Disclaimer: Please note this article is not financial advice. The purpose of our blog is purely educational, so please consult a professional accountant or financial advisor before making any financial decision.
Once you begin your business, plenty of questions will occupy your mind, a typical situation for any start-up. Among all them, prioritize discovering the answers to the questions that will directly affect your business finances.
In this article, let us introduce you to the basic but essential information about the Canada Revenue Agency (CRA), taxes, and penalties when you do not pay.
The CRA is the department responsible for collecting taxes from individuals and businesses in Canada. They are the law-enforcing body ensuring that everyone religiously follows the country’s tax act so that the government will have funds for their projects. The CRA is also tasked to go after individuals and corporations not paying taxes on time or at all.
So, you must be thinking, “What happens if I don’t pay my taxes?”
Here’s a straightforward answer: if you do not pay your taxes, the CRA will come after you, and these are some of the things they can do.
Although the CRA strictly imposes these penalties, you can set up a meeting with them if the tax debt is beyond your capacity to pay at the moment. Create payment arrangements that will not hinder you from supporting your cost of living while still paying your taxes.
Some of the deals you can have with the CRA are the following:
During the meeting, ensure that you inform them of your financial situation to get an arrangement that is fair to the government and yourself.
Avoid being in this situation again or ever by following these suggestions.
Paying taxes is a bit complicated, but familiarizing yourself with the laws and working with trained professionals will make the task less of a burden.
These are the answers to some basic tax questions you may have as a business owner. As you grow your business and hire more individuals to work for you, you will also be in charge of paying for their taxes, but that will be the next step. For now, keep in mind these facts so that you can steer clear of penalties and avoid drowning in tax debt.It would also help to have a trained bookkeeper to assist you with basic income tax preparation. We at Unloop can help you with this. Give us a call so that we can discuss all our offers with you.
Unloop is the first and only accounting firm exclusively servicing ecommerce and inventory businesses in the US and Canada. With the power of people and technology, our team dives deep into COGS and inventory accounting. You are paired with a dedicated bookkeeping team that prepares accurate financial statements, financial forecasts, and can also pay bills or run payroll for you. Come tax time, everything is organized and ready to go, so you don't need to worry. Book a call with an ecommerce accountant today to learn more.