Business Matters February 2019

Dear Client:

Attached here is the February edition of Business Matters.

Taxation

First up is an article outlining income tax changes for 2018. There are very few personal tax changes. The changes affecting companies have been discussed for some time. The takeaway from this article at this time of year should be organize your income tax information and forward it to us before April.

Management

The SCARF Model is something relatively new to us (the book, Your Brain at Work, was recommended at a seminar last fall). Be prepared to spend some time investing in the “process” of understanding how people react the way they do.

Do you or Don’t You?

Do you or don’t you have a Will?  How old is your Will? Has your family situation changed? What about your assets? A well thought out Will is one of the best gifts you can give your family.  Read on.

Privacy Compliance Strategies for Businesses

In an era of hacking and data breaches it is important for businesses to have a compliance strategy for Canada’s privacy laws. The six points listed on page 8 are an excellent starting point.

That’s it! Questions – contact us. We love interactions with clients.

Winter is over (almost). It’s time to enjoy some warmer weather and longer days.

Best regards 

JIM M. SMITH CHARTERED PROFESSIONAL ACCOUNTANTS INC.

Business Matters News

Dear Client:

Attached are the October and December issues of Business Matters – sorry for the delay!

OCTOBER 2018

Taxation

Very interesting discussion about higher CPP contributions which are being phased in over seven years starting in 2019. The impact will be significant for companies with larger payrolls.

Something to consider. Payments to employees from profit sharing plans are CPP exempt. Perhaps there is a profit-sharing plan in your company’s future especially for employee bonuses. Contact us to discuss.

Management

How do you maintain safety in the workplace? Most employers take employee safety seriously and safety awareness has increased substantially over time. This management article provides an outline concerning how to conduct a proper safety inspection – quite detailed. Don’t forget to document and follow-up.

Investing

The investing article is all about self-directed investments – advantages and disadvantages, types of accounts and the “catch-all” category other considerations.

If you do choose to go self-directed, be willing to spend some time on investment analysis, review and tracking of income and expenses.

Moneysaver

We have definitely heard a lot about the High Cost of Stress over the past number of years. For the most part, in business, we don’t deal with people suffering from extreme stress but some level of stress will be present in the work place everyday on an ebb and flow basis.

“Controlled” stress can be healthy and some people perform best under certain levels of stress – others do not. In your business do you know which staff are which in terms of stress tolerance?

DECEMBER 2018

Technical

Not every issue of Business Matters has a tech article but The Path to Automation is well worth the read. Canadian businesses need to automate (our productivity lags).

Automation is becoming more feasible for small businesses. Think about how automation could help your business – see the points on page 2.

Taxation

Does your business include “bartering” transactions? Do you sell goods or services using the internet on more than a casual basis? The taxation article discusses tax implications (GST, HST, income tax) of bartering and internet sales. It does not discuss PST but it probably should.

Moneysaver

Detailed article outlining how to “job-cost” your equipment and vehicles.

Whether it pays to job-cost your vehicles/equipment will depend, to a large extent, on how many dollars you have invested. The larger the investment the more worthwhile the exercise. Quickbooks or Sage can help you track costs.

Management

No business likes to lose clients but it happens. Check out the article Eight Reasons Clients Leave.  I don’t think there are any surprises in the list of reasons provided in the article. Complacency needs to be avoided – how do you stay “fresh” in your workplace?

Last but not least, we have attached a one-page memo discussing a Fixed vs a Growth Mindset.  Please read.

We are in the depths of what has been a fairly benign winter season so far. We hope that you enjoyed Christmas holidays. Take time to enjoy some “snow sports” before we lose the white stuff.

Best regards,

Jim M. Smith, CPA, CA

 

Dear Client:

Attached here is the August/18 edition of Business Matters. A couple of management articles, one tech and one tax. Let’s get started!

Complacency

It is a very natural tendency to become complacent at work, at home, etc. The first management article is about recognizing and combating complacency at work. As managers we have to be creative to alleviate complacency and ensure productivity. Read on for some tips you can use to combat complacency.

Electronic Signatures

We still do not see many electronic signatures in our practice. The time may be coming but it’s not here yet. All you ever wanted to know about electronic signatures in the tech article.

On a different but similar topic, make sure you have multiple signing authorities on business bank accounts.  If something happens to the owner/manager and only he/she has signing authority the business could suffer – a lot.

