Posted by:
Zia Abbas and Amin Noorani discuss RED TAG tax filing items that may cause you to be audited by the CRA.
Featuring
Zia Abbas
Owner & President of Realty Point and Owner, President and Broke rof Record of World Class Realty Point Brokerage
Amin Noorani
CPA, ABN Professional Corp
Similar to many business owners, realtors are frequently looking to ensure that they are getting all possible tax deductions. The vast majority of realtors operate as businesses, as compared to employees, and thus share with other industries an assortment of tax deductions.
Unfortunately, many realtors begin this earnest search for tax deductions from February through April for the prior year. We want to see business owners, including realtors, plan for their deductions in advance. Ideally this planning takes place during the ...
Continue Reading →
Ontario based realtors are under a significant tax disadvantage due to some confusing combination of the rules related to their professional body (The Real Estate Council of Ontario also known as RECO) and the provincial government.
In contrast to other provinces, realtors in Ontario are effectively prevented from operating their professional activities through a corporation despite many years of discussions and lobbying. There is no reason to believe that “the powers that be” will change their views anytime soon. Perhaps insignificant ...
Continue Reading →Running a successful real estate business on your own is hard. When you have to handle every deal yourself you can end up missing out on great business opportunities just because you don’t have the time to pursue them. When the time comes to start hiring people to work with you, you take your business to the next level. You can leverage their knowledge and relationships to rapidly grow both your reputation and your profits.
But if you’re working under the ...
Continue Reading →Posted by:
As a self-employed Realtor® you pay tax based on marginal tax rates. Once you reach each threshold amount, the next dollar you earn is taxed at a higher amount. Individual tax rates in Ontario increase gradually up to a massive 49.5% – almost HALF your earnings.
Corporations pay a flat rate of 15.5% tax on net earnings up to $500k – so you can significantly cut your tax rate when you incorporate. And that’s not the only way you’ll save money. ...
Continue Reading →Posted by:
As a real estate professional you’re forced to collect income on your sales as a self-employed individual. As the market fluctuates you might earn a high income in one year and a much lower income the next. So if you earn over $136,270 in any one year you’re forced to pay over almost HALF of every extra dollar you earn in tax – whether or not you need the income at that time.
When you incorporate ...
Continue Reading →Posted by:
As a self-employed Realtor®, you pay tax at the marginal rate for individuals. As soon as your earnings hit $136,270 in any one year, you pay between 46.4% and 49.5% tax – that’s almost HALF of every additional dollar you earn going straight to the government.
That means that the harder you work and the more successful you are, the more taxes you pay.
When you incorporate your business you’ll pay a flat 15.5% tax on your ...
Continue Reading →