Regardless of whether you’ve been operating for a while now or are a few months into your first stint in entrepreneurship or freelancing, there’s no denying the fact that running a business in Canada is challenging. From trying to stand out in a highly-competitive atmosphere to meeting the rising standards of Canadian buyers, trying to set up shop in Canada (especially in Richmond Hill and the Greater Toronto Area) is definitely filled with obstacles. However, none can prove to be greater than dealing with the complexities of Canada’s tax system.
Although it may be clear that taxes are a fixed part of the experience of Canadian business ownership, wrangling the challenges posed by coping with your business’s dues isn’t as complex as you might expect it to be. In fact, all it takes is asking the right questions and having them answered.
If you’ve been struggling to handle your taxes or don’t know how to deal with them, chances are that your mind may be filled with many questions on the topic itself. To ensure that you have a smoother experience with your financial operations, let’s go over three questions that you might possibly have about your Canadian business’s tax-related concerns:
“Until when can I file my taxes?”
Based on the standard guidelines set by the Canadian Revenue Agency (CRA), the tax-filing deadline that individuals are obliged to follow is April 30th of every year. Canadians are also expected to pay both their due taxes and file the same returns they’re eligible for on or before the due date itself.
Aside from the standard April 30th due date, however, the tax-filing deadline can also be extended all the way to June 15th for self-employed and for Corporations it is six months after their fiscal year ends. Nevertheless, it is worth noting that the due taxes must be paid by every business—self-employed until the end of April.
Should you find yourself missing to file your business’s taxes by April 30 (or June 15, if you’re a self-employed), then you’ll end up dealing with a late-filing penalty and accompanying daily interest charge.
“When is the earliest possible date that I can start filing?”
Generally speaking, the earliest time that the CRA allows Canadians to file for their electronic returns is February 24. Aside from being able to spare yourself from the long lines over at the CRA or the nearest filing centre, filing your tax as early as possible is an optimal decision for anyone with a hefty tax bill. Filing early makes it possible to make do with even the most limited of budgets by leaving you with enough room to set up a plan that lets you pay in installments until April 30.
Although you can file as early as February 24, it is much better to wait it out a few weeks until mid-march, so you can get all your requirements (such as tax slips) for filing a return in one go, effectively making for a quicker process.
“What’s the latest date that I can contribute to my Registered Retirement Savings Plan (RRSP)?”
The last date that you can contribute to your RRSP for the previous year usually falls on the first business day of March every year. For example, since March 1 falls on a Sunday for 2020, then the cutoff or deadline for your RRSP contributions will be on March 2. It is imperative to note, however, that you can put funds into your RRSP at any time, but if you’re looking to get an apt tax refund for your RRSP contribution in the previous year, then you’ll need to reach the March deadline.
Final words
By asking the right questions and seeking the right answers to them, you’ll be able to handle your Canadian business’s tax-related concerns and challenges with greater ease. If you’re in the Richmond Hill and the surroundings and need expert assistance with your business’s tax obligations, get in touch with Iravani CPA today to see how we can help!