TFSA Taxation on Death

Good summary of what happens to TFSA’s when a person passes away. The takeaway from this article “there are potential tax complications with a TFSA when a taxpayer passes away.” Your financial institution and Chartered Professional Accountant can provide answers to any questions you may have.

Control = Responsibilities

The second management article discusses what having control of a business means. It’s not what you might think. After the article lists the dire consequences of not being in control of your business, it concludes that a culture fostering processes and procedures within a company that ensures compliance with external rules and regulations is absolutely essential to ensure proper control. Kind of wordy but makes sense.

That’s it for the August edition!

May you have “fair winds and following seas” in the months ahead.

Best regards

JIM M. SMITH CHARTERED PROFESSIONAL ACCOUNTANT INC.

Dear Client:

Attached is the June/18 edition of Business Matters. It arrived on time, but we’re slow in passing on the information. Our apologies. Let’s get started. Click here to read the articles.

Taxation

Really this is an article about potential cash flow issues that can arise if you don’t manage tax liabilities properly. Over the past 20 plus years we have seen many different nightmare scenarios in dealing with Canada Revenue Agency. As the article states “Take Charge” by completing the steps listed on page 2.

The Eyes Have It

The tech article concerns eye strain when working with screens – computers, laptop or smartphone. We’ve all experienced tired or sore eyes on more than one occasion while staring at a screen. Give those eyes a break! See the tech article for helpful hints about relieving the symptoms, eye management, etc.

Websites – Windows to the World

If your business does not have a website – get one. If it does, refresh the site often. Those are the primary take aways from this article. Also, make the website specific to your business. Good article – hey we need to update our website!

Scammers

As the article states “Scams and frauds are probably as old as humanity” but let’s face it – computerization has taken things to a whole new level. The article discusses different types of scams and how to protect yourself. Read on.

That’s it for the June edition. check out past issues on our website at jimsmithaccounting.ca.

Enjoy the rest of summer and your vacation time – hopefully you still have some left!

Best Regards,

JIM M. SMITH CPA INC.

2018 Federal Budget

  

March 1, 2018

Dear Client:

Attached here is the budget commentary from CPA Canada for the Federal budget introduced on Tuesday, Feb. 27.

There were a few relatively minor tax changes in the budget which are outlined in the commentary. One item that should come as absolutely no surprise to anyone is that the Budget introduced a new tax on cannabis products.

What about those changes proposed in July, 2017 for private corporations? In very  broad strokes there were 3 pillars that comprised the proposed changes:

1.       Income sprinkling. This issue was dealt with by the Tax On Split Income rules that were introduced on December 13, 2017 and went into effect January 1st, 2018.

2.       Reduction or elimination of tax on the disposition of shares in private corporations. The government abandoned any proposed changes in this area. 

3.       Passive/investment income earned by private corporations. As the saying goes “It’s complicated” and that is certainly the case for passive income. The government significantly backed away from its original proposals in this area. Essentially the first $50,000 of passive income will be status quo - no changes. Passive income between $50,000 and $150,000 will reduce the small business limit of $500,000 on a straight line basis. Page 3 on the commentary discusses this change. There are also changes to refundable dividend tax on hand (RDTOH) related to payment of eligible and non-eligible dividends (we said it was complicated). These changes will only affect private corporations that have taxable income in excess of $500,000 and a balance in the RDTOH account and pay eligible dividends (yes, this is a run-on sentence but a very brief one compared to many in the Income Tax Act).

The best way to sum up what has happened to the changes proposed in July, 2017 is as follows (taken from Stikeman Elliott budget commentary).

            Private corporations win 2-1 in quadruple overtime.

It feels good to win but what a struggle!

As always, any questions please contact us.

Best regards,

JIM M. SMITH CHARTERED PROFESSIONAL ACCOUNTANTS INC

Jim M. Smith, CPA, CA

Business Matters Newsletter December 2017

Business Matters December 2017

Dear Client:

Attached here is the December edition of Business Matters (conveniently late so no interference with holidays, the Super Bowl and the men’s curling championship).

Management

It’s hard to escape the term “stress” these days. Combine stress with “workplace” and you have one of the management topics for this edition. The article references changes to Ontario legislation but “most other provinces have or are in the process of initiating” similar legislation to that enacted in Ontario. Don’t become “stressed out” over the new rules- read the article.

Taxation

Yet another article that discusses the ins and outs of RRSP’s.  Very timely given the change in the calendar from January to February.  This article is well written, easy to read and contains loads of good information. Like the old saying for the Participaction program when it comes to RRSP contributions “just do it”.

