by Chris | Apr 24, 2016 | Taxes
*I am not a tax professional. This is meant to be an educational tool and NOT a recommendation. Each personal situation is different and there’s a lot of grey area in self-employed deductions. If you have questions (even just little ones) … talk to a tax expert.*
When you’re an opera singer at tax time two things might be true:
- You might not have made an insane amount of money
- You might have a ton of deductions
A combination of these two things means that a lot of us end up reducing the amount of tax we owe to … if not zero… then … not a ton.
It’s not cheating or tax evasion… it’s just a representation of income and the high cost of trying to find work in the opera world.
But the fun surprise at the end of your tax journey is… you still usually have to pay something.
No… it’s not tax… it’s CPP (Canada Pension Plan).
What is the CPP and why does it want all my money? (more…)
by Chris | Apr 23, 2016 | Taxes
*I am not a tax professional. This is meant to be an educational tool and NOT a recommendation. Each personal situation is different and there’s a lot of grey area in self-employed deductions. If you have questions (even just little ones) … talk to a tax expert.*
‘I need a phone for business’ he said.
‘But don’t you use it for non-business stuff?’, I wondered in his general direction.
‘ Ya. But business made me get it. So. Business.’
What could I say. The facts were ironclad.
I watched him walk away and hoped one day I would know as much as him. Argue so well. And look half as good in a sweater vest.
– excerpt from my new screenplay ‘Deduct This’ (It’s going to be kind of an Argo meets Analyse this… I have some interest from Danny DeVito’s people).
Screenplay aside… let’s talk about the rules for deducting internet and phone.
Even though the above scene is dramatized to fully take advantage of DeVito’s acting chops, I’ve heard the argument before.
And I shared that argument with an accountant friend of mine recently. His response sealed the deal.
“But would you not have a phone if you didn’t have a business?”
If the answer is yes… then maybe we have something to talk about. If not… only a percentage of that phone (and internet) is going to be allowed as a business expense. (more…)
by Chris | Apr 22, 2016 | Taxes
*I am not a tax professional. This is meant to be an educational tool and NOT a recommendation. Each personal situation is different and there’s a lot of grey area in self-employed deductions. If you have questions (even just little ones) … talk to a tax expert.*
In the opera business you need to look fancy. Sometimes really fancy. I would say… the most fancy.
And so, even though we can’t really afford rent next month, we trek out and spend hundreds of dollars on suits and gowns.
For the business, right?
Except… that when I buy a suit ‘for business’ it might also be the suit I wear to my cousin’s wedding, and for that guys’ night when we promised we’d all ‘suit up’ and take Mark out for birthday drinks.
So when it comes to tax time… how do you treat those specialty clothes of yours? (more…)
by Chris | Apr 21, 2016 | Taxes
*I am not a tax professional. This is meant to be an educational tool and NOT a recommendation. Each personal situation is different and there’s a lot of grey area in self-employed deductions. If you have questions (even just little ones) … talk to a tax expert.*
Unlike a lot of other deductions, the ‘capital cost allowance’ is one that you might not have heard of… but you’ve probably either used it already, or you really should have.
The CCA (fancy finance talk for Capital Cost Allowance) is for stuff that you buy for your business that lasts for multiple years: like a computer.
Unlike business meals or travel, a computer isn’t something that you buy every year. Its worth to your business is spread out over, hopefully, 3 – 5 years.
So the government doesn’t let you deduct the entire cost of the computer in the first year, because the worth that the computer is giving your business is spread over several years. And so the deduction that the government gives you is also spread over several years.
The specific percentage that you’re allowed to deduct every year is the capital cost allowance.
How do I know whether something is a ‘capital cost’? (more…)
by Chris | Apr 20, 2016 | Taxes
*I am not a tax professional. This is meant to be educational and NOT a recommendation. Each personal situation is different and there’s a lot of grey area in self-employed deductions. If you have questions (even just little ones) … talk to a tax expert.*
I always saw ‘bad debts’ on the list of deductions my accountant sent me and thought… well… all my debts are bad… can I just write them off?
No, silly. That’s not what bad debts are at all.
Bad debts happen when someone is supposed to pay you… but then never does.
Sounds pretty simple, but it actually brings up an important question: why would you be claiming income on your tax return that you didn’t actually receive? (more…)
