Time to budget

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So it's June.  What a spring.  Let's hope the April and May showers have passed and the summer sun is on the way. At the office, we are excited for the summer months, as I'm sure you are too.
We have been busy in May and into June.  The idea that everything slows down after April 30th is not so accurate.  It's exciting here at Henderson Campeau, we continue to grow and develop new and existing relationships.
We are trying to get some golf in as the weather improves. We are also looking forward to all the summer events and fun to be had here in Calgary


So this week the government re-introduced the 2011 budget with very little surprises.  In regards to how it may affect you click on the following link and explore the highlights.
2011 budget highlights
A few that stick out are:

• Children's arts credit.  A $500 tax credit for children enrolled in artistic activities.  Similar to the existing fitness credit but for the arts
• Family caregiver credit. An additional tax credit of $2000 for caregivers of mentally or physically infirm dependents.
• For small businesses.  A onetime $1000 EI premium credit on the company's increase in premiums if they hire new employees in the year.  (the total EI premiums for the business must be under $10,000)

Just a few highlights. Keep yourself informed and aware of how tax changes (or even current rules) affect you, your family and your business.
Have a great weekend.

Canada Day, and incorporating your business

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Beautiful Elbow Falls, I spent an afternoon out there a couple of weekends ago, some great Canadian landscape.
So it's Canada Day, very exciting.  The summer warmth is finally here. It is a great weekend to celebrate this great country of ours.
I spent a few years living in the Netherlands; their Canada Day equivalent is called Queen's Day.  They celebrate by wearing bright orange from head to toe, taking to the streets in a country wide free market, and of course cruising up and down the canals, singing laughing and celebrating everything Dutch. It is an amazing display of patriotism and joie de vivre.  My point here is that, on this holiday Friday, go out and celebrates everything Canadian; be proud about it.  Whatever it is that you love about this country go out and enjoy it; and maybe wear some bright red.  O'Canada.
Onto some accounting matters.  Since the end of the personal tax deadline we have spoke with many clients contemplating the decision to incorporate their business or not.
The decision to incorporate is a difficult one. Every business is in a different situation and has different goals.  Therefore whether to incorporate or not all depends on your situation. 
I highly recommend sitting down with your accountant before making the decision and gathering all the information you need before proceeding. 
Generally speaking, below are disadvantages and advantages of incorporating your small business. 
Disadvantages  - The costs and administrative obligations.  Once you form a corporation, you now have a separate legal entity.  This company is now completely separate from the individual. Legal and accounting fees are required to get the incorporation process completed.  (I highly recommend paying to get the company set up properly).The newly formed corporation must file corporate tax returns, produce financial statements, track balances through bookkeeping, have separate bank accounts and register each year, to mention a few requirements.
-There are many myths out there.  One such myth is that a corporation has many more tax credits and deductions available.  This is false.  A proprietorship (non incorporated business) actually has more tax credits available, as it is included on a personal tax return.  Personal tax credits can be used to reduce taxes. Business losses can be applied against other sources of income. The same business expenses/deductions against business income apply to a business, incorporated or not.
Advantages  -Limited Liability. Since a corporation is an entirely separate legal entity.  A shareholder’s personal liability is limited to what is invested in the company.
-Flexibility on timing of taxes, and distribution of income.  If a corporation does not distribute all of the profits to shareholders, there is a potential to defer personal taxes until the individual receives income from the corporation.  Deferring shareholder distributions for a subsequent year (through payroll or dividends) results in the company paying corporate taxes (at a low rate) on the profits, and the personal taxes are deferred. I’d like to emphasize that if the shareholders take all the profits from the company each year; there is no advantage to incorporating.
-Planning.  If planned appropriately the corporation can have several shareholders.  How these shareholder's are paid, when and who is paid, offers tax planning options to the corporation and shareholder.
These are just a couple of factors to consider when operating a small business.  Before making the decision, sit down with your accountant and determine what suits you the best.
Now go out and enjoy Canada.

All the leaves are brown. (Thinking of a Salary or a Dividend?)

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The leaves are brown but the sky is definitely not gray.  What a gorgeous September.  The month of July, August and September have been eventful for the firm.  Both partners enjoyed some relaxing vacation  time in Calgary and abroad. With the last three months of the year upon us the office is busy.  We have all hands on deck and look forward to tackling another busy season. Of course, we’ll also be taking some time to enjoy Calgary’s beautiful fall weather.  This week, we would like to discuss a significant accounting and tax issue we often encounter with both start up and established businesses: how to compensate the business owner. Once a business is incorporated, it is established as a legal entity know as a corporation.  The corporation is now a separate entity from the business owner.  As a result, business owners cannot simply withdraw cash from the company without tax consequences.  Corporations will need a formalized structures in place to pay the business owner. This structure is important because it will have cash management and tax implications. The two most common methods of remuneration are salary or dividend.The following considerations should be examined when putting formalized payment structures into place.  We strongly advise discussing  the following with a qualified accountant to determine what option best suits your business model. v  Salaries are considered to be active income.  Dividends are investment income.  RRSP contribution room is calculated on active income.  With active income (salary) the taxpayer’s RRSP room increases.  If your only source of income is dividends, the taxpayer cannot build RRSP room nor benefit from certain tax deductions, such as child care expenses.v  Salaries are considered operating expenses for the corporation.  They are fully deductible in the corporation.  The salaries are then taxed normally through the personal tax payer.  Dividends are not an expense for the corporation.  The dividends are taxed as investment income through the personal tax payer.   There is a tax credit available on the dividends.v   Salaries require additional administration.  Each month deductions have to be calculated and remitted to the CRA. v  With a salary, taxes are deducted from each pay cheque. As dividends are usually lump sum withdraws, the taxpayer must pay the applicable taxes when they file their personal tax return.v  CPP is not payable on dividends.v  Depending on the corporate structure, dividends can be strategically claimed to defer personal taxes and declare income to different shareholders. v  Salaries must be paid to employees of the company and dividends paid to shareholders.  If you are not an employee or not a shareholder, the choice has already been made.
As you can see, there are tax consequences and other factors to consider when determining remuneration from your company.  The decision all depends on specific circumstances for each business and owner.

