Sole Proprietor Tax Deductions
August 9th, 2010
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Question: Canadian Tax question (for operating new business)!!!?
If I were to operate my own clothing import business (as a sole proprietor), from my house of course (not anything fancy…) what kind of tax breaks could I get?
I know I can write off my car, house, electricity, etc, but what I’m worried about is that there being a loss for more than 2-3 years.
Would the Canadian govt not accept my tax calculations/deductions/or what they will pay me back as a result of loss if I’m at a loss every year?Answer: Hi Yumara
Perfect question, but my answer will only be a guide as I am not an expect in Canadian tax {not atleast as for now
}. Yes you are right, you can claim depreciation on any assets that you use for business purposes (but only to the proportion related to business, not the whole of it). As for utility bills (electricity, gas, phone etc) again you can claim a fair proportion relation to your business activities. As for tax breaks, you might get tax concessions and other breaks for small businesses (here in Australia small business is the one with turnover of less than $75,000 a year). These concessions, alongwith other things, include simplified tax rules and simplified accounting requirements.
As for losses, every business is allowed to carry forward business losses for an idefinite period and can be set off against profits of any future years, as they arise. There can, though, be certain requirements for carry forward, but those may not apply to you being a new business.
Hope it gives you some direction and I need to know your mailing address to send my consultancy invoice
Yep I noticed the changed avatar too, nice hair still
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