Technology

I’ve often written that I’m not a techno geek but the article describing WhatsApp really was interesting.  Why wouldn’t a person use this app? Sounds like a great way to encrypt messages. Read on!

Management

The second management article discusses uses for in-house financial statements and uses for statements prepared by your external accountant (that’s us). Not covered in the article are the three different types of reports that external accountants can attach to company financial statements. These are as follows. Notice to Reader (no assurance provided on the figures, minimum input by the external accountant, lowest cost), Review Engagement (moderate assurance regarding figures contained in the statements, lots of questions asked by the accountant, some detailed analysis, moderate cost?) and Audit Opinion (assurance provided on the figures, lots of documentation on accounting systems, testing of systems and balances, many questions, verification of amounts based on professional judgement, most expensive of the three options).  If you’re not sure which option is most suitable for your company just ask

We’re on the backside of winter and any day now the first days of spring will pay us a visit. They will be most welcome.

Kind regards,

JIM M. SMITH CHARTERED PROFESSIONAL ACCOUNTANTS INC.

Jim Smith, CPA, CA

WE ARE MOVING!

Our first day back "home" at 240 Main Street, Winkler location will be July 21, 2017 -  about 11 months since the fire occurred on August 13, 2016.   We are so grateful to all of our clients for adjusting well to our temporary location and welcome you all to the new, updated office at 240 Main. We also wish to thank our general contractor, WBS Construction and numerous sub-trades for their great workmanship and patience with us during the rebuild. We will provide details later regarding our grand opening which will happen this fall.  In the meantime, we are still here to serve your needs. There will be no interruption to our office hours.

Business Matters June Edition

July 13, 2017

Dear Client:

Click here to read the June edition of Business Matters.

The first management article is titled Cannabis 101. Effective sometime in 2018, decriminalization and “controlled” distribution of marijuana will occur. Hopefully this will have very little impact on your business but if you think it will – read on.

Five finger discount is the second management article. Anyone in a retail business will be familiar with this term. Good discussion concerning ways to deter shoplifting in your business. Don’t forget that employee theft can also be a significant issue. This has been discussed in previous articles.

There are few things in life (money-wise) more enjoyable than receiving a tax refund cheque! Of course, we know that the cheque is simply a refund of our own cash but still it’s a good feeling. The taxation article is all about how to reduce or eliminate interest free loans to the government. Read on if you have been receiving refunds and want to keep more money in your bank account during the year.

Using technology tools to Connect for Profit is a definite must these days for many retailers. This article discusses using Wifi for marketing and collecting data on customers (which in turn is used for marketing). Brief but interesting.

That’s it!  Have a great summer!

We are back at 240 Main Street on July 21, 2017. Check out the “new” building under the tab Fire Update or pay us a visit in person. It’s always great to see you

Yours truly,

JIM M. SMITH CHARTERED ACCOUNTANT INC.

Jim M. Smith

Business Matters

July 13, 2017

Dear Client:

Click here to read the April edition of Business Matters (late as usual due to tax season work load).

Tax Planning

The first article discusses the importance of income tax planning for owner-managed enterprises. This is something we deal with on a daily basis. It can be very dangerous to generalize when tax planning – no two situations are identical. There are generalizations in the article. Best advice – rely on professionals who know your situation. Keep them informed and meet with them occasionally to update your tax planning strategies.

Moneysaver

Rising interest rates are a reality in the U.S. and are being talked about by the Bank of Canada. Likely, any increase will be gradual but the bottom is in as they say so an article concerning the potential effects of higher interest rates is very timely. Review all of the points listed under “Proactive Planning”, determine which apply to your situation and consider what action should be taken.

I found the Management article to be very good. All of the items listed are worth reviewing. The paragraph on page 6 that starts with the sentence “Control your business by managing rather than doing” is great. Lots to consider.

The tech article discusses passwords, specifically password management software. I think this is an area in which most businesses are a little deficient. It’s difficult to stay current with technology. It almost seems you have to pick and choose which issues to deal with at any given time. Password manager services are not expensive – that’s a good thing.

As always if you have a question don’t hesitate to contact us. We love to hear from you.

Move-Back Date

We move back to 240 Main Street in Winkler on July 21/17. It’s been great where we are but it will be even better to be back at 240 Main. It’s always good to be home!

Have a great summer!

Yours truly,

JIM M. SMITH CHARTERED ACCOUNTANT INC.

 

Jim M. Smith, C.A.