Being your own boss has many rewards. It also has some responsibilities. One of those responsibilities is to file taxes as a business owner if you are self-employed. Don’t worry. To help you file taxes correctly, we have mentioned everything you need to know about DIY taxes for small business owners in Canada over here.
Who is a Business Owner?
Being a business owner has nothing to do
with having a storefront or employees. You are a small business owner if you
operate a business where you are the business. Hence, small business owners are
freelancers, consultants, conteact writers, and even ride-share drivers.
Components of a Self-Employment Tax
Return
A self-employment tax return has these
three components.
1.
Identification
It includes all available details about
your business like business name and address, industry code for your business,
information on co-owners or partners, and fiscal period for your business.
2.
Business Income
In a year, the income you have earned
performing a service or selling products will be counted. Other information
like subcontractor payments can also be added here. This section is only for
gross income.
3.
Business Expenses
If you have spent money to promote yourself
or your business or invested in equipment or supplies, meals, etc., those are
your business expenses. There are countless of them. Count each of them, and
then know how much money you are actually making.
Tools to Help with DIY Taxes for Small
Business Owners in Canada
If you are looking for help to make DIY
taxes for small business owners in Canada easy, you should consider the
following tools.
1.
TurboTax
This tool is ideal for complicated tax
returns. You can file the tax for free or pay $35 for personal returns. The
costs can be anywhere from $45 to $110 for self-employed returns. It is an
ideal tool for most filers, ranging from students to freelancers and even people
with rental properties. It can also be used for family and business tax. You
can also hire professionals to file taxes on your behalf for a fee.
2.
HRBlock
Well-suited for Canadians who might need
assistance with their taxes, this tool is free to $45 for personal returns and
offers expert help starting at just $30. You can also ask a remote expert to
file tax for less than $100. It also offers two more advanced packages, The
Assistance package and the ultimate Protection plan.
This tool is good for people seeking completely
free filing. It works on a donation system. In the end, you get an option to pay what you want, and
you can choose to pay nothing.
4.
UFile
This one is best for taxpayers on a budget,
and the pricing starts at free to $19.99 for personal returns and just $29.95
for UFile Premium. Students, people with simple returns, and first-time filers
find this tool suitable.
5.
StudioTax
You can use this tool for offline filing.
The pricing ranges from free to $15. Hundreds of thousands of Canadians trust
this tool every year. It makes things simpler as you can download the program
on your computer or mobile device and work offline. Then you can print off the
return and choose not to file electronically.
If you want to know about tools approved by
the Canadian government, check this link.
Sources:
https://turbotax.intuit.ca/tips/filing-taxes-as-a-small-business-owner-6214
https://www.canada.ca/en/revenue-agency/services/e-services/e-services-individuals/netfile-overview/certified-software-netfile-program.html
https://moneywise.ca/taxes/the-best-tax-software-to-file-with-this-season?id=15922