Project Calgary

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The fall in Calgary has been very lovely.  Yet another great thing about living in Calgary.

The following is a link to the Calgary Herald's ongoing story about Calgary.  "Project Calgary".  We encourage you to check it out and get involved.  It is all about taking a good look at the city and discussing way to keep making the city a better place to live. 

Check it out.
http://www.calgaryherald.com/news/neighbours/index.html

Enjoy your city.

Children's art amount

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Happy spring.  At the office we are busy meeting personal clients, completing corporate year ends and excited for yet another personal tax season. It's nice to see everyone this time of year and do a little catching up.

With the 2011 personal tax season here, there are some additional credits available in 2011.  Probably the most common credit will be the children's art amount. 

All the details can be found by following this link: http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/ddctns/lns360-390/370/menu-eng.html

For clarification or just to arrange a personal tax meeting please get in touch with us.

Have a great week

Review: The Common English Bible

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"I am switching to my new favorite translation, the Common English Bible." - Doug Pagitt, pastor of Solomon's Porch and author of A Christianity Worth Believing


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Recently, I have enjoyed reading a new translation of the Holy Scriptures, the Common English Bible. I would like to recommend it to my readers. 

The Common English Bible is a new translation, which combines accessibility with scholarship. It is accurate and readable. It is a join venture in publishing by the Episcopal Church, the United Methodist Church, the Presbyterian Church USA, United Church of Christ, and the Disciples of Christ- and scholars from many other denominations worked on the project. It comes in editions both with and without the Apocrypha. The Apocrypha is used by Catholics, Orthodox, Anglicans- and traditionally by the Anabaptists. 


For mainline Christians, the CEB is a nice companion to the NRSV, the NRSV leaning more to the more literal end of the spectrum, the CEB leaning more to the dynamic end of the spectrum, but also being scholarly and accurate. I alternate between the NRSV and CEB, and have been toting around my compact CEB on a daily basis. 


Here is the web site of the Common English Bible: http://www.commonenglishbible.com/

Below are some samples the Common English Bible text: 


MY WHOLE BEING 
 Let my whole being bless the LORD! Let everything inside me bless his holy name! - Psalm 103.1 

DAY OF PENTECOST - CHANGE YOUR HEARTS AND LIVESPeter replied, "Change your hearts and lives. Each of you must be baptized in the name of Jesus Christ for the forgiveness of your sins. Then you will receive the gift of the Holy Spirit. - Acts 2.38

IT'S NOT OUR FAITH, BUT THE FAITHFULNESS OF CHRIST However, we know that a person isn’t made righteous by the works of the Law but rather through the faithfulness of Jesus Christ. We ourselves believed in Christ Jesus so that we could be made righteous by the faithfulness of Christ and not by the works of the Law—because no one will be made righteous by the works of the Law. 17 But if it is discovered that we ourselves are sinners while we are trying to be made righteous in Christ, then is Christ a servant of sin? Absolutely not! 18 If I rebuild the very things that I tore down, I show that I myself am breaking the Law. 19 I died to the Law through the Law, so that I could live for God. 20 I have been crucified with Christ and I no longer live, but Christ lives in me. And the life that I now live in my body, I live by faith, indeed, by the faithfulness of God’s Son, who loved me and gave himself for me. 21 I don’t ignore the grace of God, because if we become righteous through the Law, then Christ died for no purpose. - Galatians 2.16-21


THE HUMAN ONE No one has gone up to heaven except the one who came down from heaven, the Human One. Just as Moses lifted up the snake in the wilderness, so must the Human One be lifted up so that everyone who believes in him will have eternal life. - John 3.13-15

THE MAGNIFICAT- IN THE DEPTHS OF WHO I AM “ With all my heart I glorify the Lord!47 In the depths of who I am I rejoice in God my savior.48 He has looked with favor on the low status of his servant.Look! From now on, everyone will consider me highly favored49 because the mighty one has done great things for me.Holy is his name.50 He shows mercy to everyone,from one generation to the next,who honors him as God.51 He has shown strength with his arm.He has scattered those with arrogant thoughts and proud inclinations.52 He has pulled the powerful down from their thronesand lifted up the lowly.53 He has filled the hungry with good thingsand sent the rich away empty-handed.54 He has come to the aid of his servant Israel,remembering his mercy,55 just as he promised to our ancestors,to Abraham and to Abraham’s descendants forever. ”

Esperanza Spalding performs "Smile Like That" on KCRW

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Wow! Terrific performance by Esperanza Spalding, the First Lady of Jazz... singing and playing that groovy bass line at the same time, which always blows people away... one of the people commenting on Youtube says, "How the hell does she play bass lines like that WHILE singing?" We can say that for just about all her songs. Esperanza looks cool as she dances and bops about to the music. She feels her music intensely, which is probably why she capable of singing and playing so well at the same time. 
I also really dig the Radio Music Society Band Esperanza is touring with. The horn arrangements are very cool.
Smile Like That is probably my favorite track from the Radio Music Society CD; I also like I Can’t Help It and Black Gold.