it is pretty easy to use for the average person with at least a little knowledge of bookkeeping. btw I was flipping through your profile and noticed your Sept 24 crisis. Incorporating (ie. Employing yourself) might qualify you under a different category to receive immigration papers. You might look into it. Alternately there is a small chance (emphasize small...) that I might get a contract opportunity next week that could use an extra hand. If you are interested please send your resume to me at: drkozak@{spam.me.not}hotmail.com ("remove the curlies"). Briefly outline where you see your strengths (ie. ASP.Net, Winforms). Even if the opportunity doesnt happen I still get several opportunities a year and perhaps one might need your skill set. You dont have to pretty it up for me. We are all busy (at least I am). D.
Orcrist wrote:
btw I was flipping through your profile and noticed your Sept 24 crisis. Incorporating (ie. Employing yourself) might qualify you under a different category to receive immigration papers. You might look into it.
My first application for immigration failed in 2003, but I applied again right after the refusal under the Manitoba PNP. I got my visa in January 2005 and have lived in Canada since April 25, 2005. I never give up.
Orcrist wrote:
Alternately there is a small chance (emphasize small...) that I might get a contract opportunity next week that could use an extra hand. If you are interested please send your resume to me at:
I am busy right know (at least until the end of September), but I will email you my strengths. Maybe we are able to help each other from time to time. Thanks a lot! Stephan
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Well not wierd so much as strange co-incidence, even stranger that you're in Powell River because I pass the turn off to the Powell river ferry every time I drive into Comox for groceries or videos. I'm in Black Creek.
My responsibility ends where your ability to think for yourself begins.
Okay that is a strange co-incidence. Guess the next cp meeting will be in B.C. :) By the way, the ferry can be a pain in the ... when you need to catch it. If you catch it without any time pressure it is such a nice trip.
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Quite nice up there if I recall (about 15 years ago though..). I visit Nanaimo several times a year and was in Parksville just last week. Englishman River was beautiful at the falls but very cold. Are you getting any fishing in? or just soaking in the Monitor UV rays? Cheers, David
I grew up very near Englishman River Falls. For people who live in the North Island we consider anything from Parksville down to be the "crazy" area and I feel a definite sigh of relief every time I drive north past Parksville. It's so built up down there it's crazy. Up here it's still fairly peaceful and rural. No fishing unfortunately for the past couple of years, mostly work and mountain biking with some eating and sleeping in between. I haven't been out your way in years. In fact we haven't left the island since we moved back here from up north several years ago, just no reason to go anywhere else really.
My responsibility ends where your ability to think for yourself begins.
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Okay that is a strange co-incidence. Guess the next cp meeting will be in B.C. :) By the way, the ferry can be a pain in the ... when you need to catch it. If you catch it without any time pressure it is such a nice trip.
It's one of the few ferries anywhere on the west coast of Canada that I've never taken before. I love taking a ferry anywhere when I'm not in a hurry. The one between Prince Rupert and Port Hardy is really nice in particular when you're not in a hurry. Lot's of fun listening to the speculation by the tourists about what they're seeing. I thought it was unusual to see a C.P.'r from B.C. because prior to you two I've only known of one other (PJ Arends) in all the years I've been hangin' out here and I only realized he was because he had a Canucks logo in his sig for a while.
My responsibility ends where your ability to think for yourself begins.
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It's one of the few ferries anywhere on the west coast of Canada that I've never taken before. I love taking a ferry anywhere when I'm not in a hurry. The one between Prince Rupert and Port Hardy is really nice in particular when you're not in a hurry. Lot's of fun listening to the speculation by the tourists about what they're seeing. I thought it was unusual to see a C.P.'r from B.C. because prior to you two I've only known of one other (PJ Arends) in all the years I've been hangin' out here and I only realized he was because he had a Canucks logo in his sig for a while.
My responsibility ends where your ability to think for yourself begins.
John Cardinal wrote:
prior to you two I've only known of one other (PJ Arends) in all the years I've been hangin' out here and I only realized he was because he had a Canucks logo in his sig for a while.
Well, now you know yet another one. Kamloops now, formerly Port Moody. Cheers, Drew.
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It's one of the few ferries anywhere on the west coast of Canada that I've never taken before. I love taking a ferry anywhere when I'm not in a hurry. The one between Prince Rupert and Port Hardy is really nice in particular when you're not in a hurry. Lot's of fun listening to the speculation by the tourists about what they're seeing. I thought it was unusual to see a C.P.'r from B.C. because prior to you two I've only known of one other (PJ Arends) in all the years I've been hangin' out here and I only realized he was because he had a Canucks logo in his sig for a while.
My responsibility ends where your ability to think for yourself begins.
You should take this ferry one day and stop by for a coffee, lunch or BBQ (or all together). Powell River has many nice spots. I like the ferry from Powell River to Vancouver. Actually there are two ferries to take and an one hour drive betweeen. Whenever I tell my friends in Germany that we live 140 km away from Vancouver, but it takes 4 hours to get there they think I am kidding.
John Cardinal wrote:
I thought it was unusual to see a C.P.'r from B.C. because prior to you two I've only known of one other (PJ Arends) in all the years I've been hangin' out here and I only realized he was because he had a Canucks logo in his sig for a while.
Now we are the gang of four :cool: