For sellers of violins as well as related instruments and products, filing an income tax return can be a burden to a small business owner in Canada, especially if you are in the violin business. The feeling is the same for schools that offer violin courses and institutions that offer summer fiddle classes. However, you cannot deny the fact that it is one of the most important tasks you need to do to run your business.
There are things you need to bear in mind when filing income tax returns in Canada.
- Hire An Accountant To Work On Your Tax Returns.
A tax accountant is the best person to hire to help you with your tax documents for your business. Once you have hired one, your tax accountant can help you prepare your tax records. These include all recent financial statements for the business, payroll information, business expenses, motor vehicle expenses, and asset additions or disposals for the current year. Your tax accountant will also help you secure the previous year’s Notice of Assessment, payment records in instalments, and last year’s copy of your income tax return.
Getting income tax help can also be helpful when it comes to dealing with additional requirements if you are filing a T2 income tax return for corporations. Your tax accountant can help you reorganize the records in time for the filing and for your future filings.
- Apply for Voluntary Disclosure
Applying for Voluntary Disclosure can help you in certain financial situations. For one, you can use this when you want to make changes to a previously filed tax return or if you want to ask the Canada Revenue Agency, or CRA, for relief on penalties.
According to Canadian Tax Amnesty, an Income Tax Voluntary Disclosure Application must be:
- filed by you yourself in person;
- must provide all the necessary details to verify the facts, and
- must come with the payment for the total amount or payment for acceptable arrangements.
Your Voluntary Disclosure Application is dependent on the decision of the CRA. A tax accountant can approach CRA on your behalf under the no-names disclosure policy.
- Use The Income Tax Deductions To Save On Payments.
Income tax deductions can definitely help you reduce your income tax payments. However, you would need to come up with a strategic tax plan you’re your tax accountant to know which tax credits could you use to your full advantage.
For example, your small business can claim for a charitable donation tax credit and a Home Business Tax. If you have paid interns, you can avail the Apprenticeship Job Creation Tax Credit. You can also take advantage of the income tax credits available for individual taxpayers.
Running a violin business can be difficult. But there is no escaping from fulfilling your legal obligation as a taxpayer. As long as you get income tax help and coordinate things with your accountant, filing your income tax return can be a breeze year